'Chilling': Councillors clash over projected £58 million Shropshire Council budget deficit

Opposition councillors have raised fears that Shropshire Council could be heading for financial ruin after the authority agreed its budget for the next year.

Councillors clashed over the budget agreed by Shropshire Council
Councillors clashed over the budget agreed by Shropshire Council

Members of the Liberal Democrats and Labour groups voiced their concerns, describing forecasts of a £58 million hole in the council’s budget by 2025 as “chilling”.

One councillor said they were deeply concerned that the authority was spiralling towards bankruptcy.

Council leader Peter Nutting said that while the financial position remained “strong”, more money was needed from government to give greater certainty going forward.

The council’s 2021/22 budget of £554.3 million was voted through as part of the council’s five-year financial strategy at a meeting of the full council on Thursday.

Councillor Nutting said the authority was in a good financial position despite challenges in recent years including the Beast From the East, flooding and the Covic pandemic.

He said: “The financial strategy does however highlight the fact that Shropshire Council receives lower funding than almost anywhere else in the country, on a per head basis.

“We also have more miles of road per person than nearly all other councils and receive far less cash than our urban neighbours.

“The government has a project called ‘fairer funding’ which is intended to even up funding for councils, but it keeps being delayed.

Stability

“If implemented fairly, it would give Shropshire Council a further £30 to £40 million of revenue funding that could really make a difference.

“There’s also a problem that we are only being told of our funding one year at a time, and really we need to have a three or four-year settlement to give some stability to our finances.

“The economy of Shropshire and Shropshire Council is in good hands, but with extra government funding we could do even more.”

Labour group leader Alan Mosley said the financial strategy was set against a backdrop of a decade of cuts to council services.

He said the report painted a “very bleak picture”, with “dire warnings written between the lines”.

Councillor Mosley said the most “chilling part” of the report was the projected deficit of £58 million by 2025/26.

He said: “It seems to me that as things stand, the council is on a pathway to bankruptcy.

“As things stand we are unsustainable and most of the mitigation about this is based on a wing and a prayer.”

Councillor Mosley said assumptions made in the financial strategy, including the fairer funding review, were not guaranteed.'I

'Shambles'

He added: “I fear for the future of our council and the services that we provide to Shropshire residents.

“This is not a sustainable budget. It has too many imponderables, too many imperfections and too many things we hope for but which are likely not to come about.

“This budget is a shambles, it’s incomplete. We should be afraid of the consequences of the Tory government and their policies and also afraid of our Tory leaders on this council and their supporters.”

Liberal Democrat group leader Roger Evans said the council was “heading into an abyss” under current financial projections.

He said: “I would like to take this opportunity to give notice that if we are in a position to form the administration after May, we will be putting forward a revised and very different budget to this one within 100 days of being elected.”

Councillor Evans said climate change would take “centre stage” in a Liberal Democrat budget which would “invest in the future of Shropshire”.

Councillor Julian Dean, the authority’s only Green Party member, said it was disappointing that opposition groups had not put forward any alternative budgets for consideration.

Councillor David Minnery, portfolio holder for finance, said he agreed that delays to the fairer funding review were “unacceptable” but added the budget was balanced and should be supported.

Leader Peter Nutting said it was easy for the Liberal Democrats to talk about the “fairytale” of what they would do differently, when they did not have the responsibility of actually handling the council’s finances.

He added: “I think this financial strategy is an excellent document and does reflect where we are at, and it does show the competence of the administration over the last four years.”

The financial strategy, including the 21/22 budget, was approved by 46 votes. Liberal Democrat members and the single Green member voted against, while the Labour group abstained.

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