Council Tax Frozen For Another Year

10th February 2010

Council Tax frozen as Council sets £607 million budget for 2010-11

The Highland Council will be asked to confirm savings of £12.1 million when they meet on Thursday 11 February to set a revenue budget of £607.2 million for 2010-11 and confirm a freeze on the Council Tax. The budget is based on the Council Tax at Band D remaining at £1,163 for the fourth successive year.

To meet the costs of providing a wide range of essential services, the Council will receive £500.2 million of revenue support from the Scottish Government, including a grant of £3.235 million to support the freeze on the Council Tax. The balance of spending is funded mainly by £106.8 million of income from Council Tax payments.

As well as finding savings of £12.1 million in 2010-11, the Council has identified further savings of £11 million in 2011-12 and 2012-13. It is estimated that this will still leave a budget gap of £36 million in 2011-12 and 2012-13.

At its meeting on Thursday 11th February 2010, the Council will focus on savings in its three biggest spending Services, namely Education Culture and Sport, Social Work and Transport Environmental and Community Services, as well as the Joint Committee for Children and Young People. Savings in Chief Executive's, Finance, Housing and Property and Planning and Development were agreed at the Council's meeting in December.

Council Budget Leader Councillor David Alston said the Council is to consult widely before agreeing budgets for these two years in the autumn, by which time the outcome of the UK Spending Review, and implications on public spending will be clearer.

A Citizens' Panel is to be established to act as a sounding board on a range of Council issues, including the budget. Soon the Council will be writing to Highland households to identify Council Tax payers who are prepared to be consulted on Council issues. It is hoped the panel will comprise more than 2,000 people.

Councillor David Alston, Budget Leader, described the budget challenges facing the Council as "extreme" and said the public had a significant role to play in future decisions.

He said: "We face significant financial challenges over the next three years, finding savings which add up to £60 millions. We estimate that the next Council, elected in 2012, will have to provide services with 12% less resource in real terms than at present. We want to safeguard future services by planning ahead and by listening to the public's views about their priorities. Balancing the books is essential if the Council is to remain able to provide the services on which our communities depend."

In relation to 2010/11, he said the Council had experienced a lower level of grant support than had been originally notified in December 2007, due primarily to the effect of the £500m reduction in the Scottish budget as a consequence of the November 2008 UK Pre-Budget Report.

Initial indications in summer 2009 were that over the 3 year period - 2010/11 to 2012/13 - savings of £60 million would be required to balance the budget. On that basis, Services were advised to prepare saving proposals of 5%, 6% and 6% of their budget over those years, to provide an estimated £80 million of saving proposals to give the Council choice and flexibility in considering its budget.

In setting the budget, he said emphasis was placed on protecting front line services with greater corporate savings being identified..

Better news was an expected reduction in electricity unit rates from current contract, giving a £2,352,000 net reduction across all energy budgets.