Wednesday, July 6, 2022
HomeNewsBudget increase but more cuts still needed, claims Leeds City Council

Budget increase but more cuts still needed, claims Leeds City Council

Words: Richard Beecham, local democracy reporter

Leeds City Council’s budget is expected to increase next year for the first time in over a decade, but cuts to services still have to be made, according to the authority’s leadership.

The amount of money raised via council tax and business rates, along with an extra Government grant, looks set to increase council spending power in 2022/23 by £86.2m, and could result in an increase of more than 100 jobs.

But due partly to increasing costs, the authority still has to find an extra £20m worth of cuts in the coming months, with another council tax increase of just under two per cent.

The leader of Leeds City Council warned that, despite the increases in funding, money would still have to be stretched further than ever before.

The news follows the council’s medium-term financial strategy, released this year, which identified a £65.4m cut for the coming year. Since then, the council says it has already agreed £42.9m of measures to plug the gap have already been agreed.

A report, set to go before Leeds City Council’s decision-making executive board next week, shows the Government is set to increase the authority’s revenue support grant by £9m, to £37.4m.

But it was in council tax and business rates that LCC is expected to make the biggest gains.

The report stated: “There has been a partial recovery in the council tax base as levels of council tax support required have decreased and growth in the tax base has increased as the impact of Covid lessens. The total contribution of council tax to the net revenue budget is projected to increase by £23.9m in 2022/23.

“Business rates income has partially recovered in 2021/22, mainly due to the reduction in extended reliefs introduced in 2020/21 as a response to the Covid-19 crisis.”

It later added that the extra funding from business rates is expected to provide an extra £53.24m for council coffers next year.

This is expected to result in a net increase of 122 full time equivalent job posts at the authority when compared with the 2021/22 budget.

However, all of the extra funding is expected to be swallowed up by cost increases, totalling £93.1m. The biggest factors being staff pay inflation (£14.3m) and paying off debts and interest (£30.4m).

When added to other cost pressures, it leaves the council with a budget gap of £20.5m. It plans to find £17.7m of this from “directorate savings” (cuts to services) and £2.7m in “procurement savings” (cuts to money spent paying third parties to carry out work).

It also includes a proposed council tax increase of 1.99 per cent.

Leader of Leeds City Council Councillor James Lewis said:

“As the figures clearly show, we are facing another very challenging year ahead in Leeds, especially with the increasing pressure on local residents through council tax needing to be stretched to cover more services, especially those in adult social care where we have significant demand.

“As a city, Leeds and its residents continue to show remarkable resilience in adapting to the changes in all our lives caused by Covid-19, and we continue to be especially grateful for all our frontline and key workers, especially those in health roles in keeping us safe.

“I am confident we can continue to rise to the challenge through working together, continuing to be ambitious, and showing compassion especially for our most vulnerable residents in the months ahead.”

The report will be discussed by Leeds City Council’s executive board on Wednesday, December 15.

WLD cutswatch

West Leeds Dispatch‘s Cutswatch series has been following the proposed cuts over the past few months here.

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