Rochdale council tax freeze would open up £2m per year hole in finances, chiefs warned
01.08.2022 - 18:49
/ manchestereveningnews.co.uk
Freezing council tax in Rochdale next year would open up a £2m per year hole in the local authority’s finances, councillors have been warned. Finance bosses have drawn up preliminary budget proposals for the 2023/24 municipal year based on certain ‘assumptions’- including a 1.99pc rise in the general council rate and a further 1pc increase in the ringfenced adult social care precept.
With these taken into account, there is no ‘budget gap’ - the difference between income and expenditure - forecast for 2023/24, although this stands at £3.4m and £8.2m for 2024/25 and 2025/26 respectively. However, a report that went to the latest cabinet meeting makes clear that not hiking council tax up by 1.99pc would dent the authority’s finances by £2m each year - with no existing proposals to offset the deficit.
It reads: “If members decide not to increase council tax for the general increase of 1.99pc in 2023/24 then this would increase the gap by circa £2m per annum, for which there is currently no mitigating actions identified.” Although the assumptions included in the report are for planning purposes only, the impact of a 1pc change in the level of council tax increase is given as approximately £1m.
READ MORE : Rochdale's landmark 'Seven Sisters' flats could yet be saved as council plans to buy back demolition-threatened tower blocks
Councillor Carol Wardle, cabinet member for finance, told the meeting officers were ‘working very hard’ to keep council tax down but had been ‘hit with’ very difficult circumstances. The budget currently assumes a 4pc pay award in 2023/24 and also factors in the council’s commitment to local living wage rates - which could rise still further due to the current economic conditions.
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