The £3.2 million financial gap Nottingham City Council said it still faced next year could be plugged by extra Government funding rather than more cuts. But the authority's outgoing finance director said next year's budget would still be the most challenging one in more than 20 years.
Nottingham City Council is still looking into the impact of the Government's proposed funding settlement for councils across the country next year. The planned settlement, which was released on December 19, would see the council's spending power increasing by 9.9%.
It comes after the authority recently released proposals to fill a financial gap of £32 million next year. Despite planning savings with measures including the axing of 110 jobs and a 5% council tax increase, Nottingham City Council said it still needed to find another £3.2 million to balance its books from April.
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But Clive Heaphy, the council's outgoing Corporate Director of Finance, said the Government's recent funding offer had been positive for Nottingham. Speaking at a meeting of the overview and scrutiny committee on January 4, Mr Heaphy was asked if the extra funding could mean the need for another £3.2 million is eliminated.
He said: "It's possible. We think it could have a positive effect on us and that could remove it.
"Equally, we are aware of other pressures that we are continuing to look at as well. I suspect we will still end up with a small gap that will need some further work."
But speaking about the pressures of setting the budget more generally, Clive Heaphy said: "This budget year has been one of the most difficult we have known for a number of years. I've been in the industry for a long time and I would compare it with the budget year of 2010 and austerity in terms of the challenges we're facing with high inflation, high energy costs and supply chain problems, so it's a difficult budget to frame.
"When the provisional settlement came out in the run up to Christmas, the whole sector was running around like a certain type of fly trying to understand what that really meant. Essentially, the spending power has gone up by 9.9% for Nottingham, which is slightly below the core city average but slightly above the England average so that is a relatively good settlement."
Other Nottinghamshire councils reacted less favourably when the Government's provisional funding settlement was released. Despite being offered funding increases of 4.6% and 4.8% respectively, some on Ashfield District Council and Gedling Borough Council in particular were unhappy.
Figures from both councils say that in terms of cuts to spending since 2015, Ashfield is the country's second worst-affected council, whilst Gedling is fifth worst affected. Councillor David Martin, the Finance Spokesperson for the Ashfield Independents, which runs Ashfield District Council, said the offer "made a complete mockery of any Tory promise to level up."
A Government spokesperson said: "This settlement provides the most deprived areas of England with 17% more funding per household than the least deprived. We are also making available an additional £5 billion for councils in the next financial year, so they can continue to deliver vital frontline services."
The Government is consulting on its funding settlement until January 16. Nottingham City Council, meanwhile, is consulting on its own financial proposals until January 25 ahead of the legal deadline of March 11 to set a budget.
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