Possible council tax rises in County Durham to help pay for covid costs

County chiefs have hinted further council tax rises could be on the cards for 2021.
There could be council tax rises in 2021 to help make ends meet after the pandemicThere could be council tax rises in 2021 to help make ends meet after the pandemic
There could be council tax rises in 2021 to help make ends meet after the pandemic

The impact of the coronavirus outbreak has left local authorities struggling to raise funds at the same time costs and demands for services have surged.

And the pressure on balance sheets has left finance bosses at Durham County Council (DCC) to raise the prospect of higher household bills, as well as dipping into council savings and cuts.

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“We’re projecting savings of £42.7million over the next four years, based on the assumptions built into the [county council’s Medium Term Financial Plan (MTFP)],” said John Hewitt, DCC’s corporate director of resources.

“The key message is even a cash flat grant settlement [from the government] and increased council tax levels, should that be decided, will not meet the cost pressures the council is facing and will require savings to be made.

“We’re likely to need a combination of savings and reserves to set the budget for next year.”

Hewitt was speaking at a meeting of the county council’s ruling cabinet.

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Of £12.8million which needs to be shaved from 2021/22’s spending plans, cuts worth £3.3million have been identified, leaving a shortfall of £9.5million.

The county council currently holds £16.4million in its Budget Support Reserve.

Total spending cuts over the last 10 years are expected to be just shy of the quarter billion mark by March next year (2021), with £244 million axed from the account books.

According to a report for councillors, the county is already facing mounting costs from social care, special educational needs and disability services.

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It adds that the COVID-19 pandemic has added a ‘further layer of complexity and uncertainty’.

“I think the only certainty we have is the uncertainty that we’re all facing,” said Alan Napier, the deputy leader of the council, who warned current pressures had ‘outstripped our ability to raise income’.

“We’ve known for sometime our income from council tax and business rates hasn’t kept pace with demand for services.

“We’re estimating savings of almost £43million over the next four years, although this assumes no further cuts to local government funding are made by the government.

“We can only hope this is the case.”

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