Shropshire Council publishes plans to close budget gap in 2025/26

Shropshire Council has published its draft Medium Term Financial Strategy, with plans to close an £11.8m budget gap in 2025/26, after examining detail in the Government’s funding settlement announced in December. 

The council has already begun a consultation for £8.5m of new savings proposals including moving to three weekly general waste collections, reducing opening hours of the museum and castle in Shrewsbury, switching off some streetlights for part of the time and changing park and ride bus services in Shrewsbury. 

£3.8m will be delivered through plans already agreed in 2024, including reducing the size of the council by removing around 1 in 5 jobs, and more savings will be made by managing the demand for council services. 

The report finds that Shropshire’s spending power will increase by 3.1% in 2025/26 compared to 2024/25, even with the 4.99% council tax increase the Government assumes councils will make. The national average funding increase for councils is almost double Shropshire’s amount at 6%, with urban authorities benefiting the most. Shropshire sees the third lowest increase out of more than 180 councils. 

The ongoing impact of higher demand for council services, particularly for social care which accounts for £4 in every £5 the council spends, and increasing costs of services and supplies, will outstrip the increase proposed for Shropshire. 

The removal of a rural services delivery grant worth around £9m is a key pressure for Shropshire, as well as major reduction in social care funding, effectively representing a ‘loss’ of £16m.   

A new homes bonus, market sustainability and improvement fund and different pots of homelessness funding were noted in the report to bring some benefit. 

On top of the new savings plans for next year, the council expects to end the year 2024/25 £37.3m over budget and would need to use almost all of its £38.3m reserves fund to balance its budget, despite delivering £50m of savings in year. 

Gwilym Butler, Shropshire Council’s cabinet member for finance and corporate resources said: 

“In 2024/25, Shropshire Council is set to deliver £50m of savings, even more than the record £41m delivered in 2023/24, against a backdrop of the growing need for social care affecting councils all over the country. 

“However, a close assessment of the funding proposal from Government shows we will have more difficult decisions to make in 2025/26. 

“As a large rural county, Shropshire is faced with extra costs for waste collection and disposal, housing, social services, education, transport to school, road maintenance and leisure and library services.  When people are spread out over such a large area, it costs more to provide local services. 

“It is more important than ever that as many people in Shropshire as possible to have their say on our next steps.” 

Shropshire Council’s budget consultation is open until Sunday 26 January 2025  Budget consultation 2025/26 | Shropshire Council 

Find the reports with the agenda for Transformation and Improvement Overview and Scrutiny Committee on 20 January 2025.