Thursday, 1 March 2012

A budget leap forward

It’s a leap year; so how did Hastings councillors spend the extra day - debating the budget and plan for the next 12 months. February 29th may only come around once every four years but council budget-setting meetings come round every year and they are never easy.

There is never enough money to do all the things we want to do. Our worry currently is whether we will have enough money going forward to do all the things we have to do.

Whatever any of us think about the government’s deficit-reduction programme local councils are suffering more than other parts of the public sector, according to Price Waterhouse Cooper. And within that, according to the Joseph Rowntree Trust, poorer councils are being hit harder than the more affluent areas. Hastings is in the top 12 for the largest percentage reduction in its revenue spending power.

The budget reports placed before councillors by our finance officers showed a 50% cut in government revenue support to the council between 2010 and 2013. For councillors and council officers this is an unprecedented reduction in income.

The toughest budget is yet to come. In a year’s time the council loses its £2 million transition grant given to those 12 most badly affected councils to help cope a little more gradually with the reductions.

Much of the budget we set on 29th February was a continuation of last year’s when 40 council posts were lost and other cuts in spending brought in. So it was little easier this time around but there was not much leeway for growth

However, I was able to recommend that the council forgoes the extra income it could gain by putting up car park charges. Town centres and the retail industry are in a fragile state at the moment, so for the coming year we will not raise our car park charges as jobs and the economy are so important. But we will have to see where we are in 12 months time.

As to the council tax I recommended the council accept the government’s council tax freeze grant which covers the equivalent of a 2.5% council tax rise. With all four levying authorities accepting the freeze grant the average Hastings household will save about £40 a year.

But the grant is only for a year whereas if the council tax went up that extra income would come in every year. So in 12 months time the cliff edge we are facing will be higher.

Even in these difficult times the council was able to agree some additional spending like £10,000 to assist with the Olympic Torch celebrations and £5,000 for a guide on the disability access of shops, cafes and bars.

The council also approved capital funds to compulsorily purchase and demolish the Malvern Pub, continue the compulsory purchase of empty properties, support the project to restore Hastings Pier, refurbish council-owned factory units and to improve the appearance of the town centre.

So no increase in council tax and no increase in charges for council car parks are the key headlines from the budget-setting meeting. But there really is a dark cloud hanging over our finances. So almost immediately we have to move on to preparing for future budgets, reviewing every area of our activity – asking ourselves can we deliver each service differently and more efficiently or even can we afford to deliver it all.