'Cuts to all services' as Shropshire Council needs to slash £14 million from budget
A further blow has been dealt to Shropshire Council’s finances with a £14 million gap found in the budget.
The council says there will be cuts to “all services” after the funding gap was identified by the authority's financial director.
James Walton said funding adult social care and children's services had become “unaffordable and unsustainable”.
It comes just weeks after council leader Peter Nutting announced a spending freeze until the end of 2019 and said he would be keeping a “close eye” on recruitment.
He also ruled out dipping into council reserves.
But the stark reality of the financial situation has now been laid bare in a report to cabinet members.
Mr Walton said: “Adult social care is growing by £8m to £10m each and every year and is unaffordable and unsustainable.
“Inflation in this sector accounts for at least half of this growth. New and innovative models of delivery must be created to reduce growth in this area.
“Children’s social care is growing by up to £5m every year and is unaffordable and unsustainable. New models of delivery are essential to stem this growth.
“The budget has been reviewed and updated with all known information, and there is now an additional funding gap of £14m in 2020/21.
“This £14m must be found, and the plan is to recover this gap through innovation and transformation to create new models of delivery across the council.
“The council can only deliver a balanced budget by cutting costs in all services to fund increasing social care provision.
“The alternative would be a combination of more government funding, higher council tax and new models of delivery in social care.”
He added: “The council cannot set a sustainable budget; there is no information available beyond the pre-election, pre-consultation, pre-settlement funding outlined for 2020/21.
“Growth in social care costs is not sustainable; every year costs increase by up to £15m, outstripping the ability to raise resources locally due to the limitation placed on council tax rises (a two per cent rise generates less than £3m).
“One-off funding, distributed as government grants, is insufficient to meet the current levels of growth.
“Put simply, the council cannot currently raise enough income through council tax increases or by other means to meet the increasing cost of its services, particularly social care.”
Mr Walton said the council has less money as grants are being cut but costs are growing.
He added: “The local taxpayer is having to pay more to receive less.
“Over the last four years the council’s net budget has fallen from £216m to £214m.
“With the impact of inflation this means spending on services has had to be cut.
“Four years ago, 55 per cent of the council’s net budget was funded by council tax (£119m) but in 2019/20 that has grown to 72 per cent (£154m).
“This places a greater burden for funding services on the local taxpayer.”