Budget proposals to continue delivering spending reductions following significant progress this year

Shropshire Council has published proposals to continue working towards the objectives in The Shropshire Plan through its updated Medium Term Financial Strategy 2024/25-2028/29 (the MTFS).

Published today, the MTFS details how the council plans to offset budget pressures in the next financial year largely due to rising demand for services and inflation, expected to total £49.8m. This includes the general pressure we outlined at the last 2024/25 budget update of £24m, which has now risen by £1m, and takes account of the specific up-to-date projections of increasing demand and rising cost for social care of an additional £24.4m.

Proposals include increasing council tax by 4.99%, helping to ensure that key services supporting local people are as far as possible protected.

This increase in council tax reflects what the Government funding calculations expect the council to do, and what will be assumed within the local government funding settlement due later this month. This includes a 2% precept specifically to support adult social care.

A 4.99% increase in council tax is equivalent to £1.57 a week for the average household in Shropshire (the local average at band D).

The council’s funding gap exists principally because of continuing and increasing demand for services in adult social care and children’s social care, which accounts for almost 80% of the council’s budget. Around four fifths of every pound we spend goes to support social care for our most vulnerable.

The cost of delivering many services has also risen, due to continuing high levels of inflation and the impact of the ongoing cost of living crisis.

Shropshire’s size and sparse population puts more pressure on council budgets: it is more costly to deliver many services in such a large, rural county.

Furthermore, the county’s population is proportionately older than in many other parts of the country, with 30% now over 60 and an increasing number needing social care support.

Despite these challenges, at seven months into this financial year the council is on course to deliver spending reductions of £41m towards its target of £51.4m – with five months still to go, this is already the most it has ever achieved.

The remaining amount is targeted across the third and fourth quarters of the financial year, with council reserves at a healthy level to provide further resilience.

Progress made this year will put the council on a more secure footing towards a sustainable budget position. So far this year, this includes:-

• Investing in early help for families, to put support in place before issues become more serious, requiring more support. This improves outcomes for children and young people whilst reducing costs for the council, helping to manage future demand.
• A new virtual care delivery project, using innovative and personalised technology to connect residents with a remote care team for wellbeing checks and self-care prompts, increasing independence and allowing people to stay safely in their own homes for longer.

Next year the council will build on the great progress already made and transform in more innovative ways to embed the changes and create a sustainable financial model that delivers The Shropshire Plan.

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

“The proposals in our Medium Term Financial Strategy continue the significant steps forward we have already made this year towards a sustainable and secure financial future.

“We are not alone in the challenges we face as a council, and there have been many reports this year of other councils that have been unable to overcome these.

“By contrast, we have a robust plan to tackle the situation and the evidence is that our plan is working. The best way forward is to focus on our priorities and keep up the steadfast control that we have demonstrated this year.

“Pressures from demand, inflation and the cost of living mean that we will need to accelerate some parts of our plan, adapting to the challenges we face.

“We are protecting frontline services, investing in prevention and modernising our approach to delivery, with strong and consistent leadership ensuring that we remain on track into the next financial year and beyond.

“We have been clear that there will still be difficult decisions to come, and the upcoming budget consultation will allow us to understand the priorities of people in Shropshire, to help shape our next steps.”

The proposed Medium Term Financial Strategy 2024/25-2028/29 will go the council’s Cabinet on Wednesday 13 December 2023.

A consultation on the council’s budget proposals will then begin before Christmas, and will seek people’s views on the options it faces to reduce its spend and manage demand for its services.

The consultation is expected to run until the end of January 2024, with the council’s budget set on Thursday 29 February 2024.