A political row over major cuts to council funding has broken out after it emerged a North East local authority expects to end the financial year £15 million in the red.
The joint administration at Durham County Council has revealed there is likely to be a 'significant' budget overspend in April and is asking the Government for more money to plug the gap.
Council finance chief Richard Bell blames the rapid recent rise in inflation that has seen fuel prices rocket and the county’s gas and electricity bills shoot up from £7m a year to £21m.
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But opposition councillors point out the authority, which is run by Conservatives, Lib Dems and Independents, would be better placed to weather the economic storm if Tory austerity measures since 2010 has not taken almost quarter of a billion pounds from council coffers.
Councillors are due to debate the matter at County Hall on Wednesday morning.
Cllr Carl Marshall, leader of County Durham Labour, said: “Just over a year after taking over the county council, Cllr Bell bemoans lack of funding from his Conservative Government...the same Conservative Government that’s stripped almost quarter of a billion pounds from our county during 12 years in power.
“His party sneered as Labour spent a decade campaigning for a fair deal for Durham, while austerity choked off vital services, but now Cllr Bell talks of “significant challenges” caused by inflation, at a time when his party effectively shut down government to stage a lengthy leadership contest.
“The coalition refused to back Labour calls for increased Government funding, maintaining the UC uplift and to freeze council tax.
“And it could save around £1m a year in energy costs immediately by simply moving into the modern purpose-built HQ that’s stood empty for nine months while they tried to flog it.”
Cllr Rob Crute, deputy leader of County Durham Labour, said he had no faith that the joint administration or the current Tory Government could deliver the immediate and decisive action currently required in the circumstances.
He said: “Conservatives spent a generation tearing Britain apart and this Tory-led Coalition risks breaking County Durham in its first 18 months.
“Sadly, there’s no quick fix for the multitude of crises faced by County Durham families, but Coalition excuses around delays to Government consultation on a two-year funding settlement won’t wash.
“This Coalition must haul in Durham’s Tory MPs and, together, demand immediate Government action.”
The county’s Conservative MPs, Dehenna Davison, Richard Holden and Paul Howell, have been contacted for comment by the Northern Echo but have not responded.
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Labour’s North Durham MP Kevan Jones said: “If the council are in this position, they need to publish and explain some of their financially illiterate decisions such as the sale of the new purpose-built HQ building.
“Since 2010, I have campaigned to highlight the impact of Tory and Lib Dem austerity on local councils.
“It is difficult to stomach Conservative councillors complaining of a £15m overspend when successive Conservative Governments have taken over £240m per year away from Durham County Council.”
Labour’s Durham City MP Mary Kelly Foy said the overspend was ‘hugely concerning’.
She said: “More than a decade of Conservatives cuts to local government budgets have already drastically reduced the council’s ability to cope with additional pressures and this year, with the added impact of inflation, councils must have more support from national Government.
“Make no mistake, the services that councils provide are absolutely essential to huge numbers of people across the country, and I'm desperately worried about what this overspend will mean for those reliant on these frontline services, and for council staff who will be coming under increasing pressure to provide even more, for even less.
“This absolutely shows what the Conservatives think of County Durham.”
The council last week blamed its financial woes on the impact of Russia’s invasion of Ukraine, particularly around energy and fuel costs, alongside pay and price inflationary impacts on external contracts such as waste disposal services and home-to-school transport.
Conservative Councillor Richard Bell, deputy leader and cabinet member for finance, said: “Essentially, we face the same cost of living issues as the public, with our energy costs and rising prices of suppliers.
“Our combined gas and electric bills are soaring from £7m a year to £21m.
“Road repairs are impacted by the cost of oil and gas and are costing a lot more.
“We also have the impact of inflation on our staff wages.
“The council is making economies where it can, for example selling the Sands building to the university.
“We always strive to look for efficiency savings but these will not be enough to plug the gap.
“The council has a strong grip on its budget and a clear vision for the future, but we need more support from central Government, and I have already written to the new Prime Minister and Secretary of State.
“The new PM has acted swiftly to tackle energy costs for families and businesses, and a good start would be to offer councils help with their soaring bills.”
At a meeting in July, budget concerns were highlighted to the council’s cabinet, in a report which forecast that these pressures were contributing to a need to make £55 million savings over the next four years, with around £22 million of that forecast to fall into 2023/24.
A Department for Levelling Up, Housing and Communities spokesperson said:
“In recognition of the role they play, we have made available an additional £3.7 billion to councils this year to ensure they are able to deliver on local priorities and key public services.
“For Durham County Council, we have made available £503 million for this financial year to deliver services.
“We stand ready to speak to the council if they have concerns.”
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