We are renewing our call on the government to give long-term fairer funding to large rural counties like North Yorkshire following this year’s financial settlement.
The settlement announced yesterday presents the county council with a very difficult choice - to take the government’s offer of increasing council tax by a further one per cent or make further cuts which will impact on frontline services.
The government has given local councils the opportunity for an additional increase of one per cent on council tax without triggering a referendum.
This would be in addition to that already proposed in North Yorkshire’s long-term financial strategy and would enable to raise council tax by 2.99 per cent, plus a further two per cent towards adult social care.
This overall increase would be equivalent to just under £5 per month for an average household.
The county council has long called on the Government to give fairer funding to large rural counties like North Yorkshire as one way of easing some of the pressures. People in North Yorkshire pay almost twice as much council tax in relative terms as those in urban and London boroughs like Westminster and Camden and receive less Government funding, yet the costs tend to be higher. Moreover, by April 2019 the council is due to receive no core government funding whereas some councils such as those in London will continue to receive significant levels of government funding.
“This settlement does nothing to fix that fundamental disparity”, said County Councillor Gareth Dadd, North Yorkshire’s Deputy Leader and Executive Member for Finance. “In fact it only serves to exacerbate the issue. North Yorkshire already pays more council tax, gets less government funding and has higher costs due to the delivery of services across England’s largest rural authority.
“In one respect the opportunity the Government has afforded us to increase council tax has to be welcomed in light of the very difficult decisions we face in continuing to meet the increasing demands on our services. However, at best it can be nothing more than a temporary fix. In itself a decision to raise council tax is also very difficult, given the impact that this will have on our residents.
“We are a high performing, low spending council praised for having a can-do culture, but we are concerned that overall the needs of rural areas are given low priority. We continue to protect the frontline and generate income, but without fairer long-term funding we face very hard choices.
“Council tax is only one part of our funding, and with the Government now announcing that it is consulting on council funding, we will continue to campaign vigorously for fairer funding for large rural councils like North Yorkshire.”
The settlement presents little change for the council’s finances so that austerity continues. Plans from last year saw the county council having to save a further £43m from its revenue budget by 2019-20. The council has plans for £33m and a savings gap of at least £10m remains. This gives a total of £169.4m saved over the decade - which represents a reduction of 34 per cent in the council’s spending power.
“It now looks like there will be significant funding shortfalls beyond 2020” said North Yorkshire’s Leader, County Councillor Carl Les. “So the Council will be considering how it deals with those pressures as part of its longer term planning.
“Of the savings already made, only 25 per cent has had an impact on frontline services to communities, with the majority coming from the back office, staff and management posts and other general efficiencies.
“The county council continues to prioritise spending in all areas that deal with vulnerable people, both young and old, but the demands on an increasingly stretched budget only continue to grow.”
Despite £5m of additional funding for adult social care raised through the two per cent social care precept in the council tax, the pressures are unrelenting and the county council is this year expecting a £3m overspend. Children’s services are seeing a similar increase in pressures. Although North Yorkshire is praised for its highly effective children’s prevention service, the number of child protection cases is starting to rise.
Councillors will meet to consider and decide upon the council’s proposed budget on 21 February 2018.
Give us your views
We are consulting on our 2018-19 budget and council tax level. We would like your views on where we should focus council spending. Take part in the consultation.