South Tyneside Council faces yet more cuts after losing £7m in funding

The pain is set to continue for South Tyneside Council and the people it serves as a near £7m cut in government funding was announced.

It means the authority will need to find yet more savings from services.

The settlement for 2015/16 – the amount the council can expect from the Government – announced by Local Government and Communities Minister Kris Hopkins yesterday, is £161,662m – compared to £168,482m – in the current financial year.

That is a reduction of four per cent and means the local authority has £6.821m less to spend on everything from waste collection to road maintenance.

That is significantly higher than the national average grant allocation cut of just 1.8 per cent.

Coun Ed Malcolm, the council’s lead member for resources and innovation, said:

“The Government has published its provisional grant figures for local authorities.

“We are currently analysing the proposed settlement for South Tyneside in detail to look at how it impacts on the local authority’s finances.

“We have already had to deal with an unprecedented series of budget cuts and have made savings of more than £100m so far. Over recent years, we have redesigned our services for maximum efficiency, improved quality through new models of service delivery and strategically planned ahead for further funding reductions.”

Borough council leaders do at least have an incentive to freeze council tax – for the fifth consecutive year.

Since 2011, the local authority has not increased the levy to its taxpayers by utilising a financial incentive from central government.

The Government has confirmed that incentive will remain in place in 2015/16 – making another freeze more likely.

Merv Butler, branch secretary of the borough’s Unison trade union, who has seen hundreds of his members lose their council jobs over the last four years, accused the Government of targeting areas in the most need.

He said: “This announcement is desperately difficult news for council staff and services.”

The local authority has already made an estimated £90m of efficiency savings since 2010, shedding 1,200 jobs in the process and the latest settlement will have an impact on every home in the borough.

There are 70,329 households in South Tyneside and average council spending on each amounts to £2,395.63p in the current financial year.

Next year that will drop to £2,298.65p – a four per cent reduction of £96,98p per household.

Mr Butler added:

“I expected a difficult settlement and that’s what we got. The fact that the council’s spending power has been reduced compared to the English average shows again that the Government is not giving sufficient grants to areas of need such as South Tyneside.”

Mr Hopkins has insisted the funding grants settlement for 2015-16 was “fair for all parts of the country”.

He said:

“Councils facing the highest demand for services continue to substantially receive more funding and we continue to ensure that no council will face a loss of more than 6.4 per cent in spending power in 2015-16, the lowest level in this Parliament.”

Source –  Shields Gazette,  19 Dec 2014

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