Bexley cuts: More details emerge as emergency funds sought
Further details of cuts to services in Bexley borough have been revealed as the authority seeks an emergency £15 million from central Government.
In recent weeks news of large-scale job cuts and a severe reduction in library services have been revealed. Last month a council report stated there were plans for the loss of up to 230 full time jobs at the authority.
That number is now reduced though there is no current figure for how many workers will be made redundant. Parking charges for staff will increase or be introduced. The report lays out cost pressures and states the council tax precept for social care will increase to three per cent from April 2021 from two per cent. That will result in a total council tax increase of 4.99 per cent from April 2021.
Bexley Council are in discussions with the Ministry for Housing, Communities
and Local Government for an emergency £15 million via a capitalisation order. They are one of very few UK authorities that have resorted to this.
Not all financial pressure is down to the pandemic though the majority is, with one example being an increase in mortuary costs of £1.256 million.
According to the report “The forecast overspend as at October month end is £9.225m of which £5.175m relates to COVID-19 and £4.050m to other pressures”.
“The financial challenges facing the Council cannot be under estimated. The Council has significant challenges in year but also across the medium term financial strategy period, specifically in 2021/22. There is also unprecedented uncertainty on future funding given the continued delay of the fair funding review, business rates review and the Adult Social Care Green Paper”
“Setting a balanced budget for 2021/22 is a legal requirement which the Council must achieve but, as with other years, not all information is yet available to allow final decisions to be made on balancing the budget. Further reports to Public Cabinet will be made in both January and February 2021 before setting the balanced budget in March”
Parkwood Leisure operate leisure centres. The report states “to date the monthly cost to the Council through a fall in income and direct support to the contractor is in the region of £0.445m”.
A number of measures have been taken to address financial problems. One has been cut backs to street and road maintenance.
One of the main areas of increasing spend “relate to further increases in
demand for services including care packages, placements and provider support in
both Adult and Children Social Care.” The overspend increased by £1.8 million from September to October 2020.
Tax income shortfall
Tax income is down. While council tax collection is running at 0.9 per cent below expected levels, “business rates at the end of October (Period 7) is 58.68% which is 7.27% below the target of 65.95%.”.
Any permanently lost income will not be fully reimbursed:
“The government has announced a scheme to reimburse councils for irrecoverable debts from Business Rates and Council Tax at 75p in the pound”.
Another issue is housing. Very low levels of affordable housing built in Bexley over recent years is hitting hard, with costs for emergency accommodation rising sharply alongside minimal allocations from the New Homes Bonus. NHB is an annual sum given to authorities dependent on how many new homes are built with additional amounts if affordable. Bexley will receive just £57k from affordable housing-related elements of NHB this year.
Increased fees are planned across the board next year with a full list here.