Highest possible council tax rise for Leicestershire residents and other key changes amid 'toughest ever budget'

In-depth reaction from Leicestershire County Council’s budget meeting
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Leicestershire residents will see the portion of tax they pay to the county council go up by the highest possible amount in April.

Councillors approved the 4.99 per cent increase, which works out at £76 more next financial year for those living in Band D properties.

The full rise – which equates to three per cent towards general spending and an additional two per cent towards social care costs – will bring in around £18 million for the council. Districts and borough councils, as well as the police and fire service, also collect tax from residents in the county.

Leicestershire residents will see the portion of tax they pay to the county council go up by the highest possible amount in April.Leicestershire residents will see the portion of tax they pay to the county council go up by the highest possible amount in April.
Leicestershire residents will see the portion of tax they pay to the county council go up by the highest possible amount in April.

While Conservative-run Leicestershire County Council said council tax was a hugely important revenue stream for it, it has previously warned that the increase would not even cover the £20 million more it will be paying in 2024/25 in staff costs from pay rises. In fact, the authority has said that this year it is facing its “toughest ever budget”, and for the first time will need to take around £6 million from its reserves just to balance its books – something it is legally bound to achieve.

The tax hike and reliance on that emergency pot of cash comes in addition to huge savings needing to be made by the council over the next four years. Despite planned savings of around £81 million already having been identified, the council has said it is still facing a budget gap of £83 million by 2028.

The authority has said around 200 staff roles could have to be cut to bridge that gap, but added that staff turnover and vacancy management would mean that the number of compulsory redundancies would be “much lower”.

What the council leader said

Leader of the council Nick Rushton remained defiant in this week's budget meeting, but admitted the decisions made were “angst-ridden” and tough. He said: “We will not ever go bankrupt, we will not ever be serving a S114 notice. We will not ever be in that position because it is bad, we don’t want to do it, we’re a proud county and also because bringing in commissioners serves no one, serves nothing.”

He added: “We will make difficult decisions and they will be politically difficult. This budget is not easy for any of us, it has been angst-ridden that we can’t do a lot of what our residents want because we are that short of money. But we can promise our residents we are open and honest and we do not seek to hide anything from them.”

“In our original manifesto three years ago we promised to protect the vulnerable,” he added. “We have stuck to that manifesto commitment and it is increasingly hard to honour that commitment with the lack of money that we’ve got.

“We are super-efficient, the second or third most efficient council in the country. But we cannot just rest on our laurels. We have got to innovate and we have got to make further savings. It will continue to be tough. But we will do the best for the residents of Leicestershire with the money we’ve got.”

Not all bad news

However, it is not all bad news in the county. Additional Government funding of £5 million means the planned closures of two county tips have been halted. Leicestershire County Council was previously considering closing the tips at Market Harborough and Shepshed in a bid to save money.

Instead of closing the two sites completely, it is now proposing to have them open for fewer days a week. The Shepshed tip could now be open just two days a week, while the Market Harborough tip will be brought onto a shared timetable with the one at Kibworth which means between them residents in the area will have access to a waste site seven days a week. A consultation into the new proposal is expected to go live this month.

A third tip at Somerby, south of Melton, was also in the firing line and is still expected to close. Most of the changes to opening hours for all other tips in the county previously consulted on are also expected to still go ahead.

The council has also set aside an extra £400,000 to help it combat flooding in the county over the next four years after around 500 homes were left underwater in the wake of Storm Henk at the start of the year. A further £2.7 million is set to be targeted at maintaining roads and fixing potholes, while additional funds will be targeted at improving bridges across the county.

This budget is the latest in a run of difficult spending decisions by the authority, which said it has saved £262 million since 2010. However, thanks to those decisions, it added, it is not “at crisis point”.

Reaction from the other parties

However, opposition members took the opportunity to question the priorities of the council’s leadership and the Government. Leader of the Liberal Democrats on the authority Michael Mullaney said: “This is a budget that will cost people more and deliver them less. At a time of a cost of living crisis that’s hitting so many hard, Leicestershire residents are to be hit with a £76 increase in council tax at a time when they will see many services cut back.

“Leicestershire continues to be the worst county council in the country by this Conservative government. If we were funded to the median level of all county councils, we would have an extra £120 million and just imagine how that would transform what we could do as an authority.”

Councillor Amanda Hack, leader of the Labour group on the council added: “It’s a tough one, it’s been tough for many years, and we need change. But change is driven by budget.

She also questioned the council’s priorities, questioning whether the leadership is investing where the money has the most “social value”. She raised cuts to libraries, community grants and the decision to dim street lights earlier in the evening as examples of socially important areas where the authority has reduced funding in recent years.

Call for more flood prevention and bus cash in Leicestershire budget voted down

The Liberal Democrat opposition put forward an amendment at this week's budget meeting, calling on Leicestershire County Council to increase funding for bus services and flood prevention – which was rejected.

The Lib Dems said their proposals were “fully costed”. The group’s amendment asked the council to scrap its magazine called Leicestershire Matters and plough the £100,000 a year they claimed would be saved into local bus services instead.

Leader of the opposition Michael Mullaney added that people in his constituency of Hinckley, as well as those in Barwell and Earl Shilton, were “hit hard” by the scrapping of the number one and number two services that linked them. He added that many residents were also impacted by the council withdrawing funding from the 159 service connecting villages such as Barlestone, Market Bosworth and Newbold Verdon.

He said: “During these tough times financially, spending over £100k on a magazine can’t be justified. That money should be used to support local bus services instead.”

However, leader of the council Nick Rushton countered the proposed amendment, saying the magazine was an “excellent way to make sure residents who are not online stay up to date with what is happening in their areas”. He added that the budget for the magazine had “already been reduced from £750,000 to £108,000”. Some 78 per cent of people who receive Leicestershire Matters said it was useful, he claimed.

Coun Rushton said: “I think for £108,000 it is particularly good value for communicating with all residents of Leicestershire, but particularly those who aren’t as up to date with the internet and modern forms of technology. For £108,000 I honestly think it’s money well spent.”

A second amendment was also filed by the Lib Dems’ finance spokesman Simon Galton calling on the council to pour more money into flood prevention measures. Much of the county was left underwater at the start of the year after being battered by Storm Henk.

The local authority is already proposing to set aside £400,000 for flood prevention work as part of its budget. The Lib Dems were proposing additional money be freed up by cutting “political support posts” – where elected members support the council’s cabinet leads with their duties – from the authority’s payroll. They said the council already had excellent officer support and advice via non-political council officer roles, and these rendered political appointments unnecessary.

Coun Galton said: “Put simply, we believe tackling highway flooding problems is more important than political support posts. The cabinet already has excellent officer support and advice and we don’t think political posts are necessary especially when the council is having to cut front line services to residents.”

Coun Galton also referred to the support members as “baggage carriers”, a term that drew outrage from both those in the role and the cabinet leads they support.

Councillor Maggie Wright, who supports lead member for highways Ozzy O’Shea, said: “Although Ozzy is quite a superman, I know working for him over the past three years, he doesn’t physically or mentally have enough hours in the day or week to do the amount of work or growth that has come into in his portfolio. I do believe my role does make a difference.

“I sit on the regional flood committees, by being on that that is driving forward transformation and bringing more money into Leicestershire to support our residents and to get mitigation into place. If I wasn’t there, Ozzy would have to give up something equally important to do this.”

The two motions were rejected, with councillors voting along party lines.