Fears for services as council faces �300m deficit

LOCAL Government finances are in their worst position since the 1960s with Essex County Council potentially facing a �300million budget deficit within five years unless urgent action is taken, it has been claimed.

Roddy Ashworth

LOCAL Government finances are in their worst position since the 1960s with Essex County Council potentially facing a �300million budget deficit within five years unless urgent action is taken, it has been claimed.

Lord Hanningfield, leader of Essex County Council, blamed the authority's predicament on an unprecedented series of factors that could have potentially major consequences for the delivery of local services across the entire country.

He said the council was facing increasing costs while at the same time it was looking at a significant reduction in income, particularly following the next Comprehensive Spending Review from government grants and also from its own sources of income.


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Factors demanding extra funding include the county's growing elderly population, land fill tax, the increasing cost of child protection and the unexpected depth of the current recession.

The council estimates that if it does not take action now then it will be faced with a budget gap in the region of �50m in 2010/11, rising to around �300m in 2013/14.

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Lord Hanningfield said that as a direct result ECC has identified the need to change and is looking at every part of its operation to reduce bureaucracy and back office processes in order to divert resources to front line services.

He added the council is on target to meet the �200m it has pledged to save over the next three years.

Total efficiencies and savings of �59m were achieved in 2008/9, with a further �80m planned for 2009/10.

But he said: “These forecasts need to act as a wake-up call to the entire public sector.

“Doing nothing is not an option. We must change and modernise if key public services are not to be reduced or simply cut altogether.

“We are fortunate in Essex that we have identified the need for change and are embarked on a major programme of modernisation to continue to provide the very best services for residents.

“I have also made a commitment to keep council tax to an absolute minimum in order to help families during this recession which again is why we need to look at every part of our operation and drive out inefficiencies.”

Lord Hanningfield said that redundancies would be avoided where possible but that some staff would probably face retraining and redeployment.

Use of expensive agency staff would be lessened and some posts would not be replaced when their holders retired.

“We are looking at moving away from bureaucracy and back office functions and providing the frontline services the public want and deserve in Essex.

“There won't be much less in terms of staff, but some will be doing different things,” Lord Hanningfield said.

Yesterday the Liberal Democrat deputy leader at County Hall, Mike Mackrory said: “We accept that there are demographic changes in place, and we understand the implications of the landfill tax.

“Having said that, we would stress the absolute need to protect and involve the most important asset we have, our staff.

“They have to be involved and this has to be transparent.

“We have also pointed out that the county council has significant reserves.”

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