Torridge Councillors agree £5.34 / 2.99% Annual Council Tax Rise for 2023/24
Torridge Councillors met at Full Council this week to agree and set the level of Council Tax for the 2023/24 financial year, against a backdrop of continuing decline in grant funding from Central Government. The approved increase of £5.34 will represent a rise of less than 10p per week for the majority of Torridge residents while those in receipt of council tax support will be shielded from any rise in liability. The Torridge figure is at the lower end of increases already confirmed, which includes increases of £69.18 from Devon County Council, £13.32 from Devon and Cornwall Police, £4.75 from Devon and Somerset Fire, and £3.18 from Parish Councils £3.18 which combined will make up the majority of the overall rise residents will see in their bills from April.
The financial report to members highlighted further reductions in Government funding and support, which amongst other figures noted that the Rural Services Delivery Grant was not uplifted by inflation for the third consecutive year and the new homes bonus was just £141K, which by contrast had previously delivered £2 million in funding in 2016/17. While a new Funding Guarantee Grant has been introduced to ensure all councils have at least a 3% increase in their core spending power (CSP) this falls well below current levels of inflation, hovering around 10% at the end of January. CSP is the income the council obtains from Council Tax, retained Businesses Rates and Central Government funding.
The Councils projections through to 2027/28 indicate a deficit in each year with a cumulative deficit of £860K under current funding arrangements. While the deficit over this period will be funded from the Transition in Government Funding Reserve (TGFR) held by the council further savings or income growth will be required in future years to balance the budget. Councillors were reminded that Central Government when allocating its funding to Councils assumes Councils will raise their Council Tax each year up to their referendum limit. If this were not followed this would result in Torridge moving from a positive balance of £494K in the TGFR by 2027/28 to being overdrawn by almost £250K.
The vulnerability of the Council's budgets was also highlighted should the goal posts move more significantly than currently predicted with interest rates, pay awards, inflation, utility costs adding to the unpredictability of planning in the current climate.
As well as reduced funding and inflationary pressures Torridge is also facing cost pressures, primarily inflationary (fuel, utilities, pay etc) and in particular the housing support it provides to residents at risk of homelessness, as the affordability of rented accommodation continues to diminish for many on low incomes. Supporting residents in need of temporary accommodation now totals around £1.3M per annum with an assumption that this figure will be required each year over the next 4 years.
In further debate Torridge Councillors voted to support a revised five year £27M capital spend programme, which includes ongoing building and infrastructure maintenance as well as asset renewals and replacements. New projects added to the programme have included the purchase of Sully House in Bideford to provide increased hostel accommodation and a site for modular units aimed at reducing expenditure on temporary accommodation costs. They also included the new Appledore Clean Maritime Innovation Centre, which was one of the regional winners when awarded a £15.6M grant from the government in levelling up funding in January.
Councillor Ken James - Leader of Torridge District Council said:
"To a large extent council tax levels set by Torridge make up only a small proportion of resident's bills with 92% of what people pay dictated by the levels set by Devon County Council, the Police, and Fire services and Parish Councils. But Central Government funding assumes that Councils will have maximised their Council Tax Income in line with referendum limits. If we did not do this the council would end up overdrawn, which would affect our ability to fund important front line services that many of our residents depend on.
Even the maximum allowed referendum limit for Torridge of £5.34 or 2.99% is significantly below current inflation levels of over 10% so we will still have to find other savings or increase other returns to achieve an equilibrium. We will continue to lobby the Government for a more generous funding formula for rural Councils, where the costs of providing services are often higher than in cities. At the same time the member budget working group set up by councillors will continue to explore the most efficient way to deliver these services or improve income. We'll continue to build on the £852K boost to our bottom line that this group have already identified and that the council plan to realise over the next four years."
21 January 2023