Plymouth budget

Help us balance Plymouth’s budget

 

We want to hear your views and ideas as we make decisions to set a balanced budget for the 2020/21.

We face big challenges in doing this as our funding continues to reduce each year while demand for services is rising.

Our challenge

Our budget for delivering services such as emptying bins, cutting the grass, maintaining roads and pavements and looking after the elderly and children comes from Government grants, Council Tax and income such as fees and charges.

The problem is that the main Government grant – the revenue support grant – has reduced from £123.8 million in 2010/11 to only £9.7 million in 2020/21.

Rising demand

At the same time, our costs are rising.

The resources required to keep vulnerable children safe is a significant cost for the Council. There are ongoing budget pressures due to the rising cost of care due to the high level of support needed to some keep young people safe, such as specialist residential care placements with high levels of staffing.

We also have an ageing population and nationally the cost of providing health and wellbeing services is rising as more people need care and the type of support they need becomes more complex.

We also have a duty to pay those providing these vital care services the National Living Wage, which increases our costs.

All this has a huge impact as more than 65 per cent of our total revenue budget needs to be spent on care services for children and adults. 

In recognition of the spending pressures in these areas we are planning to increase our base funding for children’s social care by £5 million and adult social care by £4 million in 2020/21.

Some of our other services rely on specific Government funding allocations, which continue to shrink.

Our public health service works to improve the health of Plymouth residents, and in particular, to tackle the large differences in health that we see between different areas of the city. Plymouth is currently receiving 24 per cent below the recommended funding level based on the needs of its population.

 

How we are meeting these challenges

In Plymouth we have been working hard to deal with the challenge of year on year of reducing funding.

We have delivered up to £90 million of savings in recent years.

Our ongoing work to run services as efficiently as possible and manage with less includes joining up with partners such as the NHS and creating shared services. We are also taking a more commercial approach to generate income.

A vital part of this work is investing in Plymouth

This is because we remain ambitious for Plymouth despite the funding cuts were are facing. We want Plymouth to grow and the Plymouth and South West Devon Joint Local Plan sets out that we will build 26,700 new homes across the whole Local Plan area by 2034 to meet these needs.

Increasing the number of homes raises income through Council Tax, enabling us to provide the services and infrastructure that families in Plymouth need. Over the last year we supported the delivery of 682 new homes.

We also have ambitious plans to create jobs. We are investing – through what is known as our capital budget – in property and assets that:

  • Provide a long-term revenue income to support local services
  • Stimulate economic and employment growth and regeneration in the city

For example, we have bought business and retail parks and the freehold of other business and retail properties.

We pay for these investments through our capital programme which is funded through low-interest loans, money from developments and grants for specific projects such as road schemes.

We have also been very successful in securing millions of pounds of capital funding from the Government to invest in major infrastructure projects such as the Forder Valley Link Road. These schemes provide the extra capacity needed to support the growth of the city while keeping the city moving.

We are also investing in our Mayflower 400 commemorations this year, which will support jobs in Plymouth and bring in income.

 

Planning the 2020/21 budget

We plan to set a revenue budget of £188.7 million to deliver hundreds of services to Plymouth residents next year.

This includes the additional £5 million needed to care for and protect vulnerable children and a further £4 million to help meet the demand for adult social care.

We are also investing £250,000 to help tackle the climate emergency, which is additional to the investment from our separate capital programme in electric vehicles to reduce our carbon footprint.

Cabinet have been faced with a £16.7m gap in funding, which has been mostly found from reducing spending, identifying additional income and from grant funding changes.

We have continued to make savings and have only accepted additional costs in the budget in exceptional circumstances, with the assumption that departments absorb increased cost of service demand and inflation through proactive management action and efficiencies.

We have identified £12.3 million so far and currently have a funding gap of £4.3 million before we consider Council Tax levels.

Members and officers will be working closely to narrow the existing budget gap million before the budget is set by the full council on 24 February. This will include options to explore further opportunities for income generation and service efficiencies to reduce the Council’s cost base.

 

Council Tax

The Council Tax we collect provides a proportion of the income we need to provide local services. We understand the strains on household finances in Plymouth and do not want to raise Council Tax more than necessary. Plymouth residents continue to pay one of the lowest average Council Tax rates in the region and we want to keep it that way.

Each one per cent increase in Council Tax can raised around £1 million for local services so it is only part of the solution to addressing the financial pressures facing the Council.

 

What do you think?

What do you think we should be doing to balance the books? We'd like to hear your views and ideas.

Give your views