East Sussex County Council is set to use more than £14 million of reserves to balance its budget in the coming year. The use of reserves comes as part of the authority’s wider financial proposals, including a council tax increase, which are due to go in front of councillors next month. These plans were discussed by cabinet members on Tuesday January 23.
Pressure on local services
Introducing the proposals, Cllr Nick Bennett, lead member for resources and climate change, said: “Despite our strong track record of service delivery and financial management … there is a significant and growing financial gap due to factors outside of local control. Also, despite significant lobbying from across local government, the autumn budget in November and provisional financial settlement in December provided no additional funding beyond what had already been indicated. Instead there was a message from the minister for local government to use reserves to maintain services. In this context and with ongoing pressures on services we face very significant financial challenges going into next year and beyond, which means for the first time we are presenting a balanced budget that relies on using reserves.”
Council tax to rise by maximum allowed
The full proposals also include plans to once again increase council tax for East Sussex residents. When including the additional adult social care precept, the county council’s share of the bill is set to increase by 4.99 per cent. This increase, which is the maximum amount available without holding a local referendum, will see an average band D household pay the county council £1,778.31 next year, £84.51 more than this year. The full council tax bill will be larger as both Rother District Council and Rye Town Council, together with the police and fire authorities, are also preparing to increase their precepts.
Reserves plan attacked
Concerns about the use of reserves were raised by David Tutt, leader of the council’s Liberal Democrat group. Directing comments to Conservative council leader, and member for Rye & Eastern Rother Keith Glazier, Cllr Tutt said: “I don’t know if you can remember just how many times you have stood up in this chamber and told people that it is not a wise policy to draw on your balances because … your reserves can only be used once and it creates a larger problem going forward. Yet we have government telling us to do exactly that and that is the proposal you are putting before us today. I’m looking beyond this year’s budget and strategically I wonder what the Conservative Party’s strategy is. Nationally, I believe it is quite clear; it is that there is going to be an election … and the indication from the opinion polls is that the Conservatives are going to lose the election. So I think their strategy is we’ll leave this problem for the next government. But I wonder what the policy is locally … so I ask you if you can share with us what your strategy is for 2025/26 and beyond, because you can’t take this £14.3m out again.”
In response, Cllr Glazier said: “I am not here crystal ball gazing. I am actually concentrating today on setting a budget for the people of East Sussex for the coming year. But rest assured, should there be no changes, we have a process that we go through and we’ll start that very early next year, to see what actually is going to be deliverable. We’ve had 10 years of austerity and taken £139m out of the running costs of this county. We’ve done that very successfully, whilst protecting services for the people of East Sussex. If you want to broaden it out and go crystal ball gazing, let’s see what you’re going to do with this year’s budget and then we’ll worry about the rest after that.”
More concerns for financial future
The council’s other political parties also shared their worries. Johnny Denis (Green) said: “We know it is exceptional circumstances that were bound to happen eventually because of the pernicious cuts to local government over many years, putting all the burden on to our local taxpayers. But at the same time the government is offering tax cuts. It is shocking that that is the case, but I know that our officers here are doing the best with terrible circumstances. Clearly the government needs to come up with a plan. It hasn’t got one. It has refused to have one and it seems to undermine local government at every possible call and it is time for a change for that.”
Labour’s Godfrey Daniel was more sceptical of the administration’s aims. He said: “I’ve been coming here for many, many years chair, as long as you have and … I can never remember a time when you wanted to use reserves. In fact, usually, you’ve had a go at … us in other parties who wanted to use reserves to help soften the blow. I think what has changed and why the government has done that is that there is an election this year. Your party is in charge of the government and you don’t really want bad news in East Sussex of cuts. I don’t think this has anything to do with the announcement saying spend your reserves. I think this is your party, locally, trying to put the best face on things so when there is a general election this year there aren’t these cuts in the programme.”
Criticism for opposition
Cllr Glazier said he found Cllr Daniel’s claim to be “offensive” a view which seemed to be shared by other Conservative councillors. Cllr Colin Belsey (Con, Eastbourne – Ratton) was among those to criticise the views of opposition members. “None of us want to use reserves, I don’t argue that … but when the Conservatives took over East Sussex from what was a coalition local government in those days, Labour and Liberal Democrats etc, the bucket was empty.”
The next full meeting of East Sussex County Council is at 10am on February 6.
Image Credits: Robin Webster CC , Keith Glazier .
I dont comment on whether its appropriate to use reserves or not but using £14 Million of reserves means that interest on that amount will not be able to be earnt and at say at 5.5% thats approx 3/4 of a million every year going forward .
I think the nail was hit soundly on the head several times during this article… But rather than focus too much on the scorched earth, energy really needs to be focussed upon what comes next… The unfortunate reality is we’re in a ‘blood, toil, tears and sweat’ moment, and whomever is in power post the General Election, there’s going to be no time for party political fanfares and triumphalism. Whatever the administration looks like, the challenge will be the same, so the more cooperation and consensus and the less pointless political antagonism, the better for all of us.