City councillors are to meet next week to consider a set of new saving and income proposals which, if accepted, would deliver £29m towards balancing Nottingham City Council’s budget for 2023/24.
The overall budget gap is £32.2m – with the current proposals leaving a further £3.2m of savings to be addressed by February 2023. The council had been on track towards setting a balanced budget next year but this was knocked off-course by the unforeseen rising inflation, fuel and energy costs that are impacting households and businesses across the country, along with other pressures including a higher-than-expected nationally-agreed pay increase for hardworking council staff which comes without any additional funding from Government.
The budget is also being set in the context of a challenging employment market, increased demand for services, some post-Covid pandemic supply chain challenges continuing to impact upon the council’s finances, the need to secure financial sustainability and resilience and continued lack of certainty over future Government funding.
Councils are required by law to set a balanced budget each year – but the Government is not due to announce until later this month how much they will provide councils towards their costs for the forthcoming financial year. The amount of Revenue Support Grant Nottingham City Council receives from Government has fallen from £126.8m a decade ago to £26.7m last year. This is the equivalent of £694 less for every household in Nottingham.
The other main source of income is Council Tax, which the Chancellor announced in his Autumn Statement can now be increased by up to 5%, including a 2% precept towards adult social care costs. The Government announcements on adult social care funding are based on councils funding most of that by increasing Council Tax through the adult social care precept. Eighty percent of Nottingham’s homes are in the two lowest Council Tax bands – almost twice the national average – reducing the council’s ability to raise funds this way. Faced with this and increasing pressures on services – particularly adult and children’s social care and homelessness support – the City Council has based its budget proposals for consultation on raising Council Tax by the full 5% permitted under Government proposals.
It has also set out a range of savings proposals, involving a workforce reduction of 110 full-time equivalent posts. These proposals will be discussed at the council’s Executive Board meeting next Tuesday (December 20). These include:
- Changes to adult social care, including more independent living support instead of residential or nursing care
- Reviewing fees and charges for parking, cremation and burials, leisure centres and cafes
- Reviewing grants to community groups, community centres and cultural organisations
- Withdrawing the Shopmobility service at the Victoria Centre
- Stopping collection of household bins put out on the wrong day
- Short-term mothballing of two floors of Loxley House pending the review of options for our offices and depots
- Increasing tariffs for EnviroEnergy customers.
Some of the proposals are part of or complement the transformation programme which is underway to radically change the way the council operates.
The City Council’s Deputy Leader and Portfolio Holder for Finance, Cllr Adele Williams, said: “Most councils up and down the country are facing significant financial difficulties, and once again we are faced with some really difficult decisions about how we balance our budget next year. We have also looked in this budget process for ways in which we can become more efficient and effective with each pound we spend for Nottingham.
“Demand continues to grow for vital services such as adult social care, which now makes up over a third of the council’s entire budget. Proposals we are considering include making efficiencies by providing these services differently, along with savings from a range of other council services.
“Since 2010 we have had to make over £300m of savings to our budgets. With vastly diminished Government grants, we have got to seriously consider the 5% Council Tax increase allowed by Government, even though this wouldn’t raise enough to properly meet local needs, and it would sadly place a further burden on local people who we know are already struggling with the cost-of-living crisis. For the vast majority of city residents, this would equate to between £1.25 and £1.46 more per week. When Nottingham households have lost out on average almost £700 of national funding since 2010, this rise is something we have been forced to consider.
“In this budget we have protected our ability to keep Nottingham communities safe with numbers of much-needed community protection officers not seen in other core cities. We have made sure that we will still be able to offer free events for families and a network of outstanding parks that will enable hard pressed Nottingham families to enjoy what they might otherwise struggle to afford to do.”
See the Executive Board report and budget proposals here (item 4): https://committee.nottinghamcity.gov.uk/ieListDocuments.aspx?CId=177&MId=9490