In February of this year, the council revealed an additional £60 million must be found before 2027, with the aim of finding at slashing at least £15 million within the next year.
They have proposed to do this by increasing tax revenue via a 4.99% rise in council tax, the maximum they can enact without triggering a local referendum, representing an annual household rise of £63.85 to £191.55 depending on the housing band your property falls within.
Another revenue raising measure being implemented is the hiking of public service fees such as on street parking and waste collections.
Cuts to key services have also been proposed, including the scrapping of funding for the £100,000 a year crisis support service, tasked with familial support for those in abusive or neglectful households as well as assisting those experiencing economic hardship.
The impact of which will be exacerbated by the ending of the Household Support Fund in March, which Newcastle received £5.8 million from last year.
These drastic measures include raising school meal prices by 50p, alongside a £537,000 cut to the school meal subsidy program, and the elimination of 40 council positions. This is at a time where inflation, the subsequent cost of living crisis and child poverty (15% higher than UK average) has disproportionately impacted the North-East.
Newcastle City Council have authorised these proactive measures to avoid the dreaded Section 114 notice (effectively a bankruptcy declaration), a fate faced by 8 councils over the last 6 years, most recently by Birmingham and Nottingham.
The cost of COVID financial and medical support, austerity measures instigated by George Osborne and general economic stagnation have all contributed to the complete decimation of local authority finances, a fact reflected by the £4 billion funding gap currently facing UK councils.
Although Newcastle is seemingly staving off insolvency for now, it’s long-term wellbeing is reliant on this Labour council’s careful pragmatic planning coupled with close cooperation in Westminster to address the nationally pervasive funding shortfalls.
