The budget proposals for 2020-2021 were approved by Cabinet Members and Full Council on Thursday 27 February 2020.
Despite a challenging financial climate and extensive government cuts, we’ve achieved a balanced budget for 2020-2021 through strong service and financial planning and efficiency processes.
Cllr Sir Stephen Houghton CBE, leader of the council, said: "I'm pleased to be able to propose a balanced budget for 2020-2021. For the last ten years, I've had to propose budgets which have focused on constant reductions due to austerity. This year it's a different kind of budget; concentrating on putting money back into the borough and our communities.”
"Our forward planning and good financial housekeeping have meant we can explore a number of one-off and ongoing investments for the upcoming financial year.”
"As a council, we're still faced with considerable financial uncertainty. We will remain vigilant, prepare for every financial scenario and manage our resources with a long-term future in mind."
Since 2010, we’ve made budgeted savings of an estimated £115 million.
We're not sure what the Government's future financial settlements will be, we still need to be in a position to make sure we can fund services going forward. This is why we're still proposing £7.4 million of efficiencies across the council, looking at changing the way we deliver our services to meet our residents’ needs.
Our current financial position might make it sound like it's been an easy process for us; it hasn't. Government funding reductions over the last ten years have forced us to make tough and unpopular decisions, as well as changing the way we deliver our services.
These cuts combined with a growing demand on our services and rising inflation means the gap between the funding we receive and the cost of the services we deliver continues to widen. Despite our efforts to bridge this gap, the council’s component of council tax will increase by 3.9 per cent (this does not include the contribution paid to the police and fire services or parish council contributions). The rise includes a 1.9 per cent increase to help fund general services - such as bin collections, roads and our Area Council’s - and a 2 per cent increase ring-fenced for adult social care and the Excellence in Care programme.
We haven’t taken this decision lightly and we’ve explored several options to keep council tax levels as low as possible. It’s important to emphasise that the funding we raise from council tax helps us to provide residents with vital services but only contributes to 19% of the overall funding we need to deliver these services across the borough.
Where does the council’s money come from?
Every year, we set a budget for the coming financial year (April to March). The budget sets out how we’ll spend our money to provide a range of services to meet the needs of our residents - including schools, social care, planning, public health, bin collections and road maintenance.
We call this the ‘revenue budget’ and it’s used to pay for the day-to-day running costs of delivering our services - such as staffing, maintaining public buildings and general service running costs.
The ‘net’ revenue budget available to spend on services for 2020-21 is £173 million. This is funded from a combination of central (core) government grants, business rates and council tax. This is the amount of money available after contributions from our other income have been accounted for - such as council house rents, grant income received for specific purposes, client contributions and fees and charges.
Our forward planning and good financial housekeeping have meant we can explore a number of one-off and ongoing investments for the upcoming financial year.
Has the 2020-21 budget been cut?
Although we strive to be a self-sustainable organisation, it still remains the case that we rely heavily on government funding and grants.
Since 2010, we’ve suffered extensive reductions from the government year-on-year with our revenue support grant (RSG) reducing to date by £95 Million – this is the equivalent of a 58% reduction in cash. However, because of the increasing cost of providing our services due to inflation and an increase in demand, we’ve had to make over £114 million in budget savings/cuts in services including £7M million in savings to balance our budget.
Unfortunately, the outlook for local government funding beyond 2021 is even more uncertain as we await the outcome of several government reviews that will have a significant impact on the funding we receive and how we’ll receive it. Combined with this is the impact that the EU exit proposals may have on public finances and the way in which the government allocate funding.
Does the 2020-21 budget balance?
Yes, the budget does balance. Providing we deliver our efficiency plans, manage demand for services effectively, receive government funding as expected and remain flexible and vigilant, we’re in a relatively stable financial position for 2020-21.
However, like we have mentioned, there is a great deal of financial uncertainty over the next few years and beyond. We’re preparing as well as we can for these uncertainties and the different scenarios we may face. We’ve updated our three year financial plan taking us up to 2022-23 which presents a balanced budget for the next two years. However, the position beyond 2020–21 is very uncertain and is constantly changing. Our forecasts are based on many assumptions, so it is critical that we remain vigilant, flexible and be prepared for all eventualities.
Beyond the next financial year, we’re currently estimating a relatively modest £12.5 million shortfall that will need to be met from budget savings. However, this remains extremely uncertain until the government confirms what funding will be available. Regardless of uncertainty, we’re already putting plans in place to meet this shortfall.
How will the proposed 2020-21 budget be spent?
The budget is allocated to help us make Barnsley an even better place to live, work and visit. All decisions on how to spend and allocate the budget are made with our residents in mind - making sure the work we do makes a real difference to you and your family, whilst also driving towards a sustainable future council.
The budget will be spent across a number of front line services. Further information can be found in the Your Guide to Council Tax and Budget
In addition the council is spending over £19M new investment on six focus areas. Key parts of the proposals are broken down into revenue spend (e.g. day-to-day spending) and capital spend (e.g purchase or improvement of fixed assets). A summary list of investment proposals is provided below with a full list available on the council's website:
Revenue spending (e.g. day-to-day spending)
- Supporting wellbeing and managing demand for statutory services - £3,139,000
- Improving the efficiency of the council with invest to save - £875,000
- Positive environmental impact and Zero Carbon objectives - £740,000
- Supporting the growth of the digital sector in Barnsley - £400,000
- Supporting the renaissance of the town centre and Principal Towns - £1,255,250
- Making a visible difference in communities - £1,086,000
Capital spending (e.g. spending on fixed assets like roads or buildings)
- Supporting wellbeing and managing demand for statutory services - £2,106,000
- Improving the efficiency of the council with invest to save - £250,000
- Supporting the renaissance of the town centre and Principal Towns - £4,700,000
- Making a visible difference in communities - £3,370,000
Find out more about the key areas of investment on page 197 of the Full Council papers for Thursday 27 February 2020.
Where does money for the capital programme come from?
Capital funds are separate to our revenue budget and cannot be used to fund running costs. Capital funding can come from a number of sources, including:
- capital receipts from selling off assets e.g. land
- specific grants to pay for specific schemes or initiatives
- borrowing e.g. a loan
- match funding/contribution from external parties
- money set aside from reserves (underspends) from the revenue budget
We’ll continue to roll out our capital investment programme during 2020-21 – including further investment in the town centre redevelopment, new housing developments providing more affordable homes, various highway improvement schemes and further school expansions to accommodate our growing population.
We’ll continue our drive to invest in the borough's future with a proposed £10.4M of new capital investment to be spent over the next three years through the ongoing roll-out of our capital investment programme.
Is my council tax going to increase?
Despite efforts to bridge the gap in funding, due to the year-on-year cuts from central government, growing demand on our services and inflation, the council’s component of your overall council tax bill will increase by 3.9% for 2020-21. This includes:
1.9% increase to help fund general services
2% government increase ring-fenced for adult social care and the Excellence in Care programme
We’d like to reassure our residents that this decision has not been taken lightly. We know that money is tight, and a number of options have been explored to prevent our residents having to dig even deeper into their pockets and to minimise the impact it has on them.
The council tax increase for 2020-21 is less than we needed to make in 2019-20. It’s also important to remember that council tax only contributes towards 19%, a small proportion of the total amount of money we’ll spend delivering our services.
Does this proposed increase include Fire and Police services?
No it doesn’t. The 3.9% increase is just for the part of the council tax bill that’s paid to us for the services we deliver. We don’t pay for the Police and Fire Service out of our budget – they set their own council tax precept for the services they provide. This precept is paid over to the Police and Fire Authorities respectively.
If you live in an area that has a Parish Council, you may also have to pay an additional amount that is set by the Parish Council.
What will the proposed 3.9% council tax increase mean to me and my family?
The financial impact of this proposed increase will depend on the housing band in which you live. The table below provides the total weekly, and annual increase based on your house band:
|South Yorkshire Fire Authority||£41.44||£49.73||£58.01||£66.30||£74.59||£91.17||£107.74||£124.32||£149.18|
|South Yorkshire Police Authority||£110.02||£132.03||£154.03||£176.04||£198.04||£242.05||£286.06||£330.07||£396.08|
|Total 2020/21 council tax||£1,007.74||£1,209.31||£1,410.86||£1,612.41||£1,813.97||£2,217.06||£2,620.18||£3,023.27||£3,627.94|
|Total monthly charge||£83.98||£100.78||£117.57||£134.37||£151.16||£184.76||£218.35||£251.94||£302.33|
|Total Weekly charge||£19.38||£23.26||£27.13||£31.01||£34.88||£42.64||£50.39||£58.14||£69.77|
If you live in an area that has a Parish Council, you may also have to pay an additional amount set by them which we collect on behalf of the individual parish precepts. This amount can be found on our council tax bands and charges web page.
Why are you proposing to increase council tax?
With further cuts from government funding and the ever-growing pressures on our services particularly social care and annual inflation, we would have to cut vital services if we didn’t increase council tax as other forms of funding are simply not there.
It’s important to look at the bigger picture; the council tax income we receive only contributes towards around 19% of the overall gross cost of delivering our services, and core statutory services are underfunded. Our spend, per head of the population, for both adults and children’s social care is one of the lowest when compared with our statistical neighbours.
The increase made to council tax has not been made lightly and we’ve considered many options to keep the council tax increase as low as possible. However, unfortunately we have not had much choice without having to make further cuts to the services we all need.
How will my council tax be spent?
The general council tax contribution helps meet the running costs of all the services we provide in the borough - such as schools, social care, maintaining roads, waste collection and recycling, libraries and health protection.
The government precept contribution is ring-fenced specifically to support the rising costs of adult social care and the Excellence in Care programme.
The council tax you pay each year is used to help deliver services that you need.
Why do I have to pay for adult social care as part of my council tax?
The adult social care precept was introduced by the government in 2017-18 to allow local authorities who provide social care to raise additional funds to spend on adult social care. The number of older people living in Barnsley continues to grow - it’s estimated that from 2020-2021 our population of over 65’s will have increased by 2 per cent (1,000 people) to 49,900 people. This puts a lot of pressure and demand on our social care services bringing with it a huge cost and impact on our budget.
In 2020/21 Government have allowed councils to charge an Adult Social Care Precept of 2%. Because of the ongoing pressures within this service together with the introduction of the Council’s Excellence in Care programme the difficult decision has been taken to charge this levy.
You and your family members may not need to use our adult social care services at the moment – but you may one day. It’s similar to paying National Insurance to support the NHS.
Why do I have to pay for services I don’t use?
Just like you may not feel it’s up to you to pay towards adult social care services, you may feel the same about other services that you don’t need or use. Lots of the services we provide are used to benefit everyone and without them the borough would grind to a halt - such as bin collections, maintaining roads and public health. Some services are used by fewer residents depending on personal circumstances - such as children’s social care, home support for the elderly and special educational needs.
Council tax is a bit like income tax – it’s not a charge for individual services and it would be impossible to tailor-make every households bill based on personal circumstances. Another thing to remember is that we never know what’s going to happen in the future and what help or support we may need.
If you’re proposing to increase council tax, why can’t you deliver more services instead of asking us to do more for ourselves?
Whilst there are still a number of savings that need to be made, the increase in council tax will help protect and limit the cuts we need to make to the vital services we deliver. The increase in council tax reflects the reduction in funding we receive and cuts to be made. Regardless of the increase in council tax, we still need to make £7.4 million in savings during 2020-21.
We’re working tirelessly to make our resources go further and lead to sustainable outcomes so we can be prepared for the further challenges we face - financially and in terms of the growing pressures and demands on our services. We’re trying to do more with less and focus on those areas with the biggest impact in the long run.
Instead of proposing to increase council tax, why don’t you use money from the reserves?
In household terms, reserves are similar to the money people save for one off events or if unexpected things were to happen - such as your boiler or car breaking down or if you’re unable to work because of illness, or if you are wanting to spend money on a large purchase like a holiday or home improvements.
By law, all councils are required to hold a minimum reserve called a minimum working balance (MWB) which is calculated by determining the risks we may face. The MWB is intended to set aside enough resources to provide a backup or contingency in the event that any such risks become a reality. Our MWB for 2020-21 remains at £15 million – especially in light of the future uncertainty we face. This amount has also been agreed by our external auditors as being an appropriate level to help the council deal with any future potential risks that might occur.
Other available reserves are derived from selling assets (called capital receipts) or year-end underspends which generate ‘one-off’ pots of money. These reserves are not used to meet any short falls in the budget – they’re to be utilised for one off capital investment or priority investment schemes. Once these reserves have gone, they’ve gone and take time to replenish, so it’s really important that reserves are prioritised to either provide a return on our investment or to contribute towards supporting a service to achieve a sustainable position in the future.
How much does the council hold in reserve?
The majority of reserves the Council holds are earmarked for specific purposes including:
- Supporting wellbeing and managing demand for statutory services
- Positive environmental impact and Zero Carbon objectives
- Support the renaissance of the Town Centre and Principal Towns
- Improve the efficiency of the council and Invest to Save
- Support the growth of the Digital sector in Barnsley
- Making a visible difference in communities
The council does hold a £15M minimum working balance which can be used in emergency if required.
How do we work out how much we pay our staff?
Our pay policy sets out the arrangements for salary and related allowances paid to employees. This is refreshed at the start of each financial year and for 2020-21 will be updated once approved at Full Council.
It details the arrangements for the determination of salary, how those salary levels are determined, the method for pay progression and the payment of allowances.
You can also find details of the salaries and job titles of senior employees whose salary is more than £50,000 on the website.