Wigan Council vows to protect services as £9m cuts loom

The local authority is also facing a cumulative shortfall of some £27m for 2023-24.

Friday, 9th July 2021, 4:45 am

The full scale of the financial challenges faced by local councils across the UK as they emerge from the pandemic can be revealed following a BBC investigation.

Wigan Council is in a better position than some town halls, with local authorities elsewhere in the country having to dip into general reserves and some even applying to the Government for exceptional financial support.

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Wigan Town Hall

Billions of pounds have been made available to councils to support them through the Covid-19 pandemic, but the Local Government Association (LGA) has said even this is not enough to stave off large cuts.

The figures, collected and analysed by the BBC Shared Data Unit, shows Wigan Council is planning to make £9m in savings in 2021-22.

This is equivalent to 3.9 per cent of the entire budget or around £27.38 per person.

However, the council has managed to avoid making further cuts to adult care in the latest round of trimmings.

Wigan Council leader Coun David Molyneux

And the council tax rise which has been agreed for 2021-22 is not the maximum amount which town halls are able to levy.

Budget cuts have become a familiar feature of local authority finances over the last decade, with 2020 marking the first one without savings in Wigan in a decade.

But bosses at the town hall say they have managed to reduce the loss of services and the impact on residents’ wallets compared to other local authorities in the region and across the country.

The BBC Shared Data Unit’s figures show Wigan’s £9m reduction is the eighth-smallest among North West councils.

Leader of Wigan Council, Coun David Molyneux said: “Local government is no stranger to local cuts and in the last decade, Wigan Council has had to make savings of £160m.

“Thanks to the commitment of our communities and employees and the success of The Deal, last year we were able to announce our first no-cuts budget in almost a decade.

“However, the impacts of the pandemic continue and like other local authorities across the country, our income has reduced and expenditure has increased.

“We do have another £9m worth of savings to make as a result but we’re confident that these savings can be made without impacting important services for our residents.

“Though we have previously frozen general council tax for the last seven years, we have made the difficult decision to increase it by 0.99 per cent this year to help cover our deficit. This is less than some other local authorities in the country and we will continue to have the lowest council tax rate in Greater Manchester.

“Ten years ago we began building the solid foundations of The Deal, which has meant we have been in a stronger position to deal with the effects of the pandemic.

“The relationship between council and community is key to ensuring local people are adequately supported in a sustainable way.

“We will continue focusing our efforts on those who need it most as we come out of the pandemic and have a longer-term recovery plan, which will be instrumental in helping us to build back fairer so nobody is left behind.”

Looking further ahead, the BBC Shared Data Unit figures say the council is looking at a cumulative shortfall of £27m in 2023-24.

This is a 10 per cent shortfall in the overall budget over two years.

Elsewhere, though, the BBC has found town halls staring at a financial abyss.

Almost two-thirds of local authorities in England and Wales are planning to raise council tax next year by the maximum amount of 4,99 per cent permitted without a referendum (three per cent is ring-fenced for adult social care).

Ten struggling councils in England are set to offset or borrow £290m after being given exceptional permission from the Ministry of Housing, Communities & Local Government (MHCLG) to try to remedy what it called their “unmanageable pressures”

UK local authorities, hit by falling income and increased costs, are set to make at least £1.7bn worth of savings in 2021-22 while also using more than £500m worth of reserves to balance the books.

Despite that, councils currently predict a £3bn shortfall in their budgets by 2023-24.

Town halls have also turned to investments to help balance the books, but this has been criticised amid concerns about exposure to risk.

All the town halls in Greater Manchester, including Wigan, will feel some impact from the loss of income from Manchester Airport during the Cvid-19 pandemic.

Costs associated with coronavirus, such as the procurement of Personal Protective Equipment (PE) for social workers and essential council staff, soared as cases rose over the past 16 months, while income from business rates and council tax were also hit.

Three tranches of Covid-related funding, totalling some £5.2bn, have been distributed since April 2020, along with other support measures.

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