Council outlines three-year budget strategy

Liverpool Town hall

Liverpool City Council has outlined budget proposals today, aimed at balancing its books in the face of £156m government cuts over the next three years.

The Council has developed a three year strategic programme to manage the reductions, providing a long term plan of how its services will look in the future. It follows Central Government funding cuts of £173m over the last three years, hitting the city with a 56% funding cut in real terms since 2011.

Mandatory services – those which the council is legally required to provide – have been required to make savings of around 25% and discretionary services have had to find savings of 50%.

Proposals include:

  •  £42m savings from the Adult Social Care budget over the next three years. This includes a proposal to significantly reduce the number of day centres provided by the council by 2015/16. A formal consultation will explore their future and investigate if we can work with the voluntary sector to provide these services in a different way.
  • £16m in savings from Children’s Services. This includes a consultation to significantly reduce the number of council-run Children’s Centres by 2015/16 and this will explore if community groups, the voluntary sector or partner organisations can work with us to provide some of these services.
  • A £500,000 reduction in spending on library services every year – in addition to a saving of £1m annual saving agreed last year – which will significantly reduce council-run services in some communities. This proposal will again be subject to a formal consultation and will also look at alternative ways of delivering services.
  • £4m savings in the council’s Lifestyle Centres over the next three years including the phased closure of Park Road and Everton Park centres, starting with their swimming facilities.
  • A review of school crossing patrols, with the aim of the council removing its funding by 2015/16, supported by investments in pelican crossings at key sites. We will work with schools to see if they can individually fund the patrols once the budget saving is made.

 VIDEO: Mayor of Liverpool talks about the budget proposals outlined today

Many of the savings will be found through a series of service reviews over the next three years – looking at streamlining the way teams operate and reducing staff numbers. Savings will also be found through renegotiating contracts and funding with suppliers and partners.

Mayor of Liverpool, Joe Anderson, said: “It is offensive to suggest we would play politics and deliberately cut services used by the people who elected me. If I could protect these services in any way I would, but our funding from Central Government has been cut by half.

“Unfortunately, we are not all in this together. Liverpool – along with other northern cities – has been hit hardest by the Government’s austerity measures. If we had received the average cut, we would have £80m more to spend in three years time.

“We are having to make some really tough decisions. We know that many of the proposals will result in some significant changes to services that people hold dear but we need to start making those decisions now as the money simply isn’t there to fund them in the future.”

“Every service will be impacted in some way by these savings and several hundred people employed by the council will face the prospect of losing their jobs.”

Mayor Anderson explained why he wants to set a long-term budget: “This year, I want the council to plan for the next three years to stop this annual cycle of cuts and to bring stability and some certainty to the people who use our services and to our staff.

“The proposals have been developed so that we can protect the most vulnerable adults and children in our communities. We are having to prioritise our priorities.

“The City Council will continue to deliver services but three years from now it will be operating in a very different way. This is out of necessity, because of the budget challenges we are facing. The council will be a very different organisation and will be able to offer less in the years to come.”

Because of the way council finance is regulated, “capital” resources can only be spent on buying assets or property and cannot be used for day to day services. Our schools are being built and refurbished in this way.

The budget shows the Council is starting to reap the rewards of some of its capital investment initiatives – with income of £700,000 per year coming into its funds from its “Invest to Earn” schemes at Finch Farm and the former Royal Insurance Building by 2016/17. This money will be used to fund services for the future.

Mayor Anderson added that there are still plans to grow and develop the city using any and all resources that are available to us.

He said: “Despite the serious funding challenges I believe Liverpool has continued to move forward through regeneration and property developments; the new cruise liner terminal; and 12 new and refurbished schools throughout the city.  We have also got 3,560 new homes which have been built in the city since 2012; a further 948 brought back into use and plans are in the pipeline for 4,116 new homes and a further 951 refurbishments.

“These sort of investments are vital so that we can ensure Liverpool has a sustainable, bright future and leaves a positive legacy for future generations instead of a legacy which is defined by the funding cuts we are currently facing.”

What happens next:

The budget proposals will be considered by Cabinet on February 14 and a final set of proposals will be considered by the Council on March 5.

The council is still considering its Council Tax position for the next year and, as the proposals develop, it will announce its plans for the year ahead.  Any rise, if one is put forward, would be below 1.99%. This is the threshold above which councils would currently need to seek a public referendum for an increase in the rate of Council Tax (Council Tax only contributes 9% to the Council’s budget).

The proposals show an overall saving £135.5m over the next three years and with a further £21.3m coming from reserves, ensuring we have a balanced budget.

No definitive figure is available yet on the number of job losses as a result of the savings. These will happen via a series of service reviews over the next three years and it is not yet possible to accurately calculate a final figure.