Sunderland council leader says Government 'giving with one hand and taking away with the other'

Sunderland City Council’s leader has slammed the Government for “giving with one hand and taking away with another”, as the city braces itself for another council tax rise and spending cuts.

Sunderland City Council’s cabinet of senior councillors, at a meeting this week, backed revenue budget proposals for the 2024/25 financial year.

To help balance the books, the council said it is ready to use £9million of reserves and to introduce nearly £7million (£6.673million) of savings and efficiencies.

Savings proposals are understood to include staffing reviews where vacant posts are not filled, plus reviews of fees and charges, and reductions in some service expenditure.

Budget plans also include proposals for a 4.99% council tax rise for council services, including a two per cent adult social care levy from the Government, which is ringfenced for these services, and a 2.99 per cent increase in core council tax.

The core council tax hike will help fund hundreds of other day-to-day services across the city, including recycling and waste collections, parks maintenance and enforcement.

Following backing from Sunderland City Council’s Labour cabinet on January 31, 2024, the revenue budget will be debated and finalised at a council meeting at the end of February, 2024.

Council leader councillor Graeme Miller, speaking at a cabinet meeting this week, slammed the Government for the “large areas of uncertainty” around the city’s final 2024/25 funding settlement.

Although it was recently announced that English councils would receive £500 million of new government funding to support social care services, councils are still awaiting information on how this will be allocated.

Cllr Miller also levelled criticism at the Government for the way councils are funded, and the expectation for councils to raise council tax to keep services moving.

Cllr Miller said: “It’s very disappointing that we’re having to put forward cabinet proposals today for our budget meeting at the end of the month when there are still large areas of uncertainty because the Government still haven’t committed to final details on what our settlement actually is in areas.

“It shows the complete lack of capability from our current government in that area.

“I believe that the black hole in local government finances after 14 years of mismanagement is now stretching to £7 billion across England and Wales and that’s far from helpful.

“So little increases in money here and there does not touch the sides.

“This government is wedded to the smoke and mirrors game of giving with one hand and taking away with another.

“They have been keen to highlight that everybody is benefiting from a 2p cut in National Insurance from this month, and I’m sure people welcome it, given that the tax burden is the highest it’s been from the 1950s.

“But at the same time, they’re taking away by forcing the tax burden through council tax, so averagely people are losing another £100 a year in Sunderland.

“So people are not better off, it’s just a con by the current Government and hopefully the death rattle of the Conservative Government as we head into the general election”.

In November, 2023, the leaders of the council’s three main political groups wrote to the Chancellor of the Exchequer outlining their concerns over budgets and spending pressures.

Concerns have previously been raised about reductions in government funding for councils since 2010, as well as inflationary and social care pressures.

Labour council bosses have said that failing to raise council tax would require the council to “cut services and reduce investment into key priority areas”.

Councillor Paul Stewart, the council’s cabinet secretary, speaking earlier this week, said “council tax only helps to finance around £16 (16 per cent) of every £100 in the council’s services budget”.

He added this was in addition to “the majority of funding coming from government grants that are not keeping up with demand and costs”.

Council leader Graeme Miller, speaking at Wednesday’s cabinet meeting at City Hall, thanked council officers for their support in the budget-setting process.

Cllr Miller said: “They have done, in my opinion, a sterling job of getting us to a balanced budget position given the uncertainties and the vagaries of a political situation of which they have no control.

“We go into another year capable of delivering services to our residents, who we all work for, but delivering more with the same, or the same with less.

“That takes real skill and is a real challenge […] and we’re thankful for that work.

“Because we would be in a very awkward place indeed if we didn’t have such a good team behind us making sure we can deliver what we can deliver”.

All councillors will be asked to vote on Sunderland City Council’s Labour Group proposals, including the proposed council tax rise, at a full council meeting this month.

The final council tax proposals will also include confirmed ‘precepts’ linked to the region’s police and crime commission and fire and rescue service.

The annual budget meeting will take place on Wednesday, February 28, at City Hall and will be open to the public.