Care cuts and bin collection charges - Liverpool City Council have ‘eye-watering’ £34m financial hole to plug

Liverpool City Council has announced a raft of proposed measures to try and fill a £34 million gap in its finances.

Increased parking fees, bin collection charges, a reduction in care packages and Council Tax increases are all included in their new budget proposal report.

The local authority has seen its funding reduced by around 65 per cent since 2010, and needs to make additional savings for 2022/23.

The budget report also detailed areas of huge overspend during the pandemic such as COVID-19 related health care and children’s social care.

Plans for a Council Tax rise of 1.99%, plus proposals totalling £18.7 million have so far been drawn up. These include a mix of reductions in spending and generating additional income.

What proposals are under consideration?

• Council Tax rise of 1.99%
• A review of the controlled parking zones and services – to generate £1.6 million
• A £40 annual charge for green bin collections – to raise £1.7 million
• Charging private landlords and social housing providers for pest control – to bring in £200k
• Managing demand for school transport – to save £500k
• Reviewing high cost packages of care to ensure individual needs are being met and funded in the correct way – to save £1.9 million
• Increasing revenue from filming, cruise liners and events – to bring in £270k
• Management restructure – to save £200k
• Review of subsidy given to several externally run libraries – to save £280k

Are these changes definite?

Not yet. The council’s report on the proposed changes will be presented to Cabinet on Friday, 5 November, when the consultation on the next budget begins.

The report was also composed prior to Chancellor Rishi Sunak’s UK budget announcement on Wednesday.

He said in his speech that Council Tax could only be raised by local authorities to a maximum of 3%, with 1% of this going to social care.

These changes may mean the council already has to review some of its proposals.

If the report is approved, a 10 week consultation on the budget proposals will follow from Saturday, 6 November, giving people the chance to have their say over the plans.

Why do the council need to make savings?

The local authority points to over a decade of cuts in funding and say their budget is now £465 million a year less than it was in 2010.

Council Tax only raises 40% of the total needed, with the remainder coming from Government grants and business rates.

Metro Mayor Steve Rotheram hinted that something might be in the pipeline when he reacted Chancellor Sunaks’s new financial measures by saying: “This budget didn’t do anything to reassure families or local authorities hit by austerity.”

Impact of COVID-19 on finances

The Liverpool City Council budget report also highlights areas of huge overspending during the pandemic which “had a very significant financial impact” on the previous budget.

The local authority’s Adults Services and Health Directorate forecasts an overall year-end budget overspend of £7.724 million, which is in part due to the legacy costs of COVID-19 hospital discharges and the funding for subsequent care.

The Childrens and Young Peoples Directorate noted an overspend of £9.762 million, of which £7.991 million was in children’s social care.

The report noted that there had been an increase in ‘Looked-after Children’ referrals and in care entries due to neglect, domestic violence and alcohol and substance abuse linked in part to the wider impacts of the pandemic and lockdown.

Homelessness costs for accommodation totalled £4.77 million - a significant increase on the previous years.

This was due largely to the early response to the pandemic and the need to accommodate all rough sleepers and for families living in unsuitable accommodation under the Governments ‘Everyone In’ initiative.

Reaction from the Mayor of Liverpool

Mayor Joanne Anderson, said: “We have to save an eye-watering amount of money in order to legally balance our budget.

“We will examine every decision through our triple-lock prism of its impact on people, the planet and improving equality.

“We are committed to doing what we can to protect the most vulnerable and those struggling to make ends meet, and they are among our highest priorities.

“We won’t shirk away from finding sustainable solutions to long-term problems and the double whammy of ‘austerity’ and COVID-19.”