"Difficult decisions ahead" says Council Leader as budget discussions get under way

Councillor Bob Cook's comments come as the council sets out proposals to tackle a £2.6million hike in its annual energy costs and a £3.5million a year rise in costs for looking after children in care.

And once again, the council is setting its Medium Term Financial Plan for the next four years having received just a one-year financial settlement from Government, with the uncertainty of a potential local government funding review and reforms to national business rates also on the horizon.

Cabinet members will consider recommendations to increase Council Tax by 1.9 per cent and charge the Government's 2 per cent Adult Social Care Levy when they meet next week (Thursday, February 17).

They will also consider a recommendation to freeze councillors' allowances for the tenth year running.

"We know that any proposal to increase Council Tax will come as a blow - especially at this time of spiralling living costs and when a lot of people are struggling - and there's no doubt we have difficult decisions ahead," said Councillor Cook.

"To protect those who would be hardest hit we are introducing our new Council Tax Reduction Scheme in the coming financial year, which will see around 7,000 low income households pay no Council Tax at all.

"We're also mindful that people in Band A to D households will receive a one-off 'Council Tax rebate' of £150 from the Government this coming year, though of course we wouldn't have to put Council Tax up in the first place if the Government grasped the nettle and gave councils a fairer funding settlement over the medium term. Instead we're still getting one year settlements - it makes it impossible for us to plan ahead.

"And we still have the Government's Adult Social Care Levy being added on to Council Tax bills for a sixth year in a row, despite the Prime Minister saying in his first speech when taking office that he would fix the national crisis in adult social care once and for all. This essentially amounts to the Government getting local councils to ask local taxpayers to foot the bill for a national problem - naturally councils then get all the flak.

"I will continue to join council leaders from across the political divides in pushing the Government for fairer funding because it's the only way to free councils of this annual 'rock and a hard place' cycle where we either put Council Tax up or cut services and worse still, we're left having to make these decisions from a financial cliff edge."

The spiralling cost of looking after children in care - particularly those in children's homes and foster placements - is one of the biggest budget challenges faced by the Council.

This currently costs the Council over £20million per year and the Medium Term Financial Plan includes a proposal to borrow £6million to fund schemes aimed at driving those costs down.

"There are currently 548 children in our care and there is no duty we take more seriously than that we have as a 'corporate parent' to those children," said Councillor Cook. "Like any parent, we want what is best for them.

"What we're very keen to do is accommodate as many children as we can in placements within the Borough, where they have family and friends to support them, rather than somewhere further afield, which is also more costly.

"Through our joint venture partnership with Spark of Genius we've developed three children's homes and are achieving savings of around £860,000 per year but more importantly, we're looking after more children in homes within the Borough.

"This £6million investment would allow us to take that further.

"It would mean we could explore opening more children's homes - either through the existing joint venture model or our own 'in house' service or a combination of both - and reduce the number of children looked after outside of the Borough even further.

"We have a strong track record in this field, with all of the children's homes we're involved in holding 'good' or 'outstanding' Ofsted ratings. We do this very well and if we invest further we can support more children right here.

"The cost savings would also be significant as every out of Borough and private sector placement cost around £135,000 a year as opposed to around £100,000 a year for in house placements."

Band D Council Tax in Stockton-on-Tees is currently £183 lower than the national average.

The recommended increase in Council Tax of 1.9 per cent and Adult Social Care Levy of 2 per cent would add an extra 86 pence per week to bills in Band A in 2022/23.

"Though we'd rather not increase Council Tax at all, an increase at this level would keep Council Tax rates in Stockton-on-Tees in line with the average across the five Tees Valley authorities," said Councillor Cook.

"It's also important that people don't think our budget pressures are down to COVID. We've had one-off Government money for that and we're sensibly carrying some of it into the coming year.

"It's sensible because there's still so much uncertainty about what will happen next and the recovery from the pandemic won't happen overnight - it will be a long road that will need funding support over a period of time.

"And of course, one-off money is one-off money - it can help councils balance the books in a given year but it would be foolish to factor it into our budgets over the medium term because doing so would throw councils into crisis the moment it stops.

"The benefit of the COVID money we've had is that COVID-related costs are not directly impacting on Council Tax in the coming year. What is impacting on Council Tax are things like the hike in energy costs and rising children's social care costs."

As well as highlighting mounting cost pressures, the budget also includes ongoing investment in the Borough's schools, roads, and town centres.

"We remain very ambitious for the Borough and we're not standing still," said Councillor Cook. "We're continuing with our £52million investment programme in schools, which comes at a time when our schools are performing incredibly well.

"We're also pressing ahead with our investment across our town centres and are supporting this with additional spending on enforcement in town centres too, which is something we know people feel strongly about.

"We've committed extra money to roads resurfacing and potholes repairs, and targeted street cleaning and grounds maintenance work.

"It's also worth noting that year on year, external auditors give us a glowing bill of health, praising our financial management and most recently declaring that we are delivering 'economy, efficiency and effectiveness' in our use of resources.

"Of course, like all councils we continue to put relentless focus on making savings and this budget report outlines plans to carry out another senior management review that will save us another £200,000 per year on top of the £1million in annual savings we've already achieved through previous reviews."

The Council's 2022/23 budget and Medium Term Financial Plan for the following three years up to 2026 will be considered by Cabinet on Thursday, February 17.

Cabinet will then make recommendations to full Council, which meets on Wednesday, February 23 to set the budget and agree the Medium Term Financial Plan.