County councils need to make £1bn worth of savings in order to cope with ‘unprecedented’ financial pressures, county council chiefs say.
New research by the County Councils Network (CCN) and the Society of County Treasurers (SCT) shows that inflation is set to add £1.6bn to county council budgets next year. This follows high price rises last year which increased council costs by £1.41bn in 2022/23.
CCN said that councils will be forced to find efficiencies and reduce services, but warned that this would have to be accompanied by council tax increases.
The research by CCN and SCT shows that council tax is set to rise to £2,140 on average for residents in county areas next month – a rise of over £98 for the typical Band D household.
For the 40 county and rural councils in the analysis, this will bring in an extra £820m, with the average Band D household in those county areas facing yearly bills of £2,140 in 2023/24 – an increase of 4.8%.
CCN said that the additional funding provided by the Government in the budget had helped to significantly reduce inflationary pressures. However, it urged the Government to recognise the higher costs of delivering services in the local government finance settlement later this year.
Cllr Carl Les, CCN Finance Spokesperson, said: ‘The additional funding provided by the Chancellor at the Autumn Statement made a big dent in the unprecedented new costs councils face in 2023/24, but unfortunately it was not enough. This analysis shows the scale of the financial challenges facing county authorities to remain solvent, with councils having little option to raise council tax.’
‘The medium-term outlook looks bleak unless these higher costs are recognised and councils are given longer term financial certainty, alongside delivering long promised fair funding reforms,’ he added.
