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Tameside tackles funding cuts to deliver balanced budget

Press Release: 08/03/2024

TAMESIDE Council has approved a Council Tax rise to help enable the authority to meet statutory financial obligations and deliver a balanced budget.

A meeting of Full Council on Tuesday 5 March agreed an overall 4.99% increase for the Tameside element of Council Tax, which includes a 2% adult social care precept, which is ring-fenced to adult social care.

It means a typical band A property, which constitute the largest share of Tameside’s housing, will pay an extra £1.11 per week, with a typical band D property paying an extra £1.66 per week.

The latest figures show that with government support funding significantly decreased in real terms, the cost-of living crisis and increased demand for services, it has left the Council facing a £35.3 million budget pressure for the 2024/2025 financial year.    

The Council has identified and agreed new spending reductions totalling £11.83 million. These savings along with £5.7 million generated through increased council tax and £17.8 million through increases to other sources of funding and income will deliver a legal and balanced budget for the 2024/2025 financial year.  

Tameside’s total cumulative spending cuts since 2010/11 now stands at £215 million, with a further £70 million being currently forecast as necessary to deliver a balanced budget each year to 2028/29.

A decade of austerity has seen the Council’s real terms spending power reduced by 22.4%, or around £700 per household – higher than the England average of 18.9%, or £581 per household.

Tameside and similar authorities have also been disproportionately impacted by the cuts in Government grants, as they have a lower council tax base from which to raise funds.

Research shows that 95% of councils surveyed have made financial plans that assumed the full 4.99% increase of council tax and the Adult Social Care Precept, with some seeking Government permission to increase council tax even further with rates of 10% proposed.

Tameside Council is working hard to raise additional funding with its Inclusive Growth Strategy committed to unlocking and maximising all appropriate sources of revenue. This includes making the best use of Levelling Up funds for investment projects in Ashton-under-Lyne and Stalybridge, and moving forward with the creation of the Mayoral Development Zone, covering Ashton Moss, St Petersfield and other areas, in order to unlock the potential of new local rate-paying businesses.

The Greater Manchester business rates 100% retention pilot benefitted the borough by almost £3 million in the last financial year, while investment income from cash balances is expected to deliver £5.4 million in 2024-25.

Cllr Jacqueline North, executive cabinet member with responsibility for finance, said: “We did not want to pass this burden on to our residents, but there is a clear direction from government to do so. With more than a decade of funding cuts from the Government on top of a cost-of-living crisis and increasing demands for services, it has left us having no choice but to make further budget reductions and increase council tax to plug the gap to meet our statutory financial obligations and deliver a balanced budget.

“It is not a decision that we have made lightly, and in doing so we have considered evidence and feedback from a range of sources including expert opinion from our officers, discussions at Overview and Scrutiny Committees and the findings of our public Budget Conversation that ran from December to February.

“The financial outlook, not just for Tameside, but local authorities across the country, remains the most challenging in living memory. The latest additional funding by the Government doesn’t even begin to plug the gap. Research from the Local Government Association estimates that the sector as a whole requires £4 billion in new funding to cover delivery of services in the face of rising costs from inflation and demand, which would equate to more than £19 million for Tameside alone.

“The council delivers over 800 public services for Tameside and is under a legal obligation to provide the majority of these, including specialist services for vulnerable children and adults, demand for which has multiplied in recent years. The council also funds services such as waste collection, homelessness, public health, and road maintenance.

“The increase in council tax will go towards protecting and preserving vital services – especially those that support our most vulnerable residents. Our budget reductions have been built around delivering better outcomes and value for residents. We will be focused on prevention and early intervention, supporting people to live more independently and reach their full potential as well as continuing to maximise our income opportunities. I am confident that despite the challenges we face, this is a fair and sound budget that we can deliver. ”

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