Council tax rise set to be 2.99 per cent as cash-strapped authority covers shortfall in budget by dipping into reserves, cutting jobs and 'reshaping services'

By Neil Speight 7th Jan 2022

Cllrs Shane Hebb, left, and John Kent - differing views on council's financial situation.
Cllrs Shane Hebb, left, and John Kent - differing views on council's financial situation.

CONFLICTING views over plans for Thurrock Council's finances for the next year are likely to be aired at the next meeting of the council, currently set for Wednesday, 26 January.

At that meeting opposition councillors will get the opportunity to debate the forthcoming budget proposals, which have been outlined in a report going to next week's cabinet meeting.

After weeks of juggling with the numbers, and laying out a programme of cash-saving measures which include at least 100 full time employees losing their jobs at the council in the 12 months starting in April – with more to go after that – officers have prepared a budget which they say balances.

Starting in the next financial year and up to March 2025, the council needs to reduce its annual spending by £34m.

In November the first initial draft of the council's plans, which included a significant number of proposed savings, showed it needed to find an additional £3.9 million in the financial year beginning on 1 April this year.

The report to cabinet from finance portfolio holder Cllr Shane Hebb next week shows that the saving requirement has been whittled down to £2.49 million. Cllr Hebb proposes that the shortfall be met from the council's capital receipts and general reserves.

The budget means an increase in council tax for next year of 2.99 per cent will be implemented is the budget is approved. One per cent of that increase will be ring-fenced for adult social care.

Cllr Hebb says: "It is important that extra money is provided for key services which deal with the well-being of the borough's most vulnerable children and adults.

"Thurrock - like all councils - continues to face pressures in social care services following covid.

"The Local Government Association commented in December 2021 that all councils would need to increase tax - Thurrock is no different. Where inflation is presently, this means that this is an under-inflationary increase.

"Thurrock's council tax levels are almost £500 less than some other unitary councils charge."

Cllr Hebb also compared Thurrock to fellow south Essex unitary authority Southend which, because of a different demographic mix of properties, manages to raise £16.5 million more through its council tax levy than Thurrock. While the population of the two borough's is similar – approximately 182,000 in Southend and around 178,000 in Thurrock – the number of households is different. At just over 79,000 dwellings, Southend has 11,000 more than Thurrock, with many of them in a higher council tax band classification.

Cllr Hebb goes into little detail about the proposed cuts to services and associated savings in a brief pre-meeting statement, in which he says: "By reshaping services to better target outcomes for residents, managing recruitment and looking at how we can deliver services differently while ensuring minimal impacts on residents and focusing on only the most important capital projects we have closed the budget gap we were facing next year."

He also continues to champion the council's now abandoned policy of borrowing to invest, which has seen the council's overall debt approach the £1.5 billion mark.

"The investment approach, that elected members unilaterally approved in 2017, enabled reserves increases by over 300 per cent since 2016 levels and has continued to produce income for the council, now 22 months after COVID-19 became a feature of all our lives.

"Councils across the country are in 'rainy day' scenarios, and Thurrock can use some of the reserves that were built-up for one-off pressures for such a scenario. Reserves levels will remain in excess of 2016 levels."

Labour group leader Cllr John Kent is less upbeat about the council's financial plans, saying: "This report contains little new detail as to just how the Conservatives plan to fill the £34 million black hole in the council finances.

"We already knew they planned to raid the council's reserves to the tune of £8 million, move to fortnightly bin collections, put council tax up by three per cent, increase a raft of charges and look to sell off - or close – well-loved facilities such as the Thameside and Grangewaters.

"We still don't know just how many jobs will be lost - the leader of the council has suggested over 300 - or which services will be hit by the job cuts. They need to come clean about just where these job cuts will be.

"Thurrock Conservatives have completely lost control of the council's finances. Their borrowing and investment strategy has saddled the council with a debt of one and a half billion pounds and debt interest payments of £16 million a year - we will all be paying the price of their mismanagement."

Cllr Kent also comments on the rise in council tax, which will mean the average Band D property paying around £44 a year extra. The council puts this in context by saying it is 'less than the price of a first-class stamp, or a two pint bottle of milk, each week'.

Cllr Kent says it needs to be put in the context of current inflation levels, which are hovering around the five per cent mark and is having an impact on many residents with big rises in the cost of fuel and heating.

He adds: "There is a Conservative cost of living crisis and a three per cent increase in council tax will hit many residents really hard coming the same time as a, proposed four per cent increase in council rents, an increase in National Insurance contributions, a 3.8 per cent rise in rail fares and record increases in gas and electricity bills."

     

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