The leader of Bristol City Council has warned of “scary numbers” as local public services face a growing shortfall of funding. But “some good news” is expected at the end of the month as the new Labour government announces its budget.
The council faces an estimated £52 million budget gap next year, after a decade and a half of austerity measures coupled with rising demand for services. But local authorities could get some indication that extra help is on its way on October 30, in the new budget.
Later in the year too, councils across the country could finally be promised a much-needed cash boost. An update on how the council’s finances might fare over the next five years was given to councillors on the cross-party strategy and resources policy committee on Monday, October 14.
Green Councillor Tony Dyer, leader of the council and chair of the committee, said: “Some of the numbers in this report are very scary. We don’t expect the end of October budget to be providing us with magic money trees. At the same time I do think there are indications that there will be some good news.
“For us, we’re probably looking more towards the local government financial settlement, which will give us further information. Looking beyond that is the comprehensive spending review, and the indications are that there may be an opportunity for us and other councils to input into that in more detail.”
Shortly before Christmas every year, the government lets councils know how much money it will give them for the next financial year, beginning in April. This financial settlement provides councils with a large chunk of their funding for day-to-day spending, and impacts whether local services can be improved or have to suffer cuts.
Despite Labour winning the general election in July, the “picture for local government finance remains bleak”, according to a key council document. The medium term financial strategy looks at all the rising costs the council must pay, combined with its predicted income. This sets out how much can be spent on public services in Bristol next year.
The document says: “A sustained period of high cost inflation — with limited changes to core funding after years of austerity measures resulting in years of savings requirements — and continuing unprecedented demand pressures, particularly in children, adults and temporary accommodation services, have led to councils struggling with in-year financial pressures and challenging budget gaps to manage.”
The council’s shortfall is forecast to grow, as the cost of running services rises faster than income from the government and council tax. Next year, the funding black hole is expected to hit £51.6 million, rising to a whopping £68.4 million in four years. This is largely due to extra demand for services like social care, which is “far exceeding levels previously anticipated”.