MUCH-LOVED public services will inevitably be affected by massive cuts coming next year, the leader of St Helens Borough Council has warned.
The council is projecting a £20.4 million budget gap for 2021-2022, although this could potentially widen even further due to the ongoing Covid crisis.
A council tax rise of 4.99 per cent – which includes a 3 per cent adult social care levy – is almost certain to be approved by the Labour-controlled authority later this year given the perilous position the authority finds itself in.
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But this will only go so far in addressing the council’s financial woes, and certainly won’t be enough to allow it to deliver a balanced budget in 2021-2022.
Over the past several months, senior councillors and officers have been working on identifying savings to close the £20.4 million budget black hole.
Next week, a public consultation on proposals to cut £21.9 million from the council’s budget next year is expected to begin.
A report that went before cabinet on Wednesday says a number of service reviews will be undertaken to identify non-statutory service areas that could be “reduced/ceased and to re-align service delivery models”.
Addressing his cabinet, Cllr David Baines, leader of St Helens Borough Council, said the authority finds itself in an almost “impossible” situation.
“In identifying £20 million of cuts, which is a huge number, it’s inevitable that frontline, much-loved and much-used services are going to be affected,” Cllr Baines said.
“Twice in the last year, the leaders of the local Conservatives, the Liberal Democrats, Greens and Independents, have joined me and their MPs in writing to government to set out the huge budget gap we face and to ask for urgent help.
“Twice we’ve written and twice we’ve had no reply.
“After a decade of cuts to local councils we were already in a difficult position.
“More than £90 million a year worse off than in 2010, and now because of Covid, a difficult situation has become almost impossible.”
While the situation is dire, Cllr Baines said St Helens is not in the “Doomsday” position faced by a growing number of councils that face bankruptcy.
This is backed up by comments made by Andrew Smith from Grant Thornton, the council’s external auditor, who assured councillors in December that St Helens was not in the “danger zone”.
But he warned that the authority will need to rebuild its reserves over the next five years if it it has any hope of weathering another seismic shock like Covid.
Cllr Baines said: “Because of sound, responsible financial management in recent years and because of the hard work of cabinet and officers, we’re not in the Doomsday position faced by a growing number of councils who are offering Section 114 notices and declaring bankruptcy.
“But the situation is not sustainable.
“Essential public services need to be properly funded. None of us wants to be cutting services, that goes without saying.
“While we will of course always look to cut waste and get value for money, as a Labour council we strongly and passionately believe in the value of strong, public services, and the vital role they can play if properly funded in supporting residents and communities, tackling deprivation, improving health and improving life chances.”
The provisional finance settlement from the Ministry of Housing, Communities and Local Government (MHCLG) was announced on December 18.
More details on future funding and a final settlement is expected to be published later this month or early February, after a period of consultation.
An exercise providing information in relation to the council’s budget challenge, seeking views from all residents, will run until mid-February 2021.
Cllr Seve Gomez-Aspron, deputy leader of the council and cabinet member, said: “What people struggle about with council funding is, they don’t understand that council tax doesn’t entirely fund the council budget, and that’s part of the problem in the bigger debate.
“We know that we also get money business rates, and business have been affected, we get money from government grant which has constantly been reduced.
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“And sort of pie chart that makes up the funding puts us in a position where this next year we have to make the cuts that we’re gonna make.
“We’re getting used to it aren’t we? Trite from the step of Downing Street, that doesn’t even resemble reality.
“So it’s just that point that, it’s a terrible position to be in and it’s entirely, austerity by the back door."
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