Administration Recommends “Perilous” Budget To Full Council

Having heard last week that Government will not permit Cheshire East to raise its Council Tax by 9.99%, the Council is still expected to increase council tax by 4.99% and will also need to raise approximately £28 million of “exceptional financial support” (through borrowing) in order to balance its books for 2026/27. This type of borrowing also needs Government permission.

At the council's corporate policy committee on 12th February, a raft of recommendations were recommended to be considered by full council at the February Budget Council Meeting. 

The 4.99% rise in council tax, will see the tax rise on Band D properties, from £1,882.04 to £1,975.95 from April.

Conservative group leader Stewart Gardiner (Knutsford) referred to the 'perilous' budget situation.

"Yet again, we are having to borrow money to balance our books.” He said Cheshire East had not taken up the chance to transfer some assets and services to town and parish councils.

He was also critical of the council for not pressing ahead with proposals which had been agreed in the past.

"We sit on a significant asset base in terms of land and buildings," said Cllr Gardiner.

"We are in a planning period where the government is saying, 'build, baby, build', or words to that effect, and I have yet to see one of our sites presented to a planning board seeking outline planning permission for residential development. "Yet I know… there was an agreement that we should dispose of a set of car parks in the middle of Macclesfield. "If we do not take action now, we will be here again next year."

He added: "So, it's a plea. Please, please, please, can we look at doing more to increase our income, as well as looking at better ways and smarter ways of spending the money that we spend to deliver services?"

Deputy council leader Michael Gorman (Wilmslow, Ind) agreed that Cheshire East 'needed to get its act together' in respect of asset transfers to parish councils but claimed that Cheshire East was facing problems other councils weren't.

He cited that Cheshire East had the pressure of the LGA Peer Review (Local Government Association), Ofsted and the Best Value Notice from MHCLG (Ministry of Housing, Communities and Local Government).

He then referred to the cash missed out on when the Conservatives ran Cheshire East and froze council tax between 2011/12 and 2015/16; "Income opportunities were lost, and the current tax base just isn't comparable to our neighbouring authorities," said Cllr Gorman. "Over time that's cost us £22.6 million, and we've just got to face this." "And we've also got to face a real surge in demand-led services, particularly in social care…"We've got an over-75 population that increased by 40 per cent between 2011 and 2023."

He said there were some real anomalies in the government's fair funding formula, 'and we are not getting a fair deal here'.

However, on further examination, Cllr Gorman’s assertions fail to carry any weight.

ALL Local Authorities with responsibilities for Children and Families are subject to Ofsted and Care Quality Commission Inspections and all are experiencing rising demand and complexity of need. (CEC is only special in this regard because it failed inspection standards!).

The LGA Peer Review was commissioned as a result of the already failing state of the Council under the leadership of the Labour/Independent Coalition administration, and the Best Value Notice is a direct result of this administrations failure to manage their fiscal responsibilities adequately over the 6 year period of their leadership.

(The Conservative Administration in 2019 left a balanced budget and a DSG (Higher Needs Special Needs) Budget) that was £1.6m in surplus).

Whilst it is agreed that the Government’s Fairer Funding formula has penalised more rural Councils, It must be noted that despite Cllr Gorman’s claims, the core spending power of CEC has risen by over 60% since 2011 - a third higher than inflation over the same period!

So too, whilst Council Tax freezes under the Tories did reduce potential base budget rises, CEC, alongside other Local Authorities received commensurate grant funding from Government as recompense for freezing Council Taxes

The Conservatives, who said they will be putting forward an alternative budget, stated that as it was not yet certain if Government would permit CEC to raise Exceptional Financial Support through yet more borrowing, they could not support the recommendations at Thursday's meeting.

The final decision on the council tax rate and on the budget (Mid-Term Financial Strategy), will be made by full council at its meeting at Tatton Park at 11am on Wednesday, February 25.