Why national debt is forcing councils to plan for cost-cutting

4:00pm Friday 12th March 2010

By John Geoghegan

AS Labour and the Tories battle it out over ways to reduce Britain’s huge national debt, one thing is for sure – cuts to the public sector are inevitable.

Fears that services such as libraries, which councils are not legally obliged to run, would be effected by cuts have been played down.

But authorities are planning to share more resources, cut job posts and work more efficiently to cut costs.

A recent survey by the BBC suggested tens of thousands of council jobs in England – almost one in ten of the workforce in some councils – could be at risk over the next five years as local authorities are forced to cut back.

Essex County Council and Southend Council are planning to reduce job posts because of the lean years ahead, but both have said there will be no compulsory redundancies.

Staff at Basildon Council have been sent e-mails saying the authority is in talks with Chelmsford Council about merging services including waste collections, planning and council tax collection in order to save money, although both councils stress no jobs are under threat.

Southend Council chief executive Rob Tinlin says he thinks there could be about 300 fewer jobs at the authority, which currently employs 2,200 people, over the next five years.

“That’s not a definite figure,” he said. “We won’t be making 300 people redundant.

“All our efforts will be about keeping services and keeping staff, but it’s going to be tough.

“We will need to redesign our services and if our guesses are correct, 300 fewer jobs could be the implication.”

This year, the council expects to shed 38 posts through staff leaving or retiring, rather than compulsory redundancies.

However, certain departments, such as children’s social workers, will get more staff.

Essex plans to divert £30million from back-room processes, like administration and IT, to preserve so-called frontline services, such as schools and social services.

Last month, the county council announced up to 275 line managers would go, through voluntary redundancies, retirement and not filling current vacancies, as part of the savings.

The county council also plans to work more closely with the police and health services on some services.

Essex has not said how much its spending will be reduced, but vowed to save £55million this year, as part of an ambitious efficiency drive to save a whopping £300million by 2012.

The Government provides a large portion of councils’ money, though this varies between authorities, with the rest coming from council tax and fees and charges, such as parking tickets.

Mr Tinlin said he expects the council to get about 5 per cent to 10 per cent less money from the Government from 2011 onwards, when the current grant programme ends, which would probably mean council spending has to fall by a similar amount.

The council is already working with other authorities, like the police and health trusts, as well as neighbouring councils which they work with on waste disposal.

Mr Tinlin said this sharing of resources would be one of the main ways the council could cut costs further.

He added: “There is no other way to raise money other than the joint delivery of services.

“The Government has said it will ring-fence particular services like health, education, maybe the military.

“So the rest of the public sector has to take a disproportionate high amount of the budget reduction.

“It’s an irony financial services got us into this recession, but it’s the public pound which is now having to bear the brunt of getting us out of it.”

Mr Tinlin denied so-called “discretionary” services, that are not a legal requirement for councils to provide, like libraries, would be more likely to be hit.

He said the council had not yet discussed which particular services would be more vulnerable to any Government cuts, but the cabinet would discuss its medium-term financial plan, from 2011 onwards, at its next meeting.

Concerns have been raised by Unison, the trade union representing local Government staff, that councils cannot be squeezed much further.

Southend branch secretary Claire Wormald said: “It’s going to be a squeeze across the board.

“So we don’t think it’s appropriate for them to be expected to make even further savings.”