All town halls across the country are facing difficult decisions in order to provide local services and make their budgets balance. There are a range of key challenges that we face when setting the budget.

Reductions in Central Government funding

To tackle the financial crisis, the Government reduced spending that effects many public services, including local government. We are highly dependent on Government funding. Any reductions have an impact on the services that we provide to the public. The table below shows how much less funding we'll have received over the three year plan period.

In many cases, we have no other choice than to make difficult decisions about the level of services that we provide and to whom although we are limiting any frontline service cuts by becoming more efficient.

Demographic change

The most significant expenditure we have is for adult social services - over 42p in every pound we collect in Council Tax is spent on care services. According to Government statistics, the local increase in the number of over-65s is projected to be 6.7% and the over-85s the figure is 7.7% over three years. 

The birth rate locally continues to rise and data shows the rise to be greater than that projected by the Government. Numbers of live births have been increasing over the past ten years from 1,662 in 2001 to approximately 2,000 in 2012. 

Both factors mean an increasing demand on our services.

Rising costs

From the ingriedients that go into community meals to the asphalt being laid to improve local road surfaces, every raw material that the Council needs to provide local services is effected by inflation just like any other household budget. Although we are working extremely hard to become more efficient, high inflation rates over recent years mean

Government legislation

The Government is also passing new legislation which has an impact on the services that we provide. For example, there are changes to education and the role of Academies. This also provides opportunities. For example, the West of England City Region Deal offers the Council the opportunity to access part of an overall package of investment worth £1 billion over 25 years to support economic growth.

This includes retaining around a third of the Business Rate growth from new businesses – although the rate is set by the Government.

This provides an extra incentive for the Council to invest in projects that create new private sector businesses, like the Bath City of Ideas Enterprise Area. The New Homes Bonus is also providing additional finance from central Government as well as the extra Council Tax raised from those homes to maintain services.