cost of democracy - Council Tax hike - chief executive appointed

Cheshire East Council has come under fire from residents for increasing council tax by the maximum permitted while cutting back on services at the same time.

The council is also introducing its highly unpopular green bin charge from January and consulting on hiking up parking charges.

And it’s reducing library opening hours and closing some services, such as a centre in Knutsford for adults with learning difficulties.

Understandably, residents are frustrated – they’re paying more but getting less.

And there’s more to come, as the council recently announced it is facing a potential budget deficit of £12.8m by the end of the financial year despite all the savings already made.

Cheshire East is not alone – most councils are facing a financial crisis.

But what has caused it?

At Thursday’s meeting of the council’s corporate policy committee, director of finance Alex Thompson told councillors: “The forecast is affected by a number of national issues, so we are finding inflation is continuing to remain high, interest rates are being put up… but also there is a continued increasing demand for our key services.

“That is a situation that is occurring up and down the country.”

He added a number of councils are having to take emergency measures.

Cheshire East leader Sam Corcoran (Lab) said the sheer number of councils facing financial difficulties showed there are clearly problems affecting the entire local government sector.

“We’ve known for over a decade that reform of adult social care is needed but every proposed reform has been dropped [by government],” he said.

“The result is increasing costs for councils. In Cheshire East we have a relatively elderly and ageing population, so the lack of reforms hits us harder than most.

“On children’s social care, the demand on our services is growing.

“Since the Children and Families Act 2014 came into force, the number of EHCPs (education, health and care plans) has doubled and the costs [nationally] have doubled from £4bn to £8bn.

“Government funding has not kept pace with rising costs and many councils are now running deficits on their dedicated schools grants.

“Rather than fix the problem the government have ordered councils to put these deficits into a negative reserve.”

Cheshire East’s current deficit on its special educational needs budget is £46.9m and that is forecast to rise to a whopping £306.9m by 2028.

Cllr Corcorcan said this is unsustainable and a permanent national solution is needed.

Regarding the cost of living, the council leader said: “This doesn’t only affect residents it hits council, the NHS and public bodies.

“Our council tax went up by five per cent but, last year, prices went up by 10 per cent due to inflation, so you can immediately see why councils are having to cut services. Our costs have gone up by more than our income.”

Deputy council leader Craig Browne (Ind) said residents sometimes asked him how high interest rates are relevant to councils.

“We have borrowed… to the tune of £242m with everybody’s approval, to forward-fund projects like the Poynton Relief Road, the Congleton Link Road, to invest an additional £19m in our highways capital repair programme, but of course that money has to be paid back and high interest rates mean that the repayments are higher,” said Cllr Browne.

“Then, of course, we’ve got the high level special needs deficit which, again, we’re having to borrow in order to meet that statutory service.”

He added: “The average council is facing a deficit of £33m, at least ours is only £26.6m and we’re bringing it down.”

The council is still looking to make further savings and increase its income. Measures being considered include a review of:

prices (and charges for services) to meet rising costs and inflation;
recruitment – with a focus on recruiting for statutory, or income-generating roles only;
all council contracts with suppliers and contractors;
how the council accounts for spending on projects and other day-to-day spending;
continued rationalisation of the council’s estate.

One Comment

  1. Run by idiots I am afraid, over paid CEO,who’s performance is obviously lacking, she is now moving on to a new council for more money.

    Apparently we will have to pay the new CEO around 190000 per year to attract the right person.

    Still we can still milk the public tax payers of course, utter joke,but I for one are not laughing 😂

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