Redcar and Cleveland Borough Council's Cabinet is proposing a freeze in Council Tax for the coming financial year.
A report, which will be considered by the Cabinet and then debated and voted upon by the full Borough Council, proposes a balanced budget for 2022/23 and a draft financial plan for the years to 2026/2027.
The Cabinet had previously agreed that the public and businesses should be consulted on a proposed 1.99% increase in Council Tax and also on a proposed 2% increase in the Adult Social Care Precept for the next financial year.
Following feedback from the public and businesses and concern about the current squeeze on household finances, the report proposes the 2% increase in the Adult Social Care precept from the next financial year, but recommends no increase in Council Tax.
Instead, the 2% rise which was initially proposed will be funded by a reduction in reserves provision and a slightly better than anticipated finance settlement from Government.
The Adult Social Care precept is needed to help fund continuing pressure in caring for older people in the borough.
The Government's National Insurance increase is not intended to help towards existing costs faced by local authorities in caring for older people, but will go towards funding future reforms to the system.
Areas where additional investment is required include:
- Adult social care – Redcar and Cleveland has an ageing population and to provide the necessary care and to support older people to live safely at home, extra funding will be required in each of the coming years. Additional funding will be required to meet national living wage rises in the care sector;
- Children's social care – as well as increasing general costs around children in our care, pressures in special guardianship orders, short breaks and home to school transport will require additional money in next year's budget;
- Waste – the Council is collecting increasing volumes of waste and additional investment is needed for both collection and disposal;
- Climate Change is one of the Council's key priorities and further investment is needed to move towards the carbon-neutral aims for the borough;
- Inflation, energy and National Insurance – the 1.25% increase in National Insurance rates from next April will add to the Council's pay bill along with increased energy costs and higher inflation, putting pressure on its budget.
Efficiencies totalling £4.21m in the years to 2026/27 have been identified to offset some of the additional funding required, including initiatives in both adults and children's social care to enable more children and older people to live safely at home.
Councils receive two funding streams – revenue, which funds day-to-day services and capital, which funds investment and growth. Capital funding cannot be used to fund day-to-day services.
Under its Capital Plan, the Council will continue to invest in the borough and to improve residents' quality of life. Initiatives in the budget proposals include:
- Eston Pool – an £8.765 scheme to replace the current pool;
- The Regent – completion of the project on Redcar seafront;
- Redcar Town Deal – developing plans for £25m of improvements in Redcar;
- Loftus Future High Street Fund – revitalising Loftus High Street and the surrounding area;
- Guisborough Town Hall – revamping and re-opening the building as a community asset and a gateway to the North York Moors.
- Levelling Up Fund Bid – a bid will be submitted in the Spring, with the intention of delivering significant additional investment in Greater Eston and Guisborough. The Council is planning to include the Eston Precinct scheme within this bid.
The Council will also invest to keep residents safe, provide the opportunity for better health and give young people and adults the skills they need for a better quality of life.
Cllr Glyn Nightingale, Cabinet member for Resources, said:
“Everybody in the borough is facing a huge squeeze on household finances and the upcoming rise in energy prices will be a huge burden.
“We have listened to what the public and businesses said during the consultation and we have decided to propose no increase in Council Tax for the coming year. We said we would listen, and we have done what we said.
“I said we wanted to help with the current family finance challenge and we have been able to do that. People who took part in the consultation were supportive in us investing to help adults who need our help and support, and that is what we are committed to do.
“The Council continues to come under huge financial pressure, particularly from the demands on our social care services and the increased costs of dealing with waste and recycling. Uncertainties about future developments in local government finance mean the Council will need to ensure its finances remain sustainable.
“Despite this, we have ambitious plans to make our residents' lives better and everybody can be assured that we will do everything we can to make that happen."
Council Leader Cllr Mary Lanigan said:
“We are acutely aware of the financial challenge families are facing and we want to do everything we can to help residents with this. At the same time, we must maintain the wide range of services they expect and need. We have more older people in our borough than in other areas and they quite rightly want to live long and independent lives. In many cases, older people require support to do this and it is very important that we continue to provide this.
“We are now proposing to freeze Council Tax and this will hopefully help the majority of our residents. We will continue to improve our services and to invest in the borough to make it more prosperous, to give people the chance of a better future and to improve the quality of life for our residents."