Wigan Council bosses explain ‘financial storm’ to come in 2023

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Town hall bosses say “it is pouring it down” and they will dip into “rainy day” funds ahead of what could be a tough 2023.

As some councils face bankruptcy, leader Coun David Molyneux says Wigan Council is “nowhere near” that – but may have to tighten its belt.

This comes after Chancellor Jeremy Hunt’s statement setting out cuts of £35 billion and tax rises of £20 billion, to plug a gap of £55 billion in public finances.

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Coun David MolyneuxCoun David Molyneux
Coun David Molyneux

“It is absolutely throwing it down,” Coun Molyneux said.

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“The storm that is heading over this afternoon is nothing compared to the storm coming in local government finance. Obviously we have always stated that our reserves are there for a rainy day. But now it is a rainy day.

“So we will have to dip into our reserves. Some authorities across the country don’t have this.”

One of the biggest pressures is adult and children’s social care – set to cost an additional £7.8m and £17m next year respectively.

Schools finances are "generally healthy” but there are some exceptions.

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Despite this, the extra £2.3bn per year for schools – plus the £2.8bn extra next year and £4.7bn the year after for social care – “will largely be subbed by council tax rises” (£1.8 bn), explained Paul McKevitt, deputy chief executive and chief finance officer.

He said even costs to run the council had gone up by 15 per cent and there is a budget gap of £37.1m next year.

Potential council tax rises of five per cent "will have to be revisited” – especially when it comes to social care services.

“We are proud of the fact we have the lowest council tax of any metropolitan borough in the country, not just GM,” Coun Molyneux said.

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“We have acted over the last 12 years to make sure that we’ve always got our residents in mind when setting council tax.

“For six years we have not increased our council tax. I think now we are in a position where we have got to do what’s right, not just for the council but the people out there.

“That will become more clear as to what that is in the next statement around December 24. I am hopeful we will be getting our ducks in a row for next year.”