Cambridgeshire’s council tax set for maximum rise amid £16m budget gap

Cambridgeshire County Council’s portion of the council tax bill is set to rise by the maximum amount allowed this year following budget recommendations.

The council’s Liberal Democrat and Labour joint administration leaders claimed they had no option but to consider the 4.99 per cent rise in order to close the authority’s £16m budget gap this year. They acknowledge that this rise may be very difficult for some families to afford.

And they warned that next year’s funding gap is likely to be even worse as they “try to keep the council afloat”.

County council leader Cllr Lucy Nethsingha (Lib Dem, Newnham) said: “We are very aware of just how stretched many residents and households are at the moment. But the council’s own situation is very difficult. And it’s really important that we try and make sure that we’re not hitting vulnerable residents even harder by withdrawing services from them at the same time that they’re able to heat their houses.

“So actually what we’re trying very hard to do in this budget is make sure that the support is in place for those most vulnerable households.”

She added the council would continue to fund free school meals in the holidays and keep the household support fund for those on Universal Credit.

A 4.99 per cent tax rise would mean an extra charge of £1.04 per week for a Band B, and £1.19 for a Band C household. More than half of all homes in Cambridgeshire are in these two bands. It said local government experts who visited in summer highlighted that historic decisions not to raise council tax in previous years had led to significant ongoing lost income to support services.

“When we took control of the council in May last year, we were left with a potential budget gap of £86m by 2027 if we don’t take action now,” said Cllr Nethsingha, who is also chair of the strategy and resources committee. “We invited in an independent and cross-party team of local government experts in July to review the council when we took office. They highlighted this as an issue ‘of significant magnitude’ for us.”

Deputy leader Cllr Elisa Meschini (Lab, King’s Hedges), explained that after the government removed the revenue support grant funding for councils, the budget situation had become more precarious.

She said: “For the medium term, we have funding gaps of between £15m and £25m for the years 2023-24 and 2024-25… We hope it doesn’t fail, we’ll try and keep it afloat. But the reality is we are (floating) with our noses out of the water, and we’ve been with our noses out of the water for quite a while. It is a scary year next year. We’ll have to work very hard on how to deploy what we have.”

The council’s joint administration – which took over last May when the Conservatives failed to retain their overall majority – is also proposing to set up and spend a £14m fund over the next five years to tackle inequality, improve lives and care for the environment.

The council consulted residents at the end of last year about spending priorities. It visited a representative sample of residents at home and launched an online survey.

In a statement, the council said this “showed firm public support for helping people live more independently, tackling inequality, and responding to the climate crisis”.

The council’s strategy and resources committee on January 27 will consider proposals for the fund as part of plans to deliver on a proposed new vision and ambitions which also include a set of new priorities for the council. In its first year, if agreed, the Just Transition fund will fund schemes that:

• Increase flood prevention in the county, continuing a recent rapid increase in gully clearing;

• Help tackle climate change;

• Widen opportunities for children with special educational needs and disabilities;

• Increase independent living services;

• Expand direct payments and individual service funds – where adults assessed as needing support can choose and manage their own care services; and Expand the ‘Care Together’ programme, providing care services close to where people live

It will then make recommendations to the committee, to be put forward for discussion by Full Council as it sets the council’s budget for 2022/23 on February 8.

Opposition group leader Cllr Steve Count (Conservative, March North), responding the announcement, said: “There is very little to be surprised about by the joint administrations budget. We always predicted they would ‘tax to the max’ and this has been the cornerstone of their approach to financial planning this year. Their proposals to increase Taxes by 4.99% (Let’s round it up to 5% shall we) increases the revenue position by £16.483m.

“What I have found is their lack of transparency and difficulty in reading the document means that some matter are not obvious. (Ask why the reserves table page 57, did not include the budgeted reserve position for the current year for comparison). Such as they intend to increase General reserves by £6.9m, put another £2m into an earmarked just in case reserve, which makes up more than half of the proposed Tax increase.

“They also want to create other reserves where there is little real chance of a call on them, the high needs deficit offset of £14.4m and some of the various covid expenditure related items totalling another £6m.

“It will take some time to go through the document in detail, but Taxing residents far more than necessary to simply put money into reserves, is a sad starting point.”