Shropshire Council's cabinet has agreed to consult on its financial strategy for the next five years but it comes with a stark warning that 97 per cent of rate payers will find themselves paying more money for reduced services.
The council's chief financial officer described the situation with government funding as "unsustainable", while Councillor Gwilym Butler, the authority's cabinet member for resources, said "things have to change".
During a meeting of the cabinet, Councillor Butler warned of the impact of the council's £50 million 'structural funding gap' – the difference between the amount it has and the amount it needs.
Councillor Butler said they had met the county's MPs in the past two days to explain "in no uncertain terms", the situation facing the council.
The council is even using £13m of its reserves in a bid to plug the 2021/22 gap, and £7m the following year – eradicating its 'Financial Strategy Reserve'.
Councillor Butler has warned that highways, rubbish collections, swimming pools, libraries, and other services, could all face cuts in light of the situation.
He said: "We are unable to plan properly for the medium term on our revenue spend as our settlement for the government is still only for one year and all the grant funding is noted as one offs and not continual base budget. We cannot be guaranteed we will have any of these budgets in 2023/34 onwards.
"This leaves us in uncharted waters and we have already started lobbying our MPs to influence central government policies to ensure out structural government deficit is addressed on a permanent basis.
"In Shropshire I predict we will spend 80 to 85 per cent of our disposable budget on care net year.
"To clarify that, most of that care is for children and adults under 65 and this represents the changing demographics of society in the third decade of the 21st century and I strongly believe the government need to recognise this.
"So if we are spending 80 to 85 per cent on care this only leaves 15 per cent for highways rubbish collections swimming pools libraries etc. It will not be enough for those services to continue as we know them unless we get an increase in our base budget."
Councillor Butler added: "Until the government addresses social care funding direct to local government or take the services into the NHS we are at a stalemate.
"Irrespective of your politics this has been avoided by all governments for the past three decades – things have to change."
A report from the council's finance officer, James Walton, laid bare the situation facing the council, stating: "To almost 97 per cent of local taxpayers there remains a simple and unfortunate reality: they pay more money to the local authority in Council Tax, fees and charges yet receive reduced services.
"This cannot continue, but requires Government intervention and, ideally, a complete overhaul of the funding mechanism to create fair funding across the Local Government sector."