Guildford residents could see their council tax rise by £100 next year
As the Borough Council faces a £2 million black hole in its budget.
Guildford council tax bills are likely to rise by nearly £100 next year as the local authority faces a £2 million black hole in its budget.
In a consultation launched today (December 1), Guildford Borough Council (GBC) is asking its residents what services they want to prioritise next year when it further tightens its purse strings.
Council leader Joss Bigmore said GBC has not received any general grant funding from the government since 2017/18 and, like many other local authorities, it has tried to bridge the gap with commercial activity like investment property.
But the pandemic has hit this hard, along with other council money-makers such as car parking and sports centre fees.
Chancellor Rishi Sunak announced in last week’s spending review that local authorities would be allowed to increase council tax by up to 5% in 2021-22, rather than the 4% limit imposed by Government this year.
It is likely all cash-strapped councils will argue they have little choice other than to raise as much money as they can.
In Guildford, full use of the limit would mean council tax for the average band D household rising £98 over the year, from £1,958.85 to £2,056.79.
However, the extra is ringfenced for Surrey County Council to pay for adult social care.
Any council that wants to hike its bills by more would need to hold a referendum of local voters, who would almost certainly vote against it.
Cllr Bigmore said: “From the average band D property council tax payment we keep just 9% of the total for our own services.
“The Police and Crime Commissioner for Surrey receives 13% and parish councils 2%, with the remaining 76% going to the county council.”
At the same time, most business rates raised are redistributed by central government to areas with a higher number of people claiming council tax benefit.
“Guildford has extremely high business rates but most of it is spent in other areas of the country. We only get to keep 5%,” said Cllr Bigmore.
“We do support the levelling up agenda, but that is quite extreme.
“We don’t necessarily see the direct benefits.”
Cllr Bigmore said £13.4 million has been spent on supporting communities through coronavirus this year, with just £4.7 million recovered from the Government.
They are expecting to receive a further £2m, leaving a £6.7 million shortfall. This will have to come out of Guildford’s reserves to enable them to maintain their community response.
Claire Morris, GBC director of financial services, said: “We will need to draw down around £7m worth of reserves at the year end in order to pay for the Covid impact during 2020/21.
“We will have to seek to replenish some, but not all of those.”
GBC is already nearing the end of a transformation agenda that sees one fifth of its workforce cut over four years.
In 2017/18 it employed 680 people and next year it is expected to have around 525 staff, a reduction of 155 roles.
Combined with IT upgrades this is said to be saving £8.5 million a year, expected to rise to £10m once complete.
“It’s quite a brutal process,” said Cllr Bigmore. “It’s got to the point where we can’t do a lot more internally.
“Difficult decisions have to be made.”
Next year’s shortfall of £2 million is 4.4% of the £45.3 million spent by GBC last year.
And the budget gap is expected to more than double to £4.4 million by 2024/25.
It is the running costs of day-to-day services that the council needs to make savings on, because local authorities are not allowed to borrow money for this purpose, whereas they can borrow to build a road or buy property for example.
GBC said it is not planning to increase fees for its services, apart from parking. Ms Morris said she thought any increases would be counterproductive, since Covid restrictions means income is already down.
So that leaves making cuts, and the council is asking the residents to have their say in a consultation that started today, December 1, and runs until January 4.
Everyone is free to comment online and additionally a £10K telephone survey will question 1,100 people, a cross-section of the borough.
Merging the delivery of some services with neighbouring councils is also an option being considered.
The 2021/22 budget will be set in February.
What are the new parking rates for Guildford Borough Council car parks?
Reduced flat-rate prices of £3 for up to three hours are being introduced at the Bedford Road, York Road and Castle multi-storey car parks as well as G-Live, Millbrook and Tunsgate car parks, from December 18.
From April 2021, the hourly rate for parking will provisionally increase by 10p to £1.60 in Mary Road, Bedford Road Surface, Commercial Road 2 and Old Police Station car parks, but this will be reviewed in January.