Budget battle as Cambridgeshire County Council hit out at claims it is in 'financial meltdown'

PUBLISHED: 16:21 23 January 2019 | UPDATED: 11:17 24 January 2019

Council tax in Cambridgeshire up by five per cent to fill a £13 million budget hole. Picture: ARCHANT.

Council tax in Cambridgeshire up by five per cent to fill a £13 million budget hole. Picture: ARCHANT.

Archant

Cambridgeshire County Council has hit out at "irresponsible" claims it is in "financial meltdown", amid claims of poor leadership and uncertainty over the authority's upcoming budget.

The council must set a balanced budget for the financial year, for which they are projecting a remaining budget gap of £13.1million.

On top of this, it is likely there will be “substantial gaps” in the next four years after that.

This year, instead of a single budget, a range of different options, which include cutting back on services at libraries, street lighting and early years provision, will be presented to full council for them to decide.

The council will need to agree an approach that manages the budget deficit.

According to a report which went before the council’s general purposes committee today (January 22), there are many options available to the council.

The council can choose to increase the rate at which base council tax is set. According to the report, £2.728million could be raised for each one per cent tax is increased.

The council could also choose to use some of the smoothing fund agreed in last year’s budget.

According to the report: “Use of the Smoothing Fund is a sustainable option to significantly reduce the 2019-20 budget deficit, however, once applied to the gap, the funding will not be available to assist the council in meeting further funding challenges in future years.”

They could also vote to make use of the flexibility available around minimum revenue provision (MRP), or to use the transformation fund.

Finally, councillors could vote to reduce service levels. The report says services could be reduced on highway maintenance, libraries, early years provision, gritting, street lighting, and bus subsidies.

In previous years, proposals for a balanced budget have been presented to the GPC ahead of the full council meeting where the budget will be decided (February 5).

This year, however, there is concern that the Conservatives, who control the council, have not yet presented their budget amendment. This has led to suggestions that they are showing “poor leadership”.

Lib Dem leader Lucy Nethsingha said: “I do want to say how frustrating I am finding it that it is still not clear from the administration how they are planning to balance the budget.”

Cllr Nethsingha said the late presentation of the Conservatives’ budget amendment gave the impression the council “doesn’t know what it is doing.”

She said it is important for major institutions to avoid “financial surprises”, and said she did not think the Conservatives were taking that role seriously.

“It makes it very very difficult for other people to make decisions if the administration does not lay out what its plans are,” said Cllr Nethsingha. “It is poor management and poor leadership. I think it is something we should all be worried about.”

Steve Count, Conservative leader at the council, rejected Cllr Nethsingha’s claims that the Conservatives were playing political “games”, saying the Conservatives’ amendment would be published alongside opposition parties’ amendments.

He said this gave the Lib Dems a chance to put forward a budget amendment which is “proactive, not reactive” and which put forward “original ideas” rather than reactions to Conservative policies.

Cllr Count said the council has good reserves, as well as a “smoothing fund” agreed at last year’s budget, which would ensure its financial safety. He said there was “no question” of not putting forward a balanced budget, saying there would be several different options for achieving this which would be voted on at full council.

Cllr Nethsingha said the Lib Dems’ budget proposals were “relatively clear” at this point, and rejected the idea their amendment would simply react to Conservative policies.

During the discussion, there were claims that there was an “irresponsible narrative” being perpetuated by the Lib Dems around the idea the council is in “financial meltdown”.

Conservative councillor Anna Bailey said there needed to be a change in the narrative surrounding the council’s funding, and said some claims in opposition literature that the council is in trouble are “irresponsible” and “frightening”.

Cllr Bailey said spending on things like road infrastructure is increasing, and that there are a number of initiatives in place to try to improve adult social care. Cllr Count said talk of a “financial meltdown” is “hysterical” and inaccurate.

Cllr Nethsingha said it is important to tell people what their council tax is being spent on. She said the Lib Dems are not “scaremongering”, and said there needs to be a “reasonable debate” over the council’s finances.

Joan Whitehead, Labour leader on the county council, said words like “meltdown” were possibly not appropriate, but warned there are areas where public services are under “intense pressure”.

“I think we should recognise there are funding issues,” said Cllr Whitehead. “The situation is probably not going to improve.”

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