South Holland District Council faces a financial black hole of around half a million pounds every year between 2019 and 2022 as it looks to save over £1m in two years.
A report by the authority’s head of finance, Jane Crosby, to its cabinet says the Medium Term Financial Strategy (MTFS) shows a budget gap of £475,000 for the financial year 19/20.
That’s followed by gaps of £624,000 for the following financial year and £564,000 the year after.
As part of a long term cost cutting programme the district council is looking to make savings of £1.05m by April 2020 and is behind on its targets for savings.
The report states: “It will be necessary to identify savings in 2018-19 of £313k to address slippage in the overall programme and activity is underway on this.”
On the budget gap, the report says: “The on-going budget position has arisen largely as a direct result of the reduction and then loss of revenue support grant funding from the government.
“Members should also note that the MTFS does not assume the continuation of the business rates pilot into 2019-20.
“There are also some significant uncertainties around the level of future retained business rates.
“The baseline reset for 2020-21 presents a significant potential risk, but it is not possible to quantify what that impact will be at this stage.
“It should also be noted that the council now has no reliance on New Homes Bonus. (The council was awarded £1.007m of the bonus for 2018/19.)
“The council has a number of future projects which are being developed which will provide opportunities to address future funding pressures.
“These include further reviews of the council’s services and assets including further co-location opportunities, potential joint venture opportunities, income from commercial investments, a review of fees and charges etc.”
Coun Peter Coupland, the district council’s portfolio holder for finance, said: “The cause for the shortfall in funding has come about over the years because of the loss of grant funding from the government.
“It amounts to a difference of £700,000 a year and we’ve got to plug that gap.
“Our Moving Forward programme is about being more efficient and creating money through different financial aspects.
“We’ve provided a balanced budget and we need to look ahead a few years to see which shortfalls we might come across so we react to them rather than waiting for them to just smack us in the face.
“All at the council want to keep providing the services we do. We want to keep collecting weekly black and green rubbish bags. Picking up one a week would save us hundreds of thousands but it’s a service our residents want.”
