Council leader Owen O’Donnell has revealed East Renfrewshire faces a £30m budget black hole over the next three years and warned cuts and increased charges are expected.
The Labour group boss has launched a budget briefing for 2023 to 2026 ahead of public engagement on the council’s future spendings plans.
His stark announcement comes after the council has already made savings of more than £80m since 2015/16. Cllr O’Donnell pinned the blame on the long-term underfunding of councils.
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He said the prospect of no extra money, in real terms, from the Scottish Government – the council’s single biggest funding source – and soaring inflation had created the huge shortfall.
A council tax rise, job cuts and higher fees for services will all be considered as East Renfrewshire tries to balance its budget.
Cllr O’Donnell said: “We already know that the budget process over the next three years is going to be extremely challenging and will require some very difficult decisions to be made.
“I am in no doubt that the major reason for this is the long-term structural underfunding of local authorities. To be clear, these are decisions we do not want to have to make but we are legally obliged to deliver a balanced budget.”
He has released the budget briefing, available on the council’s website, in an effort to be transparent with residents over the situation facing their local authority. Consultation events will be held before the council sets a budget in March next year.
The document explains where the council gets its funding from, what money is spent on and the cost pressures being faced. In the next few weeks, residents will be able to provide feedback on the services which are most important to them.
East Renfrewshire Council is facing rising inflation, at 10%, higher energy costs and pay awards as well as a growing population which is reliant on council services, the document highlights.
It is expected government grants will be at a flat cash level while council tax covers just 18% of the authority’s funding.
The council has also said a “significant amount” of its Scottish Government funding is “ring-fenced for national initiatives or policy priorities, such as education and social care.
It has depleted its financial reserves in previous years, committing to using £5.2m this year to avoid more cuts to services. This reduces the council’s reserves to £6.5m.
However, the council insists it is “committed to significant capital investment in the services which are most important to local people” and has highlighted how projects, such as school and leisure facilities, are funded through the capital budget rather than the revenue budget which pays for day-to-day costs.
Cllr O’Donnell said: “A radical approach to funding will be required, so it’s important residents consider this budget briefing before the engagement process, which will start in the next few weeks.
“The council has already made savings of more than £80m since 2015-16, so to bridge a gap of a further £30m is going to be very difficult. It is already expected that it will leave us with no option but to consider cutting services and jobs and increasing charges, including council tax.
“Once the public engagement process is completed, we will listen to the views put forward before setting the council’s budget on March 1 next year.”
Residents can read the budget briefing on the council's website.
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