Council Budget Balanced Despite Significant Pressures

South Tyneside Council has been able to balance this year's budget despite the cost of the coronavirus pandemic response and a shortfall in Central Government funding.

This year the Council needs to find a further £8m on top of the £175m it has already saved since 2010 due to a tight financial settlement as well as the impact of the Covid-19 pandemic.

Cllr Tracey Dixon, Leader of South Tyneside Council said: "This budget has been produced under the most testing circumstances that the Council and our communities have ever faced.

"Over the last 12 months, in addition to normal business, we have been focused on addressing the challenges of Covid, ensuring support services are in place to help those who need it and working hard to adapt to ever changing circumstances.

"We will continue to respond to the pandemic and do everything we can to help protect our communities from the virus, working hand in hand with our partners across the region."

This year budget proposals also include a spending plan of £360 million over the next five years on major infrastructure projects, such as sustainable energy projects and major road improvements. The spend in 2021 is set to be £99m, financed by a mixture of external funding, Government grants, borrowing and capital receipts from sales of assets. Harnessing all available external funding supports  value for money on every project.

Cllr Joanne Bell, Lead Member for Resources and Innovation said: "The challenge of Covid has been layered on top of the already existing financial stress that public services have been under for a decade. There is also significant uncertainty in funding going forward due to the pandemic and the absence of multi-year Government spending review. But we have focused on delivering services in new and innovative ways so that local people have access to the support they need.

"The Medium Term Financial Plan looks to improve the lives of our residents and begin to mitigate some of the impacts we have all felt in the last year.

"Place and people are at the heart of everything we do - from major regeneration projects to improving local areas and increasing support for older people so that more than ever they can continue to live in their own homes.

"We will continue to invest in our infrastructure and environment - prioritising action to address climate change by continuing to invest in flood defences and cutting-edge green technology to meet our energy supply demands with major schemes in Hebburn and Jarrow. The council will also receive the first full report of the Sustainable South Tyneside Climate Change Strategy, marking progress on our commitment to become carbon neutral by 2030.

"We will build on our reputation as one of the best children's services authorities in the country including expanding our special educational needs provision within the borough as well as expanding accommodation and support for people with learning disabilities.

"We will continue to improve and stay focused on not only delivering for, but also standing up for, the people of South Tyneside as we move into a post Covid world." 

The Council continues to press the case for fair funding from Central Government as well as the increased pressures in adult and children's social care which account for some 67 per cent of the Council's discretionary budget.

This year the Council is proposing a council tax increase of 3.95 per cent which is a combination of the Government's adult social care levy which is ringfenced for those services and an increase in council tax. This means an increase of 83p per week for an average Band A household of which the majority of homes in South Tyneside fall.

The Borough's ageing population is increasing placing huge pressure on services such as adult social care especially as Government funding continues to be reduced. This is coupled with increasing demand on services to protect and support vulnerable children.

Instead of a long-term funding solution or additional grant, the Government has permitted a percentage increase in council tax bills to be ring-fenced to assist in meeting rising adult social care costs.

The bill issued by the Council includes separate amounts levied by other statutory bodies such as police and fire. Tyne & Wear Fire and Civil Defence Authority and the Northumbria Police and Crime Commissioner are expected to be confirm their changes in February.

The Medium-Term Financial Plan will be considered by the Council's Cabinet on 3 February before being brought to Full Borough Council for consideration on 25 February 2021.