The Council – the smallest in England in population with an overall budget of about £4 million – says three vital sources of funding are being cut further this year
General funding (Revenue Support and Rural Services Delivery grants) have reduced by a combined £274,000 (36%). This is on top of the £817,000 reduction in the previous three years, with the total amount reducing from £1,579,000 in 2013/14 to £488,000 in 2017/18. By 2019/20 this will fall further to just £178,000, a total reduction of 89% over six years.
New Home Bonus funding has reduced by £171,000 (24%), from £716,000 to £545,000.
Retained business rates has reduced by £382,000 (27%), from £1,421,000 to £1,039,000.
As a result the Council is proposing to increase average Band D Council Tax by 3.44% or £5 a year, and using some of its reserves to make sure it can continue to deliver services.
Council tax on a Band D property would increase to £152.32 per year for West Somerset Council’s proportion of the bill - £150.56 for council services and £1.76 to contribute to flood protection works delivered by the Somerset Rivers Authority.
The outlook for the following year – 2018-19 – is even bleaker with a forecast budget gap of more than £800,000.
Cllr Anthony Trollope-Bellew, Leader of the Council, said: “The challenges West Somerset Council faces are well documented. This coming year we are facing substantial reductions in our core funding while the year after that looks extremely difficult.
“Thanks to our partnership with Taunton Deane Borough Council we have achieved significant savings in the past but we need to do more.
“Our priority is – and always has been – to make sure that local people continue to receive the services they value. That is why we are proposing a new, single council covering Taunton Deane and West Somerset.
“West Somerset is simply too small in terms of population, in a very large geographical area to remain viable. The financial facts speak for themselves.
“In the future a new council covering Taunton Deane and West Somerset is the best hope of continuing to delivering an acceptable level of services in these times of reduced Central Government funding."
An additional pressure on the council in the year ahead is the pensions’ bill. The Local Government Pension Scheme has warned that costs will have to increase to cover a project shortfall due to uncertainty in the financial markets. This is not a problem confined to West Somerset.
The council has drawn up savings proposals but these are not enough to cover the budget gap. As a result, money would need to be taken from reserves to deliver a balanced budget.
Cllr Mandy Chilcott, Deputy Leader and lead member for resources, said that while the council could balance the books in 2017-18, the following year presented serious challenges: “We will need to start work early to ensure we consider all our options for closing the gap in 2018/19. This is a huge task and Councillors will face some very difficult decisions. We will do everything in our power to protect services in these extremely difficult circumstances.”
The budget report will be considered by the council’s Scrutiny Committee on January 19, followed by Cabinet in early February. The proposed budget for 2017/18 will be considered for approval at the Full Council meeting on 22 February 2017.
Debbie Rundle, on behalf of West Somerset Council,01984 635280 or 01823 356407 or 07714 759899