Wirral Council’s finance watchdog said the council was not to blame for its £32m budget gap.
The Independent Assurance Panel, which was brought in one year ago to oversee the council’s finances, said it was “really pleased and reassured” about its financial position.
However it warned the council faced a “very difficult year next year" in 2024 as the local authority could see its reserves or backup funds drop to £3m.
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The comments were made at a meeting where councillors from all parties discussed proposals of up to £39m in cuts for the next financial year.
Those proposals include closing ten libraries, a leisure centre, two swimming pools, as well as three play centres. There are other cuts proposed as well as ways to generate income through council tax rises.
However it was the use of reserves to balance this year’s budget was a big concern for the panel.
Council officers have proposed to use £4m in reserves to balance the budget, which along with costs related to job losses, could bring reserves down to just £3m.
Carolyn Downs, who is Chair of the watchdog panel, told councillors: “The area of concern is budget as ever and I’m sure it’s the area of your concern as well. I want to start off by saying I don’t underestimate the difficulty of agreeing such large scale cuts in a council with no overall control and one which is going into all-out elections in May.”
“We accept that a really dillgent process has taken place and we accept you are not the architects of the budget gap you have got, it’s the same for all councils and this came late in the process, but there are four risks.”
Ms Downs said the level of reserves was below target and “the use of reserves will make the next year much more difficult just in case you don’t achieve your savings.”
She said while the use of reserves was lawful, Ms Downs added: “We would be very concerned and following the elections, we would anticipate you would begin work immediately on the medium term financial strategy."
Ms Downs said councillors would have to look to replace the reserves used and build them back up quickly.
Councillors have to set a balanced budget by the end of this financial year in April for 2023 to 2024 or risk the government possibly intervening in the finances and the functions of the council.
Other proposals put forward by the watchdog included beginning budget consultations earlier in the autumn and the council monitoring its budget on a monthly basis.
Councillors also reviewed plans to increase council tax on empty and second homes from 2024 onwards. While the recommendations passed unanimously, Cllr Jenny Johnson expressed concern about people who were renovating homes but taking longer than expected. The proposals would raise £1.9m in council tax for Wirral.
Cllr Jo Bird asked about what work was being done to analyse the pressures facing the council and scrutinise the proposals.
Brendan Arnold, Director of Finance, said work was continually being done “in order to make sure the proposals are as soundly based as they can be and taking account of the latest information.”
Paul Satoor, the council’s Chief Executive, said the Independent Panel was assured about the “robust process” the council was doing to scrutinise its budget and now the focus was to look at the proposals put forward
Council leader Janette Williamson added scrutinising of council figures and “officer time has been made available in abundance” in budget workshops where all parties were present.
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