On Thursday 19 November, Cabinet members are set to discuss a proposed budget strategy to ensure the council delivers a balanced budget in the next financial year (April 2021 – March 2022).
The Council was already under financial pressure before the COVID-19 pandemic. The forecast budget gap for 2021-22 is approximately £840k.
The money that is used to fund public services is made up of Council Tax receipts, income generation including from fees and charges, retained Business Rates and any Government funding.
The report proposes that £400k is achieved through an increase of fees and charges of 2% and an increase of Council Tax of 2%.
Permanent savings are required to address the deficit and deliver a balanced budget. The intention is for this to be achieved mainly through internal management of budgets. For example identifying areas of historic underspend and covering any new growth pressures from within existing service budgets. The replenishment of reserves is also proposed to be delayed until 2022-23 to help meet the financial gap.
Leader Cllr Rick Everitt said: “There is unprecedented uncertainty around the budget-setting process this year due to COVID-19 and we expect the position to evolve before council agrees the final position in February. However, we have to plan based on what we know and protecting the services that matter most to local people will be a key part of our consideration when we meet to review the proposed budget strategy next week.
“As a result of sound financial management, we’re fortunate that we’re not seeing a shortfall next year on the same scale as the millions identified by some authorities. That said, for Thanet this is still a significant gap. It means some difficult choices must be made, and I am also conscious of how well our staff at all levels have responded to the COVID-19 situation.
“We’ve seen a substantial impact on our budget this year as a result of COVID-19 – our focus has rightly been on the immediate coordinated response to support our residents and local businesses. This additional pressure along with the increasing challenges we see each year as funding from the Government dwindles further still, means it is a sad but inevitable fact that we will have to make some difficult decisions.
“Given the huge continued uncertainty regarding COVID-19, our forthcoming exit from the EU and Government policy regarding local government, the Medium Term Financial Strategy is being pushed back to later in the budget process. At this stage there is too much uncertainty to develop a meaningful four year budget strategy.”
The Budget Strategy forms part of the council’s annual budget setting process for the financial year ahead. It sets out the broader approach and principles proposed to meet the identified gap. A separate Budget Report will be published in January in which the specific details of the savings will be provided.
Thanet District Council receives just 13p in every £1 of Council Tax. The remainder goes to: Kent County Council, Kent Police and Crime Commissioner, Kent Fire and Rescue Service and Town/Parish Councils.