Colchester city council warn it will be 'painful’ to close £5 million budget gap
The organisation says it's facing unprecedented financial pressures from inflation
An Essex council has warned closing its £5million budget gap will be “painful” as it faces unprecedented financial pressures from inflation, cuts and the pandemic.
Colchester City Council said it has an in-year budget gap of £450,000 and a further shortfall in excess of £5m.
CEO Pam Donnelly said in a statement “tough decisions” will have to be made in the wake of spiralling inflation, the recovery from the coronavirus pandemic and 12 years of national austerity.
Meanwhile, council leader David King (Lib Dem, Mile End) said local fees will rise with inflation and £1.7m will be used from the authority’s reserves. He continued to say councils across the country need help from the Government, or face bankruptcy.
He said in the statement: “Colchester will find a way, but we must close a budget gap in excess of £5m a year. It will be painful and it will require cost reduction and income raising, while we look at ways in which we can further transform our services – including our waste collection and recycling services – not just to provide financial stability, but to ensure we can continue to offer modern services for a modern city.”
This comes after the council voted to explore the possibility of scrapping its current electoral system in favour of “all up” elections every four years at a meeting on December 1, following a recommendation from the Local Government Association.
At the meeting, Conservative group leader Councillor Darius Laws (Rural North), who jointly proposed the motion with the Labour and Liberal Democrat leaders, said changing to one election every four years could save hundreds of thousands of pounds.
Cllr Laws also told the LDRS: “The Lib Dem and Labour run council have a difficult task in balancing the books against a backdrop of rising costs.
“Colchester Conservatives favour efficiency savings and exploring shared services across local authorities, as opposed to large increases in council tax.
“These inflationary pressures are unknown to this generation of local government decision-makers and we look forward to seeing what the administration at the City of Colchester Council propose.”
In the autumn statement earlier this year, Chancellor of the Exchequer Jeremy Hunt MP (Con) raised the limit local authorities could raise council tax by without holding a local referendum.
According to the statement, a management restructure has already saved the council £200,000. Further financial plans will be discussed at scrutiny and budget meetings in the new year.
Pam Donnelly said in the statement: “Balancing the budget is not the only thing we need to do. We are also comprehensively reviewing every area of the council, leaving no stone unturned, in our drive to deliver modern services for a modern city, making sure we offer the best value for money for our residents.
“This will mean that we will look to deliver some of our services in a different way, working with our communities and residents to co-design service provision, where appropriate, in a community setting – putting residents and communities in the driving seat of what services they need and how they could be delivered. There is a lot of work to do in this area, but it is well underway.
“Over the coming months, we will see more transformation that will deliver multiple benefits. It will change how we deliver services and the way in which our staff will work, but ultimately it will put us on a secure financial footing for the next few years.”