Suffolk demands more support from Treasury in budget plea

In a letter to the chancellor, county council deputy leader Richard Smith outlines the financial crisis facing Suffolk with pressures from social care, school transport, and special needs provision.

He warns that councils across the country could face bankruptcy without a big injection of funds from central government - but says the government should rule out forcing local authorities to put up council tax bills significantly.

The letter says: "The council feels it essential that the pressures facing local authorities are fully recognised by government and reflected in the local government settlement.

"It would be of great concern if, instead, the government chooses to lift the council tax referendum limit and pass the cost to local residents."

Back in 2003 the then Labour government changed the funding formula for councils - meaning more had to be raised from council tax rather than central government grants.

Across the country council tax bills rose dramatically. Suffolk County Council put its council tax bills up by 18% - and other councils had much higher increases.

Rachel Reevespresents her first budget on Wednesday. (Image: House of Commons/UK Parliament/PA Wire)

This forced future governments to introduce a cap on council tax rises and if an authority wanted to exceed that it would have to win a referendum among. None has ever been passed.

Recent caps have been fractionally under 5%  - but there have been suggestions this could be raised significantly to give councils the chance to raise funds without falling back on central government support.

Mr Smith's letter is a clear warning against such a move - but he does paint a grim picture facing local councils in the years ahead.

He says: "In Suffolk, we have a particular challenge with the cost of social care, home-to-school transport and special educational needs and disabilities.

"Our ‘need to spend’ in children’s services has increased by 28% and adult care 14%.

"But with council funding only increasing by around 6% this year, it is evident that our budget gap is growing so significantly as to render efforts to maintain a balanced budget almost impossible.

"Our overall budget this year is £752m - of which £105m alone is down to cost 
pressures caused by inflation and increased demand.

"This year and next, we are making £65m of savings to the county council’s budget by cutting staffing, further changing the way we work, stopping funding for community activities and raiding our ever-depleting reserve funds. 

"Let me be clear, we are a well-run council and over the last five years, we have saved over 
£66 million by working smarter and leaner.

"Indeed, 77p in every £1 we now spend goes on caring for and supporting adults and children.

"But the financial pressures we now face mean we need to go even further. There are still more savings to identify and these relentless year on year budget gaps are increasingly unsustainable, risking our ability to deliver vital services for our communities."

One thing the council does know it will be getting money for is bus services - supported by the rise in the cap on fares from £2 to £3 in January.

However it has not yet had any indication how much of the £925m being made available for bus services is coming here - and the indications are that most of that will be going to urban areas with a higher bus usage than rural counties like Suffolk.

The cap is administered directly by the Department for Transport - but the government has said that some of the extra money raised will be allocated to transport authorities like Suffolk to support bus services.

Further details of this scheme are likely to emerge following the budget statement.