Council confronts £43m budget gap due to unprecedented cost rises

Members of Kirklees Council’s Cabinet have put forward their budget proposals for the next financial year amidst “unprecedented” increases in inflation and energy costs.

The council says it faces a budget gap of £43m as it approaches the new financial year.

To balance the books, senior councillors propose to deliver £19m in efficiency savings across council services in the next financial year. They also want to use £25m of from their reserves as part of a £373m annual net revenue budget.

Cabinet members argue this strategy will safeguard frontline services while addressing the massive increase in costs the council faced during 2022 and into this year.

Their plan includes a rescue package for leisure centres which were forced to close in December.

Councillor Paul Davies, cabinet member for corporate services, said: “The last financial year has been one of the most turbulent anyone can remember.

“The cost-of-living crisis and economic mess have put enormous pressure on the council’s finances. This budget brings stability in challenging circumstances.

“If the past year’s economic turmoil has proved anything, it’s that budgets need to add up. That means taking tough decisions and being honest about the challenges.

“That’s why our plans mean savings in virtually every part of the council. We will focus those savings on back-office operations to minimise any direct impact on residents.”

Alongside funding for day-to-day services, the planned budget will continue to invest in the local economy with £191m in capital spending for Kirklees in the coming year. This will feature work to improve infrastructure, roads and renew the local economy.

Last year the council put in place emergency measures to reduce costs. These included a reduction in recruitment and a review of how the council’s buildings are used.

These controls on budgets will continue into the new financial year with savings to be found from managing staff vacancies and by cutting building costs.

Cllr Shabir Pandor, leader of Kirklees Council, said: “Our budget puts the council on a sound financial footing but we need change, at a national level, to safeguard services in the long term.

“The historic underfunding of Kirklees must end and our whole sector needs a long-term solution to social care costs. We also need the kind of investment in our infrastructure that stimulates a thriving economy. Without these kinds of changes, we will be heading into a new era of austerity.”

If endorsed by a meeting of all Kirklees councillors next month, the budget proposals would mean an increase in council tax of 2.99% with an additional 2% raised through the Government’s Adult Social Care Precept to fund services for older and residents with disabilities.

The budget proposals will be debated by the Cabinet on 21 February. If endorsed, they will be presented to a meeting of all councillors for debate on 8 March.