Local Government funding is under threat again
The impact of cuts to local government are starting to be clearly seen by the public. It is of no surprise really, as you cannot reduce Cornwall Council’s budget of over £320m and not have an impact on services which either results in those services being reduced, or in a few cases, stopped completely. Of course the Council gets the blame for having to deal with reduced budgets and the government gets away with it scot-free.
The Chancellors July emergency budget has clearly expressed more savings to be found from ‘non-protected areas’ in government. The Department for Communities and Local Government is one of those non-protected areas and could find itself with a further 25% – 40% cut in budget.
It is a common misunderstanding that people believe the Council’s income is solely from Council Tax. The picture below clearly (I hope) shows the amount of funding the Council receives and where it is spent.
Between 2010 and 2014, £176m was taken out of the Council’s budget. From 2014 till 2018, the Council has to save a further £154m. The cuts will be painful, but the Council’s plan has been to ‘go early’ and take £60m in the first year as this actually protects services long-term. The rest will be reduced £25.5m 2016/17, £38.2m 2017/18 and £30.2m in 2018/19. The vast majority of these savings will be from staff and other efficiencies.
The Council’s current budget has been set on a 33% reduction. If the Chancellor wants a further 25%-40% cut in local government, then sadly, we in the Council will no doubt have to look at our budget again.
If the £205m the Council receives in government funding is reduced in the Autumn Statement, my fear is there is limited option left open to the Council to make up the shortfall. As Council Tax raises are capped at 1.97% and this increase is already taken into account in the Council’s four-year budget. It could monetize certain services, but these ideas are met with very vocal objection. If the shortfall cannot be found, then services will be affected.
We in the Council are at the mercy of the Chancellor and will find out our fate on November 25th when details of the Autumn Statement is released.