Lancashire County Council budget 2020: more money for roads and buses - but council tax up by four percent

Extra cash is set to be invested in Lancashire’s roads and buses after Lancashire County Council agreed its budget for the year ahead.

There will be an additional £5m in capital spending on highway repairs, while bus services will get a £1.5m boost this year and £3m in each of the next three years.

County councillors debated the budget for over three hours

County councillors debated the budget for over three hours

The surprise spending promises were made by the ruling Conservative group in an adjustment to their own budget proposal.

They also include more money to help reduce the caseloads of social workers looking after children with special needs and disabilities, as well as funding for museums.

But residents will see a jump in their council tax bills, with County Hall increasing its share of the levy by 3.99 percent from April, two percent of which is ringfenced for social care.

The hike - the maximum increase permitted by government without it being put to a referendum - equates to an extra £53 per year on a band D property in the county. Council leader Geoff Driver said he was putting up council tax "reluctantly" to keep the authority financially viable. It will bring in an extra £20m a year.

The opposition parties also put forward their own spending suggestions. Labour and the Liberal Democrats shared a focus on flooding, highways, reversing cuts to household waste recycling centres and supporting Lancashire’s financially-threatened maintained nursery schools - but they still turned on each other over the specifics of their proposals.

The authority is currently working with a team of third party consultants on a plan to overhaul the way it operates in order to plug a £38m funding gap which is forecast by 2023.

That meant this budget was notable for the absence of the significant savings which have been demanded in recent years.

But it did not prevent the debate drifting into the financial difficulties which have dogged the authority for almost a decade.

County Cllr Driver paid tribute to the hard work of staff and declared that his administration had turned Lancashire County Council from “a basket case to a showcase” since being re-elected in 2017.

“One decision stands out - to replace the ridiculous and misguided senior management structure that the previous Labour administration introduced, which led directly to many of the problems the council faced and continues to face.

“Lancashire County Council was like a rudderless ship going nowhere - there were no sustainable plan to eliminate a massive deficit and reserves were being exhausted at an alarming rate.

“I’m the first to say the county council is not a business, but we must be business-like in the way we provide services,” County Cllr Driver added.

However, the Labour opposition stressed the impact of the £600m cut from the authority’s finances by the coalition and Conservative governments.

“We dealt with £400m of that and now you’re whinging and whining about your government leaving you £200m to deal with,” said deputy Labour group leader John Fillis.

“We heard about financial history [in County Cllr Driver’s speech], but what wasn’t identified was the zero percent increase in council tax [by the ruling Conservative group] in 2013 - an election bribe which has cost this council £55m.

"Clearly, people are paying more in their council tax than they did four years ago - so people are paying more for less under this Conservative administration," County Cllr Fillis said.

Liberal Democrat group leader David Whipp also honed in on what he described as “unsustainable council tax increases”.

“They are being forced on all councils by central government as a way of trying to plug the gap between the money necessary for, in particular, social care services and the money that is available.

“Lancashire has amongst the highest band D council tax of any local authority in the country - but if you look at the amount collected per household, we have amongst the lowest, because of the vast preponderance of band A properties

“The Conservatives are celebrating their balanced budget. But [were it not] for a treasury management [investment] windfall of £20m, the in-year position would be an overspend of £11m.”

Meanwhile, the county’s lone Green Party representative, Gina Dowding, accused the ruling Tory group of failing to show “leadership” on climate change.

“Things are going to get drastically worse if we don’t start to drastically reduce our carbon emissions as a county.

“Business as usual simply isn’t an option. I’d have thought the Conservatives above everyone would have understood the principle of invest to save - and we need to start investing now in reducing our carbon emissions, because the cost of not doing so is going to be so enormous further down the line,” County Cllr Dowding warned.

Budget papers revealed that the finances of the county council will not need to be supported by reserves this year - and that the authority’s main reserves are forecast to stand at £100m by 2023/24. Previous estimates have indicated that the cash safety net would have been used up before the end of each rolling four-year spending period.

However, members heard of the “high risk” posed by the need to deliver £58m of previously identified savings within the next three years.

Some individual departments are also continuing to show financial pressure, with adult services forecast to overspend by £10.3m this year and children's services by £3.4m. If demand for social care were to increase by just one percent in the coming year, it would cost the county council another £6m.

The meeting was told of the unprecedented uncertainty facing the authority over its funding beyond this year, as it awaits the outcome of the government's fair funding review which has been postponed until 2021. As yet unknown changes to the way business rates are distributed could also have an effect on County Hall's books.

Late last year, finance officers drew up a range of possible scenarios for the county council's budgetary position by 2023/24, ranging from a £6m surplus to an £86m deficit. They concluded that the most likely outcome was a shortfall of £28m - but that estimate has already increased to £38m.

CONSERVATIVE BUDGET ADJUSTMENT

The plans voted through by members include extra investment in:

Highways - £5m (capital spending)

Buses - £1.5m (2020/21); £3m (2021/22-2023/24)

Road markings and signs - £1m

Museums £939,000

Inclusion service - £539,000

Library book fund - £500,000

Public rights of way grant to parish councils - £103,000

Veterans services - £65,000

*all figures for 2020/21 unless otherwise stated

Along with other proposals not listed above the plans will add £5.1m to the council's funding gap by 2023/24, which will have to be filled by savings or use of reserves. The capital spending on highways will be funded by borrowing.

LABOUR BUDGET AMENDMENT

The opposition proposals, which were defeated, included extra investment/reinvestment in:

Residential street 'greening' (to improve the appearance of those streets with a 'grid pattern' layout) - £5m

Flood prevention - £4m

Repairing roads where the surface has been worn down to the cobbles - £1m

Nursery schools contingency fund - £1m

Lancashire breaktime (respite service for families with children with special needs) - £1m

Reversing cuts to waste recycling centre opening hours - £734,000

Welfare rights service - £380,000

Gully emptying - £283,000

Residential parking permit schemes - £250,000 (capital spending)

Scrap plans for new pay and display schemes in town centres - £100,000

*all figures for 2020/21 unless otherwise stated

Along with other proposals not listed above the plans would have added £13.7m to the council's funding gap by 2023/24, which would have had to be filled by savings or use of reserves. The capital spending on residential parking permit schemes would have been funded by borrowing.

LIBERAL DEMOCRAT BUDGET AMENDMENT

The Lib Dem proposals, which were defeated, included extra investment/reinvestment in:

Highways - £15m (capital spending)

Drainage maintenance - £1.2m (capital spending)

Nursery schools contingency fund - £1m

Reversing cuts to waste recycling centre opening hours - £734,000

Reductions in street light dimming - £500,000

Reactive maintenance to highway drainage - £318,000

*all figures for 2020/21 unless otherwise stated

Along with other proposals not listed above the plans would have been funded by savings elsewhere which also reduced the budget gap by 2023/24, although officers assessed that their impact on other services would have to be "closely monitored". The capital spending on highways and drainage would have been funded by borrowing.

GREEN PARTY BUDGET AMENDMENT

The Green Party proposals, which were defeated, included extra investment/reinvestment in:

Home improvement service - £880,000

Maintained nursery schools - £289,000

Climate action co-ordinator - £50,000

*all figures for 2020/21 unless otherwise stated

Along with other proposals not listed above the plans would have added £1.2m to the council's funding gap by 2023/24, which would have had to be filled by savings or use of reserves.