Sunderland council tax set to rise by 4.99% as chiefs struggle amid rising costs

Council taxpayers in Sunderland are set to see bills rise again in 2024 as city leaders try to balance the books amid rising costs.

Sunderland City Council said inflation, combined with rising demand and costs in adult and children’s social care, are continuing to put pressure on budgets.

Senior councillors on the city's ruling cabinet are due to discuss updates, forecasts and budget planning at a meeting on Thursday, October 12.

City leaders admit in a report that they are already planning to raise council tax by 4.99% from April, for the 2024/2025 budget.

The rise, which includes a 2.99% core council tax rise and 2% 'social care precept', is the maximum allowable under Government regulations.

The local authority said Sunderland’s council tax will be decided in early 2024 and council budget planning is assuming a 4.99% increase 'in line with the Government's direction'.

Officials stressed Sunderland's council tax, which raises around £16 for every £100 in the services budget, is the lowest in the North East region.

Cabinet Secretary, Councillor Paul Stewart said: "We are continuing to invest in our city and make it more healthy, dynamic, smart and vibrant, but just like households and businesses, the council’s finances are coming under more and more pressure.

"All councils are experiencing the impacts of high inflation which is compounding the cost of living crisis, and also the legacy impact of Covid-19.

"Our social care services are continuing to experience both demand pressures around complex cases and cost increases from providers."The current forecast overspend for the day-to-day services budget this year is £1.197million.

This is after taking into account the use of £9million of reserves which the council agreed to use as part of this year's budget.

Forecasts outline that the council has a funding gap of nearly £20million for spending on day-to-day services in the next year financial year of 2024/2025 reducing to £10.3million after using reserves, and a total gap of over £51million over the next four years.

Cllr Stewart said: "Every year it gets tougher to decide on where and how residents and businesses are helped and supported with vital services across our city.

"These decisions include the bigger unresolved matters of how demand is rising for helping vulnerable adults and young people. 

"Our population is ageing and all councils are suffering because of big and unanswered national questions on how the country deals and funds the increasing demands for social care.

"This year the city council agreed a total gross budget of £759.8million for its day-to-day spending, including £201million or more than a quarter (26%) of the total budget being used for adult social care.

Ten years ago, in 2013/2014, the budget for adult social care was £114.8million or 17% of the budget.

Consultation with residents and businesses about next year's budget is being prepared and due to begin in coming weeks.