Council plan to declare ‘cost-of-living emergency’

Herefordshire should declare a cost-of-living emergency and press for “sustainable funding” from central Government, according to the council’s financial chief.

In a proposal to be put to next Friday’s full council meeting, Coun Liz Harvey says: “The government’s mismanagement of the national economy and its deliberate and ideologically driven underfunding of local government means that to balance the 2023 budget this council needs to find savings in excess of £22 million – nearly 10 per cent of our service costs – just to survive.”

Earlier this year a Council of Europe report found the UK Government was still failing in its charter commitment to adequately fund local authorities, she points out.

Her proposal, which must be passed by councillors, is for the county to write to the Prime Minister, and to both Herefordshire MPs, calling for the Government to meet its charter commitment, raise funding to local government from next April by the current level of inflation of 11 per cent, and “undertake and implement the promised local government fair funding review”.

Declaring a cost-of-living emergency in Herefordshire would meanwhile commit the council to “recognise and respond” to the disproportionate effect this is having on the least well-off residents, and to “provide easy, swift and understandable access to advice and support” for those in need.

Her proposal is seconded by her Independents for Herefordshire colleague and head of transport Coun John Harrington.

Meanwhile Herefordshire’s likely overspend in the current financial year is now expected to hit £11.2 million, according the council’s top official.
Herefordshire Council chief executive Paul Walker says in a report for the same meeting that to address this, “I’ve asked everyone in the council to think about ways to make savings and also to consider opportunities to commercialise or maximise income generation”.

With the Government’s finance settlement with local authorities due to be announced on December 21, “we need to be prepared for not receiving any more support from central government”, Mr Walker added.

Leader of the Council David Hitchiner wrote to the Prime Minister and Chancellor last month urging “adequate, sustainable Government funding”, without which the council expects its budget gap to pass £22 million in the next financial year.

Though councils can now raise council tax by up to five per cent from next April, even this “ will not even cover normal inflationary costs, let alone those presently in play”, his letter said.

He has now told fellow councillors: “We will be engaging with residents and businesses throughout December on a range of options that could contribute towards balancing the budget for 2023/24.

“The views collated from these face-to-face and online events will inform the budget setting process and help us to align savings proposals with local priorities.”

A budget forecast presented to last week’s cabinet meeting showed that £7.2 million, or nearly two-thirds, of the council’s overspend this year is accounted for by its troubled children’s services department.

The meeting approved further spending of up to £6.5 million from its reserves to sustain the department’s “transformation”.

But Coun Harvey warned colleagues that “spiralling service costs in children’s services continue to present a risk to the overall financial stability of this council”, and that dipping into council reserves to meet this “is not a sustainable position”.