Calderdale Council must tighten belt to save millions of pounds over next three years
Calderdale Council will have to tighten its belt further to make millions of pounds of savings over the next three years in order to balance its budget.
Nationally, the pressures faced by top-tier local authorities have been brought into sharp focus by the financially crippled Northamptonshire County Council, which has issued two Section 114 notices – indicating the county has effectively run out of cash to meet its obligations.
That means Northamptonshire is likely to only deliver core statutory services for the “foreseeable future.”
Calderdale Council’s Cabinet will discuss its own financial strategy at its meeting at Halifax Town Hall on Monday, September 3 (6pm).
Ahead of the meeting Leader of Calderdale Council Coun Tim Swift (Lab, Town) said he was proud of the way Calderdale Council has tackled severe budget pressures in the last eight years with strategy having to be developed at a time of national uncertainty in terms of future funding and unprecedented demand for services, especially adult and children’s social care. It would continue to rise to the challenge, he said.
With savings of £105 million set to be made by 2019-20 compared to the council’s 2010 budget, these huge financial pressures were becoming unsustainable.
But plans to make the necessary savings will be put in place so the council can achieve a balanced budget in each of the next three years, although these will have a direct affect on services valued by the borough’s residents, said Coun Swift.
The council’s current financial forecast shows the authority must make savings of £1.7 million in 2019/20, £7.9 million in 2020/21 and £8.9 million from 2021/22 onwards.
Coun Swift said: “I’m proud of the way that the council has responded to the challenges of sustained austerity and we have carefully and responsibly managed to achieve a balanced budget over the last eight years.
“However, the continued reduction in funding, coupled with the uncertainty around future Government grants, and other factors such as Britain’s exit from the EU, means that realistic financial planning is becoming harder each year.
“And at the same time, we are seeing continuing growth in demand for our services from some of the most vulnerable adults and children in our communities. We have clear legal and moral responsibilities and duties to meet these needs, and this is where we have seen some councils begin to reach a breaking point.
“We will continue to put in place plans to make the savings which we have estimated are necessary to allow us to achieve a balanced budget each year, but we must clearly acknowledge that this includes a degree of risk due to the level of uncertainty on future funding.”
Every autumn the council updates its Medium Term Financial Strategy (MTFS) to inform decisions about how the local authority will manage its budget over the next three years, and this is what Cabinet will be considering.
Financial savings will not just be made by cuts alone, with the council also exploring ways in which it can increase its income through investment.
Cabinet will be asked to recommend to council that up to £15 million is included within the capital programme to allow it to proceed with its investment strategy to acquire commercial properties to generate additional income to help support its budget and services.
The MTFS report to Cabinet by officers warns that use of the council’s reserves and balances, one of the budgeting elements that is in the council’s control, should not be used further to manage any deficits – balances are near to their minimum level.
Although some other northern boroughs are more financially resilient when criteria aiming to replicate that used by a forthcoming national index is applied, Calderdale Council should have some confidence it can rise to the budget challenge as long as it continues to operate with prudece and builds on a strong relationship that exists between senior officers as well as officers and councillors, says the report.
If the MTFS report is approved by Cabinet, it will be used as a basis to create draft budget proposals which will be published for public consultation in January 2019.
The final budget proposals will then be presented to Budget Council in February 2019.