Councils issue tax warning

COUNCIL bosses spoke yesterday of the major challenges facing them next year after the Government revealed its provisional settlements for 2006/07.Although the grants were much better than anticipated, many councils across Suffolk said the cash would not cover all of the services needed and warned further efficiency savings would have to be made.

COUNCIL bosses spoke yesterday of the major challenges facing them next year after the Government revealed its provisional settlements for 2006/07.

Although the grants were much better than anticipated, many councils across Suffolk said the cash would not cover all of the services needed and warned further efficiency savings would have to be made.

Ipswich Borough Council received a provisional net increase of 4.9% in its settlement, which represents £516,000.

John Carnall, portfolio holder for finance, said: “It was better than expected but it doesn't by any means cover the pressures that are facing us in the borough council; oil and gas prices, pension contributions, the new licensing regime established by the Government, a range of health and safety issues, community safety issues and homelessness.


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“It looks as if the Government is not covering the full cost of the concessionary fare scheme for pensioners. The figure we have got indicated the council tax payer will be contributing towards the cost of that in Ipswich.

“If we are going to deliver a low council tax increase next year - no more than the rate of inflation - we will have to look closely at efficiency savings and cutting bureaucracy which is exactly what we did this year. We are still faced with a challenging situation.”

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Babergh has received a provisional settlement of just over £5.5m for 2006/07, which represents a 6.6% increase on last year.

Cllr Nick Ridley, chairman of the strategy committee, said: “Babergh's provisional grant settlement is helpful but by no means a cure.

“Babergh still faces major challenges in meeting its service priorities and the need to keep any council tax increase as low as possible.

“Hard choices remain, therefore, as to how our limited resources are allocated. At the same time, Babergh will continue to seek out annual savings in the order of hundreds of thousands of pounds.”

However Mid Suffolk District Council, which has received a settlement of £5.8m for next year, said it was pleasantly surprised at next year's grant.

Cllr Ivan Lockett, portfolio holder for finance, said: “Mid Suffolk District Council's grant from the Government for next year is a pleasant surprise.

“The increase of 11% puts us back to where we were in 2004/05, when we had a cut of 5%.

“In real figures, the increase has to pay for free bus travel and the increased costs licensing, so we are having to provide more services with this grant than we have in previous years.”

There was a similar message at Suffolk Coastal, which has got a 3.8% increase in its government grant.

Council leader Ray Herring said: “The provisional announcement from the Government is not as bad as we feared and will mean that we are another £100,000 nearer closing the £1m budget gap that we were facing for the coming financial year.

“I am confident that we can bridge the gap and still continue to provide most if not all of the quality services that our residents both expect and deserve, but it is a continuing battle.”

Officials at Forest Heath District Council described this year's settlement - a 3% increase on last year's grant which equates to a total of £155,000 - as “disappointing”.

They said every area would have to be examined in an attempt to keep council tax increases to a minimum.

At St Edmundsbury Borough Council, this year's rise stands at 3%, compared with an increase last year of 4.5%. However, officials said the grant had yet to be confirmed by the government.

Sara Mildmay-White, cabinet member for resources, said: “We'll be looking at what effect this will have on next year's budget and we can then assess the impact it will have on council tax.

“We still need to continue taking a detailed look at every area of our budget to come up with efficiency savings which will help to keep council tax rises down to sustainable levels.”

Waveney District Council leader Mark Bee said: “Whilst we welcome an increase in funding we are disappointed with the overall figure.

“A significant proportion of the grant is set aside for the concessionary fares scheme which cuts into revenues available for other purposes and overall we still face a financial strait-jacket in our battle to improve outcomes for the people of Waveney,” he said.

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