Millions of pounds of cuts on the way as Nottingham City Council approves budget

Nottingham’s councillors have approved a budget involving tens of millions of pounds of cuts under what some described as “duress” after a last-ditch attempt to save some services from the axe failed.

The Labour-run council issued a Section 114 notice in November, effectively declaring bankruptcy, amid a £23m shortfall in its budget in the current year.

Sweeping cuts were then proposed due to a separate budget gap of £53m in the next year beginning April 2024, and an overall anticipated shortfall of £172m up to 2027/28.

Owing to its significant financial challenges, the Department for Levelling Up, Housing and Communities announced on February 22 commissioners have been appointed to help run the council.

The three officials have taken over from the existing Improvement and Assurance Board (IAB), which was appointed three years ago upon the collapse of council-run Robin Hood Energy.

If they see fit, they can use their powers to take control of the council and force through decisions such as the firing and hiring of senior staff and service cuts.

The council officer-proposed budget was “reluctantly” approved by councillors in a seven-hour Full Council meeting on March 4, following months of intense campaigning, petitioning and calls on the Conservative Government for more funding.

In total 38 councillors voted for the proposals, Cllr Kevin Clarke (Nottm Ind), Cllr Andrew Rule (Nottm Ind) and Nadia Farhat (Ind) abstained, while one councillor, Cllr Shuguftah Quddoos (Lab), voted against them.

The remaining councillors were absent from the meeting.

Before the meeting protesters gathered outside the Council House opposing the closure of youth centres, community centres, in-house care services and care homes and the expected closure of libraries.

Keiren Thompson, who runs the Helping Kids Achieve (HKA) youth and sport group, attended a protest outside the Council House in Old Market Square before the Full Council meeting on the afternoon of Monday, March 4.

Over £1.3m will now be cut from the area-based grant funding which provides financial support to voluntary organisations and charities, and Mr Thompson says he will now lose out on an annual £15,000 contribution from the council.

Much of his work is also done from the Bulwell Riverside Play and Youth Centre and Ridge Adventure Playground, both of which will close at a loss of six jobs to save £218,000.

“We are going to see a devastating impact on our communities and our young people,” he said.

“We get area-based grant funding from the City Council which helps run our projects. For us it is around £15,000 we are going to be missing out on.

“I am feeling angry. I am feeling sad. I am feeling helpless.”

In the adult social care department, all grant funding for lunch clubs for vulnerable adults will cease, The Oaks and Cherry Trees residential care homes will close, while the Jackdawe in-house dementia care service and the Barkla Close residential respite care for adults with learning disabilities will shut.

The libraries service will now undergo a review to save £1.5m, while the council’s contribution to leisure centre operations would be cut alongside the financial contribution to the cultural sector, including the Nottingham Playhouse.

Street sweeping will be reduced to once every 12 weeks and council tax will rise by almost five per cent.

During the meeting a last-minute amendment was submitted by Cllr Adele Williams (Lab), which sought to prevent the closure of the Bulwell Riverside and Ridge youth centres, only cut half of the council’s funding to the Advice Nottingham service and prevent the axing of the Jackdawe and Barkla Close services.

It was also proposed the total savings from the libraries service be reduced to £857,000.

The amended proposals would have been funded through a reduction in the council’s planned contribution to pad-out reserves and the general fund, or by revising an “un-evidenced over-provision” of a 6.8 per cent pay rise for council staff.

However after an adjournment, councillors returned to be told the amendment could not be permitted.

Any proposed amendment had to be put forward by February 28 as to be considered by the Section 151 and chief finance officer, Ross Brown.

Accepting the amendment could have also gone against the instructions from the outgoing improvement board, which effectively tied the hands of councillors to make sure a budget was approved as required by law.

In an almost-unprecedented move, chief executive Mel Barrett later stood up to ask councillors to refrain from implying officers had acted “unethically” in rejecting the amendment during a discussion over the budget.

A total of 554 jobs will now be cut, with an expected savings total of £36.409m over the medium-term financial period of 2024/25 to 2027/28.

Even with the cuts the authority is left with a budget gap of £41m in 2024/25 and an estimated £172m shortfall over four years.

Therefore it has been granted a loan of £66m by the Department for Levelling Up, Housing and Communities.

The Exceptional Financial Support is not a Government grant and must be paid back using money raised from asset sales, with special permission given to use these capital receipts for day-to-day operational costs.

A total of 19 councils have now applied for similar emergency support, which senior councillor Steve Battlemuch (Lab) says points to a “broken” local government finance system.

Cllr Battlemuch added that while he “regrets” his involvement in Robin Hood Energy, the collapse of which cost taxpayers an estimated £38m, the losses pale in comparison to the cuts in Government funding over the last decade whichroughly equate to around £1bn.

Meanwhile councillors AJ Matsiko (Lab) and Matt Shannon (Lab) said they would be approving the budget, but under what they described as “duress”.

“This is a day that will be remembered by our city. A day remembered for all the wrong reasons,” said council leader Cllr David Mellen (Lab).

“I stand here to record the fact I do not believe in this budget. I am aware the decision we will make will have an impact that will last many years.

“That weighs heavily on me as I am sure it weighs heavily on you all, but as councillor Lux said, and councillor Wynter said just a minute ago, we have a duty to set a budget.

“I want things to keep going. I also want us to mitigate the severity of these cuts once we have made our decision today and I believe under a Labour Government things will get better.”

The approval of the budget was preceded by a motion proposed by Cllr Mellen, who called on the Government to address the funding crisis in children’s and adults’ social care amid soaring demand and private-sector costs.

The motion also called for the implementation of the Renters Reform Bill and a review of all housing legislation, and an increase in grants to councils to reflect the rate of inflation experienced over the last two years.

He added it was “immoral” for the Government to reduce funding to Nottingham by around £100m a year over the last decade while demand for statutory soared.

The motion was supported by the Labour Group as well as the Nottingham Independents and Independent Group, whose leader Cllr Kevin Clarke said the Government had “failed” to put things right.

The Government had previously repeatedly said councils should be responsible for their own finances and pointed out it has increased funding overall for local councils this year.