DORSET Council has published its initial proposals to deliver a balanced budget for next financial year, including an increase in council tax precept and a pay freeze for staff.
These proposals will go to both the Place & Resources Scrutiny Committee and the People & Health Scrutiny Committee for consideration on December 11.
The council is required by law to set a balanced budget – in other words, expenditure must be balanced by income. However, this year’s budget-setting exercise takes place against a continuing national background of extreme financial pressure for councils resulting from the coronavirus pandemic.
The council’s COVID-19 response has resulted in additional expenditure for things like support for vulnerable residents, PPE, COVID-secure arrangements, and lost income for things like car parking, leisure services, business rates and council tax.
The government has provided some funding for these additional costs and loss of income but not enough to meet the full impact, which leaves a budget gap that has to be covered.
There is a high level of uncertainty about future cost pressures, depending on, for instance, whether there are further lockdowns and other measures needed to slow the spread of the virus.
Like most councils across the country, Dorset Council also faces budget pressures from the growing need for social care, with an ageing population.
In total, this means that Dorset Council faces a budget gap of just under £42million in 2021-22. The council proposes to cover this gap with a wide range of tactical and transformational savings which aim to improve efficiency and protect frontline services.
The council also proposes to increase council tax next year by just under 2% and to levy the adult social care precept of just under 3%, in line with the government’s Spending Review. This would equate to £1.62 extra a week for a Band D property.
The budget proposals for 2021-22 also include an assumption of a 0% pay award for council staff. The Chancellor’s recent Spending Review announced that public sector pay would be “paused”.
While central government has no formal role in deciding local government pay, which is negotiated nationally by employers with trade unions, it is likely that local government pay will follow suit.
Following discussion of the budget proposals for 2021-22 at the Scrutiny committees, the proposals will be reviewed and then submitted to the Cabinet meeting in January, and then finally to the Full Council meeting in February for final approval.
Cllr Gary Suttle, portfolio holder for Finance, Commercial and Capital Strategy, said: “It has been particularly challenging developing the budget for next financial year, 2021-22, due to the high level of uncertainty caused by the COVID pandemic.
“COVID has had a massive impact on our communities and our budget this year and this is likely to continue over the coming months.
“We believe we have developed proposals which will deliver a balanced budget. But it has not been easy and it is with a heavy heart that we have had to include proposals for a council tax increase.
“We understand that many residents and local businesses have been hit financially by the pandemic, and there will be support available for the hardest hit.
“The budget assumption of a pay freeze for staff is also made with a heavy heart when we are keenly aware how hard staff have worked for many months.
“These are tough choices, but we have to find ways to fund the support for communities through the pandemic and the ever-growing need among our residents for social care services.
“We continue to lobby the government for further funding. And we will endeavour to protect the vital council services on which so many residents rely.”