Wirral Council’s deficit has nearly quadrupled over the last year due to rising costs and inflation, according to Wirral’s council leader.
This could lead to huge cuts in services with the cost of living having a significant impact on council finances.
The council was previously praised in June for steps it took to reduce its budget gap with the previous deficit being £14m. It was criticised before that in November 2021 for a historical culture of avoiding difficult financial decisions.
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Due to rising costs for services, Council leader Janette Williamson said this budget gap has grown to around £49m.
She said unless the council receives more government funding, the council will only be able to provide statutory services, those it is legally required to provide, and make cuts elsewhere.
Cllr Janette Williamson said she plans to table a vote for all councillors to request a bailout from the UK Government over the cost of living crisis, on Friday, September 30.
Cllr Williamson was unable to provide a figure for the bailout as it will be finalised just before the motion for a vote is put in.
She said this is because of the reaction to the Government’s mini-budge t and drops in the value of the pound (£) but the figure would be in the millions.
She said: “Like most councils, if we are not given adequate funding to get us through our budget, we won’t be able to deliver anything other than statutory services.”
Asked if the council could declare bankruptcy over the deficit, Cllr Williamson said this was not going to happen: “People didn’t vote us in to abdicate responsibility.
“Look we are not going to declare bankruptcy but we have got to the point the result of that would be really tough on residents. It is not our intention though to declare bankruptcy.”
Most of the deficit comes from adult social care and bills with five areas contributing to £42m of the deficit.
Adult social care alone contributes nearly £13m to the deficit due to rising costs, demand and an ageing population in Wirral.
Bills are contributing £10.5m to the deficit with staff pay making up just under £10m too. The council has also seen a reduced income from leisure centres and other venues.
Services that could be the first to be cut to close the budget gap are early intervention and domestic abuse services, which the council is not required by law to provide.
Despite the rise in costs, Cllr Williamson said there are no plans to revisit controversial parking charges that would have seen the council generate £1m a year.
Cllr Williamson said: “It is not something I would be in favour of, putting that back on the table. I do not see how that helps anyone and would have a detrimental effect.”
Cllr Williamson previously wrote to the Treasury asking for more funds she believes is needed to support residents through the cost of living crisis. She hopes a council vote if it passes will put more political pressure on the government.
She pointed to the Local Government Association’s (LGA) call in August for a surge in funding to avoid a “disastrous impact on local services” caused by inflation.
Conservative Bedforshire Councillor and chair of the LGA said: “Inflation is not going to come down overnight. The impact on our local services could be disastrous.”
The vote on the bailout is expected to take place on October 10.
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