Provisional Budget Aims to Protect Major Investments and Frontline Services Despite Pressures

THE Council’s provisional budget aims to protect both frontline services and flagship investments in better facilities for residents, whilst continuing to absorb additional costs caused by the pandemic and pressures in adult social care.

The overall impact of a second year of the Covid 19 pandemic won’t be known for some weeks however, pending the final announcement of the Local Government Finance Settlement by Government and additional work by the Council to close a £3.3m budget gap for next year.

Reading Borough Council is considering an interim budget on Monday December 13 to allow for a period of public consultation ahead of final budget setting in February.

The provisional budget shows major investments such as £40 million on modern new leisure facilities, including two new swimming pools, £9 million on Reading’s biggest ever road resurfacing programme, £20 million on the new Green Park Station, £3.2 million on refurbishing Reading West Station and £7 million on further energy saving measures towards its 2030 net zero carbon target, all remain untouched.

The Council’s commitment to delivering Reading’s biggest council house building programme in a generation is also fully maintained in the draft budget. More than 300 high quality and sustainable affordable new homes are set to be built over the next four years.

Provision is made for the people who need the Council’s help the most. £43 million is being invested in modern and fit for purpose sheltered housing for older people, and supported accommodation and day facilities for vulnerable adults.

All of these major investments are set to be maintained in the context of an ongoing Covid 19 pandemic which continues have a major impact on Council budgets everywhere, with increases in service demands and associated costs, and reductions in income. In Reading, income levels remain significantly down on pre-Covid levels. Supporting grants from Government to offset the pressures are likely to come to an end this financial year.

Additional demands on adult social care services are also having a major impact.  Around £5 million extra is being built into the draft adult social care budget in Reading next year. This includes the cost of funding care providers at a level which allows them to pay staff at the rate recommended by the Living Wage Foundation, rather than the Government’s lower national living wage. The Council’s commitment recognises the acute staffing crisis which exists in the care industry at a time of huge additional pressures.

The update to the Council’s three-year Medium Term Financial Strategy, to be discussed at Policy Committee on Monday December 13, is provisional as it comes in advance of the Local Government Finance Settlement, which has not yet been announced. It is based on a 2% Council Tax rise and 1% Adult Social Care precept for next year (2022/23). The report can be found at: https://democracy.reading.gov.uk/documents/s20267/Budget%20and%20MTFS%20Report.pdf

Reading Borough Council Leader Jason Brock said:

“This is a provisional budget which looks to maintain every one of our flagship investments and protect the frontline in the face of some of the biggest challenges local government will ever face.

 “The Covid pandemic follows a decade of austerity which has already pushed every council to breaking point. Local government has absorbed unprecedented cuts in funding which mean it has become increasingly reliant on fees and charges to operate. That same income has now been heavily impacted by Covid and as we approach the end of the second year of the pandemic, uncertainty remains as to how long council budgets will be affected.

“This is, of course, exacerbated by huge additional pressures for adult social care teams everywhere. Despite repeated Government promises, a realistic funding solution remains a very long way from being delivered. This Council’s aspiration has always been to help people live more independent lives and allow them to remain in their own homes for longer, but real concerns remain about whether, and when, councils will receive enough of a share of the Government’s increase in National Insurance contributions to put these vital local services on a firm financial footing.

 “Reading has proved its resilience over recent years. It has built itself into a position of being able to maintain major investments in infrastructure projects - like two new swimming pools, new road surfaces, new and refurbished train stations, hundreds of desperately needed new affordable homes, modern new sheltered housing for older residents, and even more energy saving and carbon emission reduction measures - despite the incredible pressures.

“Our commitments are now being recognised on the national stage. Last week, the Council was voted UK Housebuilder of the Year. The previous week, Reading was named as one of just 10 local authority areas in the UK - and one of just 95 in the world - to have made the ‘A list’ of towns and cities taking the lead on environmental action.

“Council investments are about so much more than just boosting what is already a powerful local economy. Every bit as important is ensuring everybody in the town can share in Reading’s success. We know our strong economy sits alongside areas with lower incomes and higher unemployment, which makes Reading the third most unequal place in England. Along with our partners, we are creating more apprenticeships to open new doors for young people. We are putting pressure on more employers to join the Council in embracing the real Living Wage and we are empowering Reading’s incredible voluntary and community sector to create new opportunities and pathways for people which would not otherwise exist.”

Cllr Brock added:

“Rising energy prices, increasing inflation and the Government’s introduction of additional National Insurance contributions from April, alongside stagnating wages, mean people are quite understandably worried about the cost of living. This draft budget includes an enhanced council tax support scheme from April next year, which would see the Council’s contribution to council tax bills rise from 65% to between 70 and 75% for those eligible.”

Between 2017/18 and 2020/21 Reading Borough Council has successfully delivered savings of £41.2 million. Proposed savings of £6.1 million and additional income of £0.8 million are currently proposed for the next financial year (2022/23). £3.3 million of savings and income is still required to close the gap for 2022/23 and deliver a balanced position ahead of budget setting in February next year.

Overall savings of £15.6 million, £3.7 million of which relates to the Council’s wholly-owned Children’s Company, Brighter Futures for Children, including additional income of £1.9 million, is proposed over the three year period of the Council’s Medium Term Financial Strategy.

If agreed at Policy Committee on December 13, a one month public consultation will run from December 14 to January 14. Further reports will then go to Policy Committee on February 14 recommending the approval of a balanced budget and associated Council Tax level to Full Council on February 23.