Budget: Colchester Council ups council tax and faces £2m shortfall

As more than £2 million looks to be wiped from Colchester Council's budget from central government, its portion of council tax will rise for only the second time since 2010.

The full council voted in favour of the budget as it stands so the tax will increase by £4.95 per Band D property to £185.13, up 2.75 per cent.

This is in addition to demands from Essex County Council and the police and fire authorities.

Colchester Council leader Paul Smith said: “There is no doubt councils are facing some very difficult and serious financial pressures, as a result of the government reducing their funding.

Leader Paul Smith near the Northern Gateway site

“Nevertheless, this is an excellent budget that will enable us to continue to invest in our priorities for the borough and support residents in the best ways possible.

“Residents can be reassured the council is fully committed to the prudent management of its resources and commercial assets, and we are looking at every option available to save money, generate income and continue to deliver on our promise to protect vital services, increase investment and create more growth in the borough.”

Despite a continuing squeeze on the council’s finances, the 2018/19 budget includes a number of recommendations to continue investment and spending in key areas.

These include a proposal to allocate just over £1 million to deliver strategic projects, £750,000 for the Northern Gateway sports project, £250,000 to the Revolving Investment Fund, and £147,000 on housing projects.

The budget also aims for spending on new capital investment, including £2.9 milllion towards buying properties for use as temporary accommodation.

Speaking at yesterday's full council meeting, deputy leader Tim Young (Lab), called it a sound budget which is "for the many and not the few".

And Mark Cory (Lib Dem), responsible for resources, said the council is delivering a "prudent, balanced budget".

Councillor Mark Cory is thinking about Colchester's future

He continued: "A budget that protects frontline services, infrastructure, the environment and wellbeing of our communities.

"We have had record wage growth amongst Colcestrians, an increase in small and large businesses across the borough, as well as a record number of business units registered in 2017.

"And yes, this budget does require a small council tax increase, but let me explain why.

"In 2010/11 Colchester received £11 million in revenue support grants. In this year's budget we received £275,000, that's a cut of £10.725m or 97.5 per cent.

"Over the same period in 2010/11, our Band D property costs was £175.23. In this year's budget, it will be £185.13, that's a £9.90 increase.

“I feel that's a much better situation for Colchester residents than other councils we’ve seen."

Conservative leader Darius Laws was congratulated by several councillors on his amendment

Mr Cory, who rejected Conservative Party leader Darius Laws’ amendments, went on to highlight a £3 million investment for emergency housing and homelessness announced last month, and the authority’s success in building new council homes, creating apprenticeship schemes and jobs, business incubation, and increased wages.

The senior councillor also praised investment to Castle Park, the Northern Gateway – “attracting £10 million of external investment and encouraging participation in sport” - and making Leisure World “open for all while delivering vital income targets".

Other plus points were delivering “record carbon reduction plans” ahead of time, record recycling figures plus offering pub relief and small business rate relief.

He commended the Conservative’s “interesting ideas” as part of their budget amendment, which he said he was happy to listen to "provided they were properly costed".

The future at Northern Gateway's sports complex 

He added: "This amendment wants to spend money we don't have. It wants Colchester to go backwards to the ways of the past.

"This administration budget looks to the future, celebrating our past but putting Colchester on a path to success."

Information released today by Colchester Council, details a £645,000 reduction in the revenue support grant, as part of the government’s four-year settlement.

READ MORE: WE'LL BRING BACK WEEKLY WASTE COLLECTIONS

Reforms to New Homes Bonus payments means this grant will reduce by £1.34 million next year, with further reductions of £1.3 million forecast in the following three years.

However, the council says these are not the only cuts it faces when costs from inflation, pay assumptions, additional employer pension costs and revised income assumptions are taken into account.

The 2018/19 budget includes plans to generate more money and make further savings despite the budget reductions.

To listen to the full debate, click here.