Sunderland council chiefs have warned of the “perilous situation” around the authority’s funding which could lead to services being scrapped in future.
This month’s Sunderland City Council cabinet discussed a major report on its budget planning framework for 2019/2020.
The report is looking at a possible 3.99% increase in council tax for the next year, in line with Government limits on Council Tax and Social Care Levy increases.
It also warns council chiefs may have to cut another £50million from budgets over the next three years.
City council cabinet secretary, Coun Paul Stewart, speaking at Sunderland Civic Centre, said austerity was continuing to impact councils across the North East and warned of “significant cuts” in coming years.
He also called on opposition Conservative and Liberal Democrats groups on the council to “work together” with the Labour leaders, noting uncertainty around future funding, Brexit and cuts to council services.
“We’re at a point now where services will just simply stop as there is no point of having a poor service,” he said.
“It’s not a position in relation to this council, it’s across the country.”
Main budget pressures for Sunderland City Council included continued increases in looked-after children, with leaders having to potentially dip into reserves in future to balance the books.
Council bosses agreed to release £3million this year to support work at Together for Children (TfC) which delivers services on behalf of the council – a sum agreed earlier this year.
A report, presented to cabinet, stated that current budget position predicts an ongoing budget shortfall of £12.1million for TfC into 2019/2020 with the company likely to need more funding.
It adds “work is being progressed within TfC to develop a suite of efficiency savings for 2019/2020 which will help support the company financial position going forward”.
Council leader Graeme Miller added local authorities were facing a “perilous situation” following eight years of council cuts under government policy.
“The fact we have to tax the public through council tax and social care levy increases is terrible as it will hit the poorest,” he said.
On the revenue budget, he added: “It shows the stress we’re under, the fact that we’re coping is to be applauded but it’s not a great place to be.
“I agree with concerns but until there is a change in government, we’re going to be stuck with what we have. I think we have done a tremendous job to get that revenue position to where it is.”
The council’s planned spend for 2018/19 was £646million on public services for the city’s 277,962 residents.
As part of the budget setting process for 2019/20, there will be a public and stakeholder consultation with more details confirmed in the coming weeks.
The final decision on council tax – which raises 15% of the council’s budget – will be made in March next year.
Chris Binding , Local Democracy Reporting Service