North Yorkshire County Council may have to find extra savings of nearly £22m – on top of cuts of around £69m already announced – as a result of increased pressure on funding by central Government.
Ministers have asked all councils to freeze council tax for a further year, in exchange for a grant equivalent to a tax rise of 1%.
Combined with additional funding cuts from central government, it means that if North Yorkshire decides to accept the grant, it will have a funding gap of £21.8m to bridge over the next two years – on top of the cutbacks already agreed as part of its original savings package.
County Councillor John Weighell, the Council’s Leader said:
Our original task of finding £69m in savings posed very considerable challenges.
If we now have to find almost a third as much again, then clearly the challenge will be even greater. This is compounded by the timing of the Government’s announcement, as we expect this will only be confirmed in January, just a few months before we need to be making the savings.
The Council has already drawn up plans for saving £8m in the year beginning next April. If it accepts the Government’s tax freeze grant, it will have to find a further £13.4m The following year, the amount to be saved will rise from £8m to £16.4m. The figures are based on preliminary assessments and announcements, which may have to be amended when the formal announcement on funding is made in January.
The County Council has done a considerable amount so far to safeguard frontline services, although some have been hit, including public transport, libraries the schools music service, and outdoor education. However, half of the original £69m savings comes from reduced “back-office” administration costs. The number of council departments has been cut, £2m has been saved from staff terms and conditions, and the number of posts has been reduced by almost 1,000, or 8% of the workforce, over the past two years. A pay freeze has been imposed for three years on all staff – and four years for most senior managers.
Councillor Weighell added:
Despite the difficulties of the past two years, North Yorkshire has continued to invest in infrastructure and services to try to ensure that the county weathers the economic recession.