Cheshire East Council party leaders react to Govt’s Autumn Budget

Cheshire East Labour leader says the recession was made in Downing Street and now we’re all paying the price with tax hikes, increased interest charges and higher inflation, writes Belinda Ryan.

Cllr Sam Corcoran, speaking in response to Chancellor Jeremy Hunt’s autumn statement, said over the last decade the Conservatives “have hollowed out public services and the economy”.

He said in 2009/10 Cheshire East Council received government revenue support grant of £11.6m, now it receives nothing.

And he described the squeeze on council tax payers as “a tax bombshell for residents”.

“Hidden in the autumn statement documents was the confirmation that the government is lifting the limit that council tax can be raised by without a referendum – to 3% for all councils, and with an extra 2% for councils, such as Cheshire East Council, with adult social care responsibilities,” said Cllr Corcoran.

“The chancellor didn’t mention this when standing up in the Commons, as he didn’t want to draw attention to what will be an extra pressure on household budgets.”

The Labour group leader said even raising council tax by 5% won’t fix the funding gap in local government, as it had been estimated by the Local Government Association that council tax would have to rise by 20% just to meet current pressures.

Cllr Corcoran said: “Two thirds of Cheshire East Council’s expenditure is on social care costs and this is where the council is experiencing the greatest inflationary and demand-led cost pressures.”

He welcomed the fact that funding which would have been spent on proposed government reforms to adult social care – which he said would have added to costs next year – will now be allocated to dealing with increased social care costs.

But he added: “I am not sure this will be enough even to cover the extra social care costs next year.

“We now wait for the Local Government Finance Settlement 2022, due next month, when we will find out how the social care funding will be allocated and whether the government will give councils certainty by announcing a three-year settlement, or if councils will only get a one year settlement confirmed funding for 2023/24 only, which makes budget planning very difficult.”

Cllr Corcoran said for Chancellor’s review into the NHS workforce to be truly effective it would need to include the 1.6 million social care workers.

“The Conservative government still hasn’t realised the crisis in the NHS is inextricably linked to the crisis in social care,” he added.

Welcoming the National Living Wage increase, he said “this will place an extra financial burden on councils, without providing any additional funding to meet it”.

Meanwhile, Cheshire East Conservative group leader Janet Clowes has warned against high council tax increases next year after local authorities were given the option to hike charges by up to 5%.

Cllr Clowes said she was disappointed that, following the budget statement, social care charging reforms are being delayed for two years, but said councils will keep money allocated for that work to address current social care pressures – and so warned against high council tax rises.

“Potentially, an extra £2.8bn in 2023/24 and £4.7b in 2024/25 may be raised by councils responsible for social care via specific council tax rises of up to 3%,” she said.

“As councils will still receive a social care grant [amounts still to be confirmed] councils will need to consider very carefully, any council tax rise impacts on residents already experiencing cost of living pressures.”

Cllr Clowes described the Chancellor’s budget statement as “a clear statement of intent, focusing on national stability, growth and public services”.

She said the cost of living crisis was a result of the impact of Covid, Putin’s illegal war on Ukraine, rises in energy prices and inflation.

And she said while opposition parties are “predictably critical” of Jeremy Hunt’s autumn statement, they offer no coherent alternatives.

Cllr Clowes said: “Important support for the most vulnerable includes an additional £3.3b each year for the next two years for the NHS.

“The National Living Wage will rise by nine per cent to £10.42 an hour, there will be a cap on social rent rises and both pensions and benefits will be raised in line with inflation.

“The Household Support Scheme will be extended, providing a further £1b to support vulnerable households and the Energy Support Guarantee will continue to 2024, albeit at a lower rate to reflect anticipated reductions in gas prices.”

She said it is acknowledged that protecting the vulnerable and securing fiscal stability comes through tax rises and cuts in other areas.

“Nonetheless, it is right that the greatest burden falls, at this time, on those that can afford it most,” she said.

“The OBR (Office for Budget Responsibility) predicts that this budget will reduce peak inflation, reduce unemployment and increase GDP by one per cent, whilst the Bank of England expects this budget to reduce interest rates for borrowers and mortgage holders – all of which will put more of our residents’ hard-earned money back in their pockets.”