Rising inflation at a 40-year high and increased demand on council services have led to a £24m budget pressure for the council, 14% of its overall net budget.
While government has increased funding for social care in the city by £7.9m it has reduced funding in all other areas by £1.5m. And even with the additional funding there is still a £5.6m budget gap for adult and children’s social care alone.
Proposals from the council’s administration on how to manage the situation include a 4.99% council tax increase, 2% of which will go specifically towards funding adult social care. This would raise £4.5m for the council, less than the existing budget gap for social care services alone, and see the average Portsmouth home’s council tax bill increase by the equivalent of £1.17 per week.
The proposed increase comes after more than three-quarters of respondents to the council’s budget consultation indicated they would support an increase to council tax generally and specifically to fund an additional increase for adult social care.
The proposals also include £2m savings which, along with other measures taken to address budget pressures, will balance the council’s budget for the year.
The savings need to come from £159m of council spending and will take the council’s total savings made in the last 12 years to £106m. They would largely be met by efficiencies without impacting on public services, including more than 40% from systems and services that don’t work directly with the general public.
Council Leader, Cllr Gerald Vernon-Jackson, said: “The council is affected by the cost-of-living crisis like everyone else. Things like rising inflation and energy costs mean the things we do are going to cost us more money. The government has said it will not be providing any extra funding to help with these rising costs so we need to make savings from within our budget.
“We never want to increase council tax, and it is particularly difficult to do at this time, but the alternative is to reduce services that people rely on and doing that would hurt our residents even more. We’ve had to make some difficult decisions about where to save money but most of our proposals take money from areas residents responding to our survey said we should be reducing.”
The budget proposals will be considered at the council’s Cabinet meeting on 21 February and if accepted will then go to the Full Council meeting on 28 February for final approval.
For more information see the budget proposals in the agenda for the 21 February Cabinet meeting and the budget consultation results.