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Council tax rises and 'painful' cuts set for Royal Borough to rescue post-COVID finances

‘Painful’ service cuts could be made by the council as it looks to rescue its finances in the wake of COVID-19 and past financial mismanagement.

A medium-term financial strategy has been produced outlining how £18million needs to be saved between 2021/22 and 2025/26. Nearly £8.4million must be saved in next year’s budget, with libraries and culture in the firing line.

The plan outlines intentions to increase council tax by the maximum amount allowed each year over the next five years, and according to council leader Cllr Andrew Johnson (Con, Hurley and Walthams), he will also be lobbying the Government to enable the council to increase council tax even further.

He said: “The simple message to Government is give us the freedom to receive. Unless we can close the budget gap down without completely annihilating most council services, we would be very, very limited in what we can do.”

“The long term impacts on the borough will be massive, because it means we won’t be able to invest in providing business growth, attracting the brightest and the best, supporting people through education. We’ll be able to do none of that because we’ll have no money.”

Next year, the council will be able to increase council tax by two per cent, as well as a two per cent adult social care increase. For a greater rise, the council must hold a referendum, but Cllr Johnson is ‘optimistic’ the Government will allow the Royal Borough to do things differently.

He said: “We have a slightly unique status in that even if we put our council tax up by five per cent, six per cent, or seven per cent we will still be below the vast majority of councils in England.

“I’d be very reticent about landing big bill increases on people who are already struggling, but if we reach the point where we can’t scale the council back any further then it has to become a viable prospect otherwise we can’t deliver a balanced budget and we can’t deliver anything, that’ll be it.”

Even if the council was permitted to introduce a larger council tax increase, though, it will still need to make extensive cuts to balance the budget.

With costs for providing children’s services and adult social care rising, while income from car parks, leisure facilities and planning applications are at a standstill, cuts to services for residents are almost certain.

“Finding £8million is not going to be easy at all,” said Cllr Johnson. "It will involve very painful decisions undoubtedly, both in terms of potential tax rises but also in spending cuts as well.

“There’s scope for further efficiency, which the transformation agenda is looking to accelerate, but we’re quite limited in terms of taking cash out of the council."

Cllr Johnson said the council would have to ‘fall back’ on services like ‘libraries and culture and heritage and all the rest’ to see if further savings could be made.

“There are going to be some very difficult choices. It all comes down to what we value the most, whether its the core services that protect the vulnerable, or some of the additional, nice-to-have extras.”

He added that he did not want to cut services to the extent that it ‘hollowed out’ the borough.

Cllr Johnson has called for an extraordinary council meeting to be held on Wednesday, where councillors from all parties and groups will be able to consider the report and suggest how the council can navigate the challenging years ahead.

After that, the administration will work on creating a draft budget to present to cabinet in December, which will then be put out for public consultation to find out the public’s view.

Cllr Lynne Jones, leader of the local independents, expressed despair at the plans.

She said: “We’re going to have to see service reductions or stopping completely, I think we’re moving away from value for money.

“They want central Government to lift the cap so they can tax residents more than what they are allowed to at the moment.

“This ‘lowest council tax outside London’ has left us in a financial situation we can’t get out of.

“We have no choice.”

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