Council tax to be frozen despite £23million of government cuts this year

On 18 December the government confirmed that it was reducing the amount it allocates to the council in its Settlement Funding Assessment from £154.8million in 2014/15 to £131.6million for 2015/16. This is a 15% reduction compared to last year and is a bigger cut than the national average of 13.9%. 

Last July, the council announced that it would need to make unprecedented savings of £96million by April 2019, forcing it to change or stop some local services. This amount was set in anticipation of significant cuts to its government funding.  In addition, it reflects increasing demands on council services, in particular, adult social care, a shortage of housing with more families needing council help, along with rising costs. 

Councillors attending the meeting on Tuesday, 20 January heard that the council’s government funding for next year is line with its own pessimistic forecast.  And, there is continuing uncertainty about how much money the council will get from the government in future years.

Councillor Julian Bell, leader of the council said: “The council is facing the bleakest financial period in its history, mainly because of massive government cuts in public sector funding.  We have made good progress to identify how savings could be made so that we adapt to the dramatic change in our circumstances while living within our means.

“By freezing council tax over the past four years we estimate that we have saved local people around £26million in charges.  I know that this money will have really helped local families, especially as many will have had low or no wage rises over same period and seen other costs rise. We will continue to do everything possible to ease the financial burden on local people by keeping council tax as low as possible.”

At the meeting, councillors approved a further £12.7million of budget reductions of which £6.8million would be saved from April 2015. The council still needs to identify a further £18.8million if it is to meet its overall target.
Among the budget reductions being considered were £10.4million of savings in children’s and adults’ services.  Included in this are plans to recruit more local foster carers, who the council believes will provide better care to looked-after children and can be more efficiently managed by its in-house team. The council will also review how it spends public health funding.  As part of this approach there will be more integration between public health work and traditional council services who will work together to help people live healthier lifestyles. 

Other savings are planned to be made through changing the way some services are financed by using grants and other sources of revenue.  A full list of proposed savings considered at the meeting is available on the council’s website. 

Councillor Yvonne Johnson, cabinet member for finance, performance and welfare, said: “Confirmation that government cuts to the council were as we had predicted was very unwelcome news just days before Christmas.  As a consequence we have no choice but to make some very tough decisions and the scale of cuts that we are being forced to make is unprecedented with every service affected.  However, with the experience of handling significant government cuts previously we know that it is better to plan early and continue to be as prudent as possible, and drive down costs where we can so that we can manage this process as effectively as possible.  We will ensure that we balance the council’s budget, and run services within the money available. 

“We have ambitious plans to attract more businesses into the borough.  This will create new jobs and increase our income from business rates. We are ensuring that more affordable homes are built; as well as creating  enough school places for our children; and we will, of course, be pushing for the best healthcare services for our residents.”

The council has more information about the budget challenges it faces on its website  A video was produced at no cost to the council with help from residents, it can be viewed on YouTube.

The council will set its budget for the next financial year on 24 February.  The government will give all local authorities who freeze council tax a grant. In Ealing this is worth £1.3million. However the grant may not cover future years’ budgets and if it doesn’t the council will have to cover the funding shortfall at a later date.