Fears over funding gap at Cheltenham Borough Council
LARGER than anticipated reductions in Government funding will exacerbate Cheltenham Borough Council's budget "ordeal", it has been claimed.
When the authority started planning its budget for 2013/14, it faced an initial funding deficit of £735,000.
This funding gap grew to £955,000 over the last few months due to a number of factors including the impact of the localisation of council tax benefit payments and the changing global financial markets on the council's pension fund.
It means the council has had to scramble to find enough savings and additional income to bridge the gap for 2013/14 while maintaining a commitment to freezing parking charges at present levels – something which it has successfully achieved. However, the council's financial forecast works on the basis of an expected five per cent cut in government grant.
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But council bosses now fear the cut, due to be announced in December, could be at least 10 per cent because of the UK's economic woes.
This reduction in funding would leave the council a further hole of £235,000 which it would have to fill.
John Rawson, deputy leader of Cheltenham Borough Council and cabinet member for finance, said the authority is currently looking for ways to do this.
He said: "These are very difficult times for local authorities as the Government cuts back because of the present economic downturn.
"Cheltenham has seen a 23 per cent cut in Government grant over the last two years alone, and it will almost certainly face a further cut of at least five per cent in December. This has left us with a huge funding gap to fill.
"We have been working our socks off to find roughly a million pounds worth of efficiency savings and additional income to fill the gap. We have been able to do this without cutting back on frontline services, which is a remarkable achievement in itself.
"However, it looks as if our ordeal is not yet over. If the Government cuts the grant by more than five per cent, which looks likely, we will face a need to find more savings at very short notice. It's a mad way to run local finances, but we can only do our best with the hand the Government deals us."
Measures which have already been earmarked to help fill the original £955,000 hole include saving £43,900 by way of staff restructuring and some £93,000 from the creation of Ubico – a new company set up by the council in partnership with Cotswold District Council to deliver environmental services.
Meanwhile, a 15 per cent increase in planning fees will generate £60,000 in 2013/14.
Comments
by Dave_t10
Friday, October 12 2012, 1:43AM
“Give me 20 minutes to look at their budgets and I would cut and save millions guaranteed.
I can think of so many services that can be cut with no noticeable effect and so many efficiency savings that could be made.
Taken from their last year accounts and taken all of 2 minutes..
£38k on Twinning - scrap that, that mean jollies about for Council staff;
£49k Healthy Lifestyles - scrap that, its not the Council's job to tell people how to live;
Drastically reduce
£1,105k on Corporate Management - WHAT! you mean £1m on consultants to tell you how to do your job?;
£255k on Election Expenses - you mean on election propaganda;
£133k on Civic Expenses - which are more jollies out for Council staff;
£162k on Single Advice Contract with the Citizen's Advice Bureau - they are supposed to be a Charity, not a tax payer funded agony aunt - scrap it!
Easy to save £230,000 in there, they can't even be trying.”
by Coingrass
Thursday, October 11 2012, 10:00PM
“In May 2012, the council received an unexpected repayment of £640,000 from one of the Icelandic Banks that it had invested money in. Given that the budget for 2012-2013 had already been set when this money turned up, should it not now be available to help plug the 2013-2014 spending gap?
Also, I'm not sure the council can count on an increase in planning fees income if the government goes ahead with its stupid plan to allow people to build double-sized conservatories and extensions without planning permission.”
by capital1978
Thursday, October 11 2012, 5:30PM
“Council claiming it doesn't have enough money. Well I never. I didn't think I'd ever see that.”