Cheshire East Council’s sound financial management is protecting frontline services and easing the pressure to find additional savings.
Cabinet today backed several key pre-budget reports that reveal the authority is on course to deliver a balanced budget in 2018-19, while protecting key frontline services and delivering on its core outcomes for residents.
It follows a pre-Budget Consultation 2018-21, launched in November, which set out initial proposals for how the council could target resources more effectively and save money – while achieving balanced finances.
Key proposals include earmarking £2m from the New Homes Bonus scheme, to be used in our communities via a method under consideration.
Following extensive consultation, the proposed revenue budget is balanced for 2018-19 with net revenue spending of £267.9m and total capital investment of £326.1m identified over the next three years. A total of £197m is estimated to be spent over the next three years on maintaining and improving our highways network.
Cheshire East invited feedback from residents, businesses, councillors, staff, town and parish councils and other stakeholders to inform decisions. This consultation will be an ongoing process over the next three years.
As a listening authority, the council has reflected on people’s comments and amended some of its proposed savings. These include:
● Keeping all libraries open – axing proposals to close those in Alderley Edge, Disley and Prestbury;
● A reduction in the savings to be found from highways from £500,000 to £150,000; and
● Scaling back a reduction to bus route subsidies from £1.57m to £1.1m – ensuring 97 per cent of subsidised services are retained.
The latest financial reports take place against a challenging national background of an overall public sector deficit – which is being partly met by big reductions in government grants to councils – and rising demand for both adult social care and children in care.
For Cheshire East, this means expected reductions of central government grants, inflationary costs and rising demand totalling more than £70m over the next three years.
The council proposes to meet this financial challenge via a mix of tax increases and changing our service offer. The aim is to make the council financially self-sufficient by reducing its reliance on central government revenue support grant from £40m in 2015/16 to nil in 2020.
It is now proposed to increase Council Tax by 5.99 per cent to invest in essential frontline services. This would add up to £1.28 per week to the average household Council Tax bill. A Band D property bill would rise from £1,324.92 to £1,404.28 – an increase of £1.53 per week.
Importantly, three per cent of the proposed tax rise will boost services for the vulnerable elderly. It follows a similar 4.99 per cent increase in 2017 and a 3.75 per cent increase in 2016, after five years of Council Tax freeze.
Tough choices have to be made, once again, to ensure Cheshire East can target services to people who need them most. Locally funding services puts control back with local people but also comes with the responsibility to fund them in a sustainable way.
Councillor Paul Bates, Cheshire East Council Cabinet member for finance and communications, said: “These reports, backed by cabinet, outline how the council has continued to build on the achievements of recent years and maintains strong overall financial health, performance, resilience and value for money.
“This financial year presented a number of challenges for all UK local authorities, as issues such as inflation and increasing demand in care services for children and adults were compounded by falls in government funding – a funding reduction totalling £12.4m for Cheshire East. This is set to fall by a further £12.9m in 2018/19.
“In Cheshire East, the number of residents receiving care and support from adult social care is increasing by four per cent a year and the number of children in social care placements has increased by 17 per cent in the last year, in line with other councils.
“Adult social care services across the whole country experienced rising caseloads and increasing complexity of care needs, as well as rising costs from minimum wage requirements for care providers. However, these factors were particularly significant for Cheshire East, as the number of people aged over 65 is already above the national average – and is rising faster than average.
“The council’s net expenditure on adult social care services was almost £100m in 2016/17, which is equivalent to three-times the required spending on any other service area. This council will always prioritise services for vulnerable people, despite the financial challenges. But this means other services will have to deliver savings.
“Robust action is being taken across the authority to reduce budgetary pressures and ensure balanced finances – as we have successfully done in previous years. And we will be lobbying the government again to ensure future financial settlements will continue to allow us to achieve this, while protecting essential frontline services.
“We are aware, however, that local areas have differing priorities and, to support this, the budget contains a proposal to set aside £2m of revenue from the New Homes Bonus over the next two years.
“Against a backdrop of challenging circumstances, it is pleasing to note the council is set to deliver a financial outturn within 0.05 per cent of its net budget in 2017-18, in line with our forecast, with a projected overspend of just £100,000 out of a net budget of £264.8m. It is also delivering significant achievements against the council’s corporate plan and wider business plans that will help ensure Cheshire East remains a great place to live, work, visit and do business.”
Jan Willis, Cheshire East Council’s director of finance and procurement, said: “There is a fine balance between making efficiencies in services and still enabling services to meet residents’ needs. This council will continue to look for innovative ways to make every pound deliver the best outcome for local people.”
Cheshire East Council is the third-largest unitary authority in the North West, responsible for delivering more than 500 services, supporting more than 370,000 local residents.
● The budget and Council Tax for 2018-19 will be decided by a vote of elected members at the February 22 meeting of full council.