Council thrown lifeline to soften blow of ‘bombshell’ budget cut

Council thrown lifeline to soften blow of ‘bombshell’ budget cut

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Lee Colyer
Finance Director Lee Colyer

The Borough Council is to receive extra funding next year after MP Greg Clark announced new transitional grants to help soften the blow of government cuts.

The £74,000 grant is likely to be supplemented by another £85,000 from the Council’s own budget, paid for from an increase in council tax.

Mr Clark, secretary of state for communities and local government, outlined new measures to help councils during a parliamentary debate last week.

He changed the rules on council tax, meaning authorities can propose an increase greater than two per cent without public consultation.

It comes after the ‘bombshell’ announcement – reported in the Times – that Tunbridge Wells is to lose half its budget next year and will be handing back money to the government to subsidise less well-off councils by 2020. Councillors feared that services such as parks, the Assembly Hall theatre and rubbish collection would be affected.

During a cabinet meeting of the borough council last Thursday, members voted unanimously in favour of raising their share of the council tax by 3.1 per cent – meaning an increase of £4.98 a year for an average Band D residence.

Lee Colyer, director of finance and corporate services said there had been a sense of “shock” at the level of revenue support grant cuts being imposed by the government.

He said: “Before we look at a budget that is dispensing cuts, we should consider the important local services that have made this a great area to live, work and visit.

“There are its parks, theatres and shopping facilities at Royal Victoria Place and also an ice-rink, which are funded by the borough.

“To hear that nearly 50 per cent of your funding is lost in a single year would decimate any authority in having to find half a million pounds in just one month. It’s not feasible or realistic to start cutting services, so fortunately we have a grant reserve in place so that we can carry on providing services. This will give us two years to formulate a plan to deal with the reduced funding.”

MP Greg Clark had been urged by borough councillors to respond to a situation which had left Tunbridge Wells as just one of 15 authorities in the country placed in a negative grant category – meaning it will pay back £610,000 to the government in 2020.

The MP confirmed in parliament that councils such as Tunbridge Wells should be permitted flexibility in setting council tax rates, rather than be penalised for being financially prudent.

Mr Clark said: “These are important times for local government. The devolution of power and resources from Whitehall is gathering momentum.

“This settlement means every council will have, for the financial year ahead, at least the resources allocated by the provisional settlement. In addition, we will provide transitional funding for the first two years of the Spending Review period for councils as they move from dependence on central government grants to greater financial autonomy.

“I have also, at the request of rural councils, helped the most economical authorities by allowing them to charge a minimum of £5 more a year in Council Tax without triggering a referendum.”

Council leader David Jukes said: “It was encouraging to see that the Secretary of State, Greg Clark, has listened to our concerns over this.”

The Council’s recommendation to raise council tax will be decided at the next meeting of full council on February 28.