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Consultation opens on future budget as Council Tax set to rise by nearly 4%

Councillors have called on the government to reverse a decade of cuts and fund essential services properly.

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Photo by Anton Velchev on Unsplash.

Sheffield City Council have opened a public consultation on the city's budget for 2021-22, warning that further cuts may be needed to balance the books.

The new proposals are a response to a £60m overspend this year due to coronavirus. Councillors say that the government has failed to support the city properly during the pandemic.

The ruling Labour group are proposing to raise Council Tax and the Adult Social Care Precept by 4.99% – the maximum allowed by law – to help make up the shortfall.

“After facing a decade of austerity measures and budget cuts we have been responding to this crisis with resources already stretched and it has left us with a shortfall of £60m in our budget," Cabinet Member for Finance Terry Fox told Now Then.

"Without significantly more funding from central government we are facing an enormously difficult year ahead with some very difficult decisions to make."

The consultation, which closes on 19 January, explains how the budget works and asks Sheffield citizens which services they would like to see more or less money spent on. These include education, housing, public health, leisure and culture.

Like local authorities across the country, 47% of Sheffield Council's day-to-day spending is paid for by grants from central government. Only 16% is funded by Council Tax.

The government have indicated that they want to shift responsibility and blame for post-pandemic tax rises onto local councils, forcing them to hike Council Tax to cover shortfalls.

Unlike Income Tax, Council Tax is a regressive tax, meaning that it unfairly hits the poorest households more than the richest.

Between 2010 and 2018 central government grants for local authorities across the UK were reduced by nearly 50% in real terms and the spending power of local authorities fell by 28.6%.

Many local authorities are now barely able to fund services they are legally mandated to provide, with Croydon Council in south London declaring bankruptcy as a result of austerity.

Cllr Fox said that local families were "understandably extremely anxious about their future" and called on the government to put their interests first.

"The government need to back local councils with the funding they need to prevent council tax rises; stop any cuts to Universal Credit; extend the ban on housing evictions and repossessions and give our priceless key workers the pay rise they deserve."

The new budget, which covers April 2021 to March 2022, will be finalised this March.

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