'Sad reality': Leader warns of higher costs as cabinet approves first council tax rise in two years

Council proposals for the next financial year include a council tax rise - the first in two years - to meet the rising costs of delivering adult and children’s social care and homelessness services.

The council’s cabinet today approved recommendations which included making a further £17.567 million of savings.

Council leader Shaun Davies said that there were no alternatives being offered to the proposed budget or amendments to the budget.

“It is regrettable that we are putting up your council tax for the first time in two years,” said councillor Davies addressing constituents in the borough.

“The sad reality is that the money that we are levying onto residents in addition to their council tax is not enough.

“Even though every single penny of that increase will go to protecting the most vulnerable children, the most vulnerable adults and those in desperate need we still have to make cuts and reductions in services.

“It means that there will be less services for you to access, there will be things that you used to get for free from us that you will have to pay for.

“There will be things that you pay this council for that you might have to pay a little bit more towards.”

The council has a total of £59.09 in its reserves and balances, with a one-off usable balance of £21.7m to support its medium-term financial strategy in future years.

Councillor Davies warns that unless there are changes in local authority funding from central government then the council is heading towards bankruptcy.

“We’re having not just both our hands tied behind our backs, but we’ve also got our legs tied together too as we’re being pushed into the deep ocean of austerity and council bankruptcy,” he added.

“I will say it to residents in Telford and Wrekin very clearly that we will go bankrupt if things continue to operate as they are. This council will go bankrupt over the next few years.

“We will not be one of the first councils in this region to do so, we won’t be the second, we will be in the second half of councils in this country.

“For 14 years we’ve spoken about careful financial management, income generation and efficiencies. We’re at a point where the demand for children, adults and homelessness services is going through the roof, also the cost of providing those services is going through the roof.

“We need to fundamentally address and reform how we do local government in this country.”

Councillor Davies added that the King’s council tax bill for Buckingham Palace is £1,828 per year, which over 54 per cent of people across the country pay more than each year in council tax.

“That’s because council tax is not a fair system,” Councillor Davies added.

Councillor Bill Tomlinson, Liberal Democrat group leader, said that in the future if the council could not find savings then a council tax increase of 20 per cent would be needed each year to meet the rising demand.

Councillor Tomlinson added the Government’s extra £500 million investment into local authorities equated to £1.6m in Telford and Wrekin.

The council is also proposing spending a total of £420m in capital investments over the medium term, including more than £100m to expand council-owned housing initiatives, Nuplace and Telford & Wrekin Homes.

Councillor Tomlinson said that despite the council making returns from investments like Nuplace it ‘has to think about cutting back’.

Councillor Davies said that he took the comments around capital expenditure ‘seriously’.

However, he added: “The reality is if you don’t spend money on things like roads and pothole repairs you end up spending more money in the future because it costs more money to repair.”