Search

More cuts 'inevitable' as council tries to fill £10m budget black hole

PUBLISHED: 08:05 11 June 2019 | UPDATED: 10:56 11 June 2019

Families enjoying the weather in Waterloo Park. Norwich City Council has warned it may have to only provide 'core' services in the future. 'Non core' services include park maintenance. Picture: Jamie Honeywood

Families enjoying the weather in Waterloo Park. Norwich City Council has warned it may have to only provide 'core' services in the future. 'Non core' services include park maintenance. Picture: Jamie Honeywood

Archant

Cuts to more services in Norwich are "inevitable" as the council tries to fill a £10m black hole in its budget.

Norwich City Council has said more cuts are Norwich City Council has said more cuts are "inevitable". Photo: Archant

Norwich City Council warns in its latest accounts that it needs find another £10.4m over the next four years. Its annual budget is around £150m.

It said it had built up "significant" reserves which will cover some of the gap but it will still need to cut services, in some cases to the core.

The council is sitting on general reserves of £11.6m and has £1 billion in assets, which are mainly council homes.

It also owns 200 investment properties such as shops and offices worth £43.5m, which give it an income of £2m a year.

It wants to borrow millions more pounds to buy more commercial properties which will give it an income, in the face of the money it gets from the government being cut.

But using that rental income and its reserves will only cover about 30pc of its budget gap, meaning the hole will grow from £5m next year to £10.26m by 2023.

The accounts warn: "It is almost inevitable therefore... this council will need to cut or reduce general fund services in the medium term and move towards the provision of core statutory services only."

The council has already had to make £33m of savings in the last eight years.

You may also want to watch:

Core services include bin collections and housing, while 'non-core' services include funding the arts, leisure centres and parks.

Council taxes are also likely to keep rising to fund the gap.

The accounts also reveal that the council will borrow an extra £129m to finance projects, but only where it will create savings or produce an income, such as buying commercial property.

Paul Kendrick, Norwich City Council cabinet member for resources, said: "It is our intention to protect all our services and we have robust plans in place to do this.

"In recent years we have focused on efficiencies, smarter ways of working and investing in property as ways of raising money.

"In order to keep essential services running we will continue to draw on the reserves we've built up in the years to come.

"While we've planned ahead with our finances to give us greater resilience and a more secure position compared to some councils, we've still lost an average of 60 per cent of funding from central government in the last 10 years which means the challenges all local authorities face will become increasingly tough."

Ben Price, a Green Party councillor, attacked the government for cutting council budgets but added: "I am concerned that councils are being forced into making investment decisions for purely commercial reasons.

"I don't believe that local government should be financed in this risky manner. It's important that public money is invested in ethical and sustainable projects rather than being purely at the mercy of a volatile marketplace.

"We would have liked to have seen the Labour administration exclusively base their commercial portfolio on local sustainable projects that build a low-carbon future for Norfolk while generating an income."

Most Read

Most Read

Latest from the Eastern Daily Press

Hot Jobs

Show Job Lists