HAMPSHIRE County Council – as the local authority responsible for vital services such as adult social care, children’s services, schools and Hampshire’s road network – takes by far the largest share of residents’ council tax bill.
It takes around 64 per cent of it, to be precise.
And so when the county’s decision-making cabinet proposed to increase its share of the tax bill by the maximum-allowed 2.99 per cent on Tuesday last week, it leaves the average Band D taxpayer facing a £40 hike to their bills – before even factoring in rises by lower-tier councils, the police and fire service.
So with Hampshire’s full council expected to sign off its tax plans later today (Thursday), the Herald asks why is the county asking for so much from its residents?
Hampshire County Council is responsible for delivering £2.4 billion of important public services to Hampshire’s 1.4 million residents.
But as we explain elsewhere on this page, the county has suffered crippling cuts to its central government funding in recent years, while the cost of key services such as adult social care are sky-rocketing.
In addition, whereas up to last year the county council was able to levy an extra three per cent in council tax ring-fenced for adult social care – this year that levy has been cut to one per cent.
This has reduced the tax hike for Hampshire residents from 4.99 per cent in 2021/22 to 2.99 per cent in 2022/23. But it comes at a cost, county leader Cllr Keith Mans said ahead of last week’s cabinet meeting.
Cllr Mans said: “Every year, we have factored into our budget plans a funding shortfall of around £40 million – hence the £80m budget gap we have been planning for up to April 2023.
“To date, our strategy for dealing with these shortfalls has been to secure savings in two-year cycles, using our reserves carefully in the intervening years, to give us time to implement the necessary savings.
“However, since our most recent two-year savings round was agreed back in the autumn, major new budget pressures have emerged, pushing up our forecast gross budget deficit for 2022/23 from £40m to £97m.
“This is because of pressures including the financial impact of Covid, but most notably, the growth in the cost of adult social care, driven by market prices now around 18 per cent higher than expected.
“Agency costs have also risen significantly to manage higher numbers of referrals in children’s social care, and inflation is now at its highest level since 2011, which is impacting on a range of costs, particularly our energy budgets.
“Our strong financial position means prudent use of our reserves can help buy us some time to not only consider the best approach to address the issue, but also for discussions and lobbying to take place with government on the very serious financial position that we find ourselves in.
“But beyond that, we need significant extra government funding to meet future shortfalls from the huge rises in adult social care costs – all coming on top of the £640m of spending reductions we will have already made to 2023/24.
“Without a long-term sustainable funding solution to the growth in social care costs, the county council is not financially sustainable in the longer term and this has never been truer for our current outlook.”
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