Cumbria County Council has agreed to freeze its share of council tax in 2012/13 at its annual budget meeting held in Kendal.
After a debate over the pros and cons of accepting the Government's offer of a one-off £ 5.1m freeze grant, councillors opted to accept the grant and freeze the county council's share of council tax next year.
Those opposed to accepting the grant pointed out that it will leave a deeper hole in the following year's budget as the Government grant is a one-off payment that does not increase the council's funding from Government in future years. Therefore, in addition to the £ 5.7m savings the council would have had to make for 2013/14, there will be a need to find an additional £ 3m to make up for the loss of Government grant.
Those in favour argued that it was not fair on Cumbria's tax payers to increase council tax bills in the current economic climate and the council has a duty to keep the council tax as low as it can for as long as it can.
Having voted to accept the freeze, with a vote of 51 councillors approving it and 22 opposing it, the council then agreed a budget which sets the county council's share of the charge on a Band D property at £ 1,161.50 for the second consecutive year.
The budget agreed at Full Council assumes that council tax will increase by 3.5% in both 2013/14 and 2014/15 to help make up some of the shortfall left by accepting the freeze grant in 2012/13 - but this will be subject to any thresholds on council tax rises set by the Government.
The total revenue budget (excluding funding for schools) is £ 353.842m for 2012/13, down from £ 364.5m in 2011/12 and £ 383.3m in 2010/11.
Capital expenditure has been set at £ 116.4m in 2012/13, including investment to provide new school places in Carlisle and Penrith, a new facility in Barrow for homeless 16/17 year olds, a new fire training facility and a further half a million pounds to extend the council's programme of upgrading beds in Cumbria Care to Dementia Gold Standards.
More than £ 25m has been set aside for schools in the capital budget in 2012/13, including £ 6.7m for the West Lakes Academy and £ 9.8m for the Furness Academy. A total of £ 25.9m has been set aside to maintain the highways network, £ 16.1m of this has been devolved to local committees, putting Cumbria at the forefront of councils which allow truly local decision making.
The total capital programme for the next three years stands at £ 222.6m.
An unprecedented level of savings has also been mapped out in the council's financial plans, with £ 20.2m of savings needed in 2012/13, on top of the £ 44m already saved in 2011/12. The medium term financial plan agreed at Full Council also lays out the need to deliver a further £ 10.5m savings in 2013/14, followed by a further £ 13.9m savings in 2014/15. As each of the annual savings needed are cumulative and roll in to the next year, it means that the total amount of savings being delivered every year by April 2015 will be £ 88.7m.
The budget also contains provisions for the county council to contribute to the £ 4.4m Cockermouth Flood Risk Management Scheme. The majority of the funding is being provided by the Environment Agency, but the entire cost of the scheme has not been covered, so the county council has agreed to work with local partners to ensure that the funding gap of £ 700,000 is closed and the scheme can go ahead.
Cllr Stewart Young, Deputy Leader of Cumbria County Council and Cabinet member responsible for resources, said:
"Deciding this budget has been a trade off between lower council tax today and further cuts in our budget tomorrow. Although the Labour Group was opposed to accepting the freeze, as Cabinet member responsible for resources, it is my duty to deliver a budget that can be approved by the council. We will now have to work even harder to find more efficient ways of delivering services our even stepping back from services which we are not statutorily required to deliver. Cuts of more than £ 88m will not be a case of doing more for less, but a case of doing less for less.
"At the end of this difficult process we will be a smaller organisation, but we will still be meeting the needs of the people of Cumbria each and every day from the start to the end of their lives. We do so because these services are important and are relied upon not least by the weakest and most vulnerable members of society."
Full council also agreed a Council Plan proposed by the Leader Eddie Martin, which has shaped the overall budget and continues to focus the council's core priorities on challenging poverty, protecting the most vulnerable, and improving the life chances of the most disadvantaged.
Cllr Martin said:
"We need to give our support to those who need it most. We must grow ourselves out of poverty and fill our young people and others with bold ambitions. And we must do this at a time of unprecedented change for local Government. The scale of the change is truly frightening. I have spoken about a 'financial tsunami' in the past, but it has well and truly hit us and it will not stop rolling for the next three or four years. I will therefore be working hard to persuade Government to increase the base budgets for local Government or the consequences could be more serious than any of us can currently imagine."
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