County council ponders how much to increase tax share

Lincolnshire County Council will put up its share of council tax, but is still to decide how much.

The authority says its facing a shortfall, but the most it can put up its precept (the share of the tax) is 4.99 per cent.

To do that it says it would also have to transfer £3.4m from its reserves.

It’s also been recommended it could put its share up just 2.99 per cent and cover costs by moving £10.3m of reserves.

The budget by executive director of resources Andrew Crookham, states: “As it stands, whichever council tax rate is set and based on the current figures, use of reserves will be required to balance the budget for the first time in five years.

“Whilst the government has signalled it will be monitoring reserve use in budget setting, and indeed is encouraging it, effective financial management principles dictate it must be proportionate and with purpose rather than plugging gaps that do not have sustainable plans.”

As part of the Medium Term Financial Strategy, the council is budgeting cuts of £11.5m for the 23/24 financial year as part of £23.3m cuts over the next four years.

One of the biggest increase is £11.7m in costs from adult care providers the council uses while a four per cent pay rise will cost an estimated £7.9m. Highways costs are expected to increase by £5.5m, the budget states.

Coun Martin Hill OBE, leader of Lincolnshire County Council, said in a statement: “Like households across the country, the council is facing steeply rising costs because of inflation, especially for road repairs. We also continue to see increasing demand for services, particularly adult care and children’s services.

“Thanks to our careful financial management over recent years, we are better placed than some to meet this challenge. However, we will again have to make difficult decisions in order to both balance the books and protect frontline services.

“We continue to find smarter ways of working, which we estimate will save more than £23m over the next few years. In addition, the government has recognised the pressures faced by local councils, and is providing some extra funding, including around £19m for social care.

“However, despite this additional money, we will need to draw on our reserves again. We have also taken the difficult decision to propose an increase in council tax. We realise that household budgets are already under pressure, but this is a vital step for ensuring the council’s long-term financial stability.

“We’ll continue to push government for long-term solutions to the major issues facing local councils. It’s vital that we start to see progress on fairer funding, the resetting of business rates and plans for making adult care more sustainable. We will also continue to work towards a devolution deal for Greater Lincolnshire, giving local authorities more control over funding.”