Council bosses in Trafford are predicting a near £26million shortfall in its budget unless significant savings can be made, amid fears new Prime Minister Rishi Sunak's Government will impose more stringent austerity on local authorities.
Even with savings like a recruitment freeze, a 'review' of the authority's learning disability service, and an increase in council tax, there would be an £8.52m hole in the council's finances.
There are risks also to funding for schools. The grim picture was painted as draft budget proposals for 2023/24 and the mid-term financial strategy for 2024/26 was presented to Trafford's executive committee.
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Meanwhile, plans to increase council tax by 2.99 per cent in 2023/24 (comprising a 1pc adult social care precept on top of a 1.99pc general increase) were given the go-ahead. Executive member of finance and governance Coun Tom Ross said the budget gap for the coming financial year was £25.82m without savings currently being drawn up.
He said that part of the gap could be bridged by additional funding, dipping into the council's cash reserves and 'new savings and income generation'. Coun Ross pointed out that since the beginning of 'austerity' in 2010 until now there had been a cumulative budget gap in Trafford of £263m.
He said the purpose of the report was to 'keep members up to date following then Prime Minister Liz Truss's disastrous growth plan'. "The presumption is that there will still be a statement from the new Chancellor [Jeremy Hunt] on October 31," he continued.
"It's highly likely that, without wanting to speculate too much, local authorities across the country are being forced into more austerity measures by the national Government." Coun Ross said work on the budget would continue between now and when the final budget is set [in February 2023] as the council seeks to bridge the projected £8.52m gap.
"We don't assume that we are going to receive a generous amount from the Government," he said. "We are presenting this at a time of great uncertainty and we are certain that public services will have to take further financial strain as a result of a national failure in leadership.
"Rest assured we in Trafford continue to take our responsibilities very seriously and we will produce a balanced budget in February." His report said there would be a continuation of 'scoping' and business case development for a number of areas of potential savings 'that are already identified'.
"Most notably this includes an external review of the council's learning disability service," it said. "[There will be] a system-wide review of the provision of discharge and access to bed provision to ensure the most optimum and cost-efficient service."
It said there would also be a review of 'vacancy management protocols' which would involve temporary freezes on vacancies in all back-office service areas. In addition, there would be 'consideration [given] to other changes to staff terms and conditions.
There would also be a review of contract management and procurement arrangements to target efficiencies through 'collaborative procurement'. The report said there was a projected overspend of £724,000 for 2022/23 driven by the pressures on the 'high needs' portion of the ring-fenced dedicated schools grant.
Most of the overspend, it said, was because of additional placement costs. "There is concern nationally over the impact of special educational needs and disabilities (SEND) reform on high needs expenditure, and the financial difficulties it exposes local authorities to," it said.
"At the end of 2022/23, the accumulated high needs deficit is forecast to be at £3.1m." The council says it is currently receiving an element of low-level support from the Department of Education on helping to control the growing high-needs deficit.
But the report added: "Without new interventions, the high needs deficit is forecast to continue to increase over the next few years and is not financially sustainable. This creates a significant and unresolved financial risk to the council."
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