Council that proposed 15% council tax hike underspends

8 May 17

Surrey County Council, which proposed a 15% council tax hike earlier this year, has revealed it underspent by £6.7m in the last financial year.

Leader David Hodge told Surrey County Council’s cabinet savings had been made possible by avoiding further spending commitments, efficiencies and “one-off measures”.

Although, the council still ended 2016/17 £16m short of its savings target - the council cut £66.4m from its budget against a target of £82.9m.

Hodge said in the cabinet meeting on 27 April it was “the seventh year in succession that this council has achieved a small underspend or a balanced budget”.

He said the recent cost-saving measures taken had turned the council’s position around from that of 30 September last year, when it was expected to end the year with a revenue overspend of £22.4m.

Although, a report to the cabinet stated: “One-off measures do not address the fundamental issue of service overspends particularly in social care.

“These overspends are driven by: the increased numbers of those who need services, the increased complexity of their needs and the increasing costs of meeting those needs."

Surrey County Council had considered holding a referendum to ask the public permission to raise council tax after it overspent its budget in 2015/16 by £15m and endured a £170m reduction in grants from the government since 2010.

The extra money was needed for the rising demand for adult social care, the local authorities said.

Although, it shelved the plans in February saying the government had listened to its concerns.

Hodge said at the time: “We are therefore willing to take a risk that a solution will soon be found to the issues that all councils face.”

Labour had accused the government of offering the council a ‘sweetheart’ deal to drop its council tax plans.

Jeremy Corbyn read out what he said were leaked emails in PMQs in February, which he believed showed Surrey council’s leader was negotiating a deal to call off the tax hike.

Surrey council - which remains in control of the Conservatives after last week's local elections - said “no deal” had been offered.

Hodge had also warned in February: “If there isn’t any progress in finding a solution to the adult social care crisis our situation will become untenable.”

Liberal Democrat leader at Surrey, Hazel Watson, told the Surrey Comet the council was planning cuts of £93m, adding that this would cause “more financial pain”.

She called on the government to provide more funding for local authorities, she said: “Robbing Peter to pay Paul is not a sustainable financial policy for the unrealistic savings’ targets for crucial services.

"What is needed is proper national financial help and more realistic financial planning.”

A report in March from CIPFA concluded council tax in England was set for its biggest rise in a decade.

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