Provisional Council Budget Update Delivers Modern New Facilities and Protects Frontline Services

MAJOR investments in modern new facilities for Reading and frontline services are both protected in the Council’s provisional budgeting assumptions, despite the testing economic conditions.

Increased costs associated with the highest rate of inflation for 40 years, reduced council income due to the impact of Covid and ongoing social care demands, have combined to create a perfect storm of financial pressures for local councils.

Ahead of the Local Government Finance Settlement later this month, Reading Borough Council is well-placed following years of sound financial planning. While savings are still required to balance next year’s budget, and those of future years, the Council intends to fully deliver on all of its planned flagship infrastructure projects for residents. This is despite additional contractual inflationary costs estimated at £8.3 million next year, plus £3.2 million set aside for future pay increases.

Major Council projects include a continuation of Reading’s biggest ever road and pavement repair programme, the completion of modern new swimming pools and leisure facilities, the opening of new and refurbished train stations, building hundreds of new affordable homes, new sustainable transport initiatives, new and refurbished playgrounds and investments on a range of low carbon initiatives.

In the continued absence of a sustainable national funding solution for adult social care services, the Council has had to increase the budget for caring for elderly and vulnerable residents by £4 million next year.

An enhanced council tax support scheme, subsidised by the Council and introduced last year, remains in place under proposals. Residents can check if they are eligible at  www.reading.gov.uk/council-tax/ or go to www.reading.gov.uk/money-matters/ for updated information on support and advice.

And in the context of a cost of living crisis which is impacting on deprived communities the most, the Council is proposing to maintain vital financial support for voluntary sector organisations in Reading, to help it reach and support communities and residents who are struggling with poverty and inequality. The funding pot remains at £1.375m for each of the next three years and includes a small grants pot, doubled last year to £200,000, which will support small grassroot organisations in Reading.

While the Government recently indicated that local authorities can raise Council Tax by 5% next year (3% Council Tax and 2% Adult Social Care precept), a final decision on the Council Tax rise in Reading will not be made until budget setting in February, following confirmation of the Local Government Finance Settlement.

Reading Borough Council’s provisional Medium Term Financial Strategy Update will be considered at a meeting of the Council’s Policy Committee on Thursday December 15 https://democracy.reading.gov.uk/ieListDocuments.aspx?CId=138&MId=4971 If agreed, it will go out to public consultation ahead of a final budget returning to Full Council on February 28.

Jason Brock, Council Leader, said:

“This is a provisional budget update which continues to deliver tangible improvements for Reading residents in the face of enormous challenges for local councils.

 “It is also the result of many years of hard work to stabilise the Council’s finances, ensuring that we are now well-positioned to weather the combined storm of inflationary pressures, reduced income due to the pandemic, and increased demands for the essential social care services we provide.

 “You do not need to look too far afield to witness neighbouring councils having to consider unpalatable cuts in the face of these pressures, whilst others have declared themselves bankrupt. Following a decade of austerity, and rather than providing councils with a realistic and sustainable funding solution, the Government has instead told them to raise Council Tax, placing the burden for protecting essential public services directly on those people struggling with their own household budgets.”

Commenting on a provisional capital programme of Council investment which totals £169 million on core services plus £137.9 million on housing, totalling £306.9 million over the next three years, Cllr Brock added:

“In spite of increased costs associated with soaring inflation, in Reading we will keep our promise to deliver modern new facilities for residents. We are extending our biggest ever programme of road and pavement repairs. A modern new pool at Palmer Park is now weeks away from opening and will be followed next year by Reading’s brand new flagship pool and leisure centre at Rivermead. Our brand new station at Green Park, a welcome addition to matchday travel for Royals fans, opens to the public next year following Network Rail’s commissioning process, and we will have completed the station transformation at Reading West together with rail industry partners.

 “As we push towards our 2030 net zero carbon target, we are providing realistic alternatives to the private car by building major new segregated cycle lanes, and in the new year we will announce details of a major package of investment in our award-winning bus services. This sits alongside a raft of investments in low carbon initiatives, including the continued electrification of the Council’s vehicle fleet, low-energy, low-cost new streetlights and air quality schemes.

 “We are investing millions in more than 360 new affordable Council homes – including for key workers like social workers, nurses, teachers and police, as well as for older and vulnerable residents on Battle Street and Hexham Road. Existing Council tenants will benefit from a major retrofitting of homes to make them more energy efficient and cheaper to heat. For younger residents, our major programme of playground equipment replacement continues across Reading.

 “And as the cost of living crisis bites into household budgets, I’m proud that we will maintain our financial support for Reading’s incredible voluntary sector, whose role in helping us to reach and support those living on low incomes, as well as tackling widening inequality, becomes more essential in the difficult time ahead.”

As well as the package of capital investment planned for the next three years, the Council’s provisional Medium Term Financial Strategy Update includes projected revenue savings required up until 2025/26.

£5 million of savings and income have already been earmarked for 2023/24, with an estimated funding gap of around £2.4 million to be addressed ahead of budget setting in February. The savings are being delivered through more efficient delivery of services, including the Council’s new leisure contract and improved IT systems. There is some additional recovery in those lower income streams resulting from the pandemic, as well as some new sources of income. Overall savings of £9.6 million have been identified over the three year period of the MTFS, with more than £12 million still to be identified.

Between 2017/18 and 2021/22, Reading Borough Council successfully delivered savings totalling £55.5 million.