WOKINGHAM is to receive a below-inflationary increase in its grant from the government, placing additional pressure on the council to balance the books.
It is estimated that due to increased demand on adult and children’s social care, an extra £24m is needed.
On Monday, December 18, Michael Gove announced that most councils would see an increase of 6.5% in their core spending power for the next financial year. And he called on local authorities to use their reserves to fund services.
Wokingham is to receive among the lowest amounts – a 3% increase, or £666,000.
The decision makes it likely that council tax bills will increase by the maximum permitted – 5% – to cover the rising costs due to increased demand for social care and inflationary pressures.
The government expects the council to see an increase in income from council tax and business rates.
In a written statement to parliament announcing the grants, Michael Gove said: “This settlement makes available over £64 billion for local authorities in England, an increase of almost £4 billion or 6.5% in cash terms in Core Spending Power on 2023-24.
“This is a real-terms increase which demonstrates how the Government stands behind councils up and down the country.”
“Every council sees at least a 3% increase in Core Spending Power next year before any local decisions on council tax rates and makes available an increase of almost £4 billion on 2023-24, of which £2 billion is additional Government funding – £1 billion of this is for children’s and adult social care in 2024-25.”
He continued: “The Government notes that while local authority reserves are falling, they remain significantly higher than prior to the pandemic. We continue to encourage local authorities to consider, where possible, the use of their reserves to maintain services in the face of these pressures.”
And despite the grants meaning most councils will increase council tax by 5%, Mr Gove said: “The Government’s manifesto commits to continuing to protect local taxpayers from excessive council tax increases. This is an important local democratic check and balance to avoid the repeat seen under the last Labour Government, when council tax more than doubled.”
Cllr Imogen Shepherd-DuBey, executive member for finance, said: “While a small increase in our core grant funding from Government of £666,000 is welcome, it’s disappointing that this is massively short of the borough’s needs and spending pressures we face.
“This small increase does not even come close to covering the costs of the increase in the living wage of the care staff looking after our elderly and disabled residents. It’s a drop in the ocean compared to the financial impacts we face of inflation (£11.7m) and growth (£13.1m) on the overall services we provide for our community. We are making every penny count but these increased costs are huge yet the increase in funding is minimal. The need to help the most vulnerable in our community is certainly not going away and the costs associated with this are increasing rapidly.
“The Government must look at new ways to fund councils and give this council a better deal for our residents. They have to find a way to keep in-line with overall levels of inflation, general cost increases and take full account of local needs in adult and children’s social care.
“We’ll continue to work to ensure secure sound finances and protect services for those who need us most.”
Cllr Andy Croy, leader of Wokingham Labour, was angry that the finance settlement would mean residents face higher council tax bills.
“The Conservative government has basically told local authorities to increase their Council Tax by the maximum allowable amount – this is the assumption built into their calculations. In effect, we can look forward to a local Council Tax increase of 4.99% once the Adult Social Care precept is included,” he said.
“The Conservatives propose to increase Wokingham Borough’s Settlement Funding Assessment by just over 5% – this is below the headline numbers.
“The government has increased the Revenue Support Grant it provides to Wokingham Borough by £8227.40 for the whole Borough – or less than 12p extra per household. For the Council finances this figure is so small it will not be noticed in the rounding.
“In addition, the Baseline Funding Level has gone up by just £742,000 to £15.4 million to give a total of Settlement Funding of £15.5 million.
“For comparison, the same figure in 2015/16 was £19.1 million. That is a £4 million cut in cash terms – before the effects of inflation are taken into account.
“With Council finances reeling from 13 years of underfunding, the recent surge in inflation and a growth in demand for social care provision, cuts to services and plain underdelivery of essential and non-essential services will continue to blight people’s lives.
“It is, frankly, terrible news.”
Wokingham Conservatives were invited to comment.
