There is absolutely no doubt that the ConDem Government has heaped hell on Salford with cuts that have been harshest for councils with the greatest need than the Tory shires. The average cut in funding nationally for councils has been 12.7% - for Salford it's been 15.5%. It's disgusting, it's disgraceful and it's hitting the most vulnerable people in the city most of all. You'd have to be living in a penthouse in MediaCityUK not to notice it.
Meanwhile, Salford's Labour Council and Mayor have been milking it like mad, with Ian Stewart telling a meeting of Salford Council last month; "The Government told us we were to face a further £31million cut in the forthcoming year and a further £26million the year after...More heartache for Salford families, decisions that we don't want to make...It is heartbreaking for councillors to make those decisions... If the Government did not take the money away from Salford we would not be making those cuts..."
There was actually a ripple of applause from councillors in the chamber. Yet a new huge report which will be placed in front of Salford Mayor Ian Stewart next week doesn't appear to paint the same picture.
Indeed, despite the Mayor also stating at the meeting that "Our approach has been one of exemplary scrutiny" there are still lots of questions that need to be asked and answered before this budget gets rubber stamped in March.
For a start, the Mayor said that the Government has "told" Salford Council it needs to make £26million cuts in 2016/17, which it's already planning. The official Council report states in a section, titled `The important statistics' and in bold, that "Only the year 2015/16 is covered in this settlement. There is no indication of how local authorities will be affected in 2016/17 and beyond."
Next up is that actual 2015/16 cut from the ConDem Government. In the Council report this is cited as £22.565million, but adds that the funding gap is £30.722 (excluding a £1.5million Social Fund/Distress Fund cut). There's an £8.157million difference between the actual cut and the Council cut.
The report states that the extra is needed for `expected pay and price inflation; capital financing costs arising from new borrowing; emerging and expected new spending pressures; adjustment for assumptions around the use of reserves; changes in the level of specific government grants; the level of earmarked reserves; issues emerging from the 2014/15 budget monitoring...'
With pay increases running at 1% and inflation running at 0.5% this comes to nowhere near £8million. Meanwhile, the reasons for the extra cuts also mentions the `reserves'...
Reserves are money which is held by the Council separate from any spending: like it says on the tin, it's held back `in reserve'. The report states that Salford Council's `reserves' have actually increased, from an expected £12.4million to £13.3million in 2014/15, and in 2015/16 they are forecast to be £13.6million. Yet none of this money is being used to mitigate the cuts.
Indeed, it reads as though some of the £8million extra cut in budget is being used to prop up `the level of earmarked reserves' which, bizarrely, in turn, are being used as a contingency for cuts that might not be able to be implemented.
Last year the Salford Star revealed that the Council had £6.5million set aside in `reserves', taken from within the cuts budget, for `Non-achievement of Savings' (see here). This year the `Minimum Reserve Needed', for `Non Achievement of Savings', is £3million. Which begs the question, `Why doesn't the Council just knock that amount off the cuts in the first place and save everyone the heartache?'
Meanwhile, in another Treasury Report going to the Mayor, it states that Salford Council is to receive £92million – yes, £92million – from the Government and Salix Homes combined for flogging off (transferring) its council houses. The report explains that the Council is looking for `optimum application' for its new found wealth.
After consultation with its (no doubt handsomely paid) `advisors', Capita Treasury Solutions, the Council has decided to pay off some of its short term borrowing debts which would "reduce the local authority's high level of external debt"...rather than using it to mitigate some of the worst cuts.
Some might argue that if the debt was reduced then pressures on the Council's revenue budget would also reduce but part of the extra £8million cuts is going to pay for "capital financing costs arising from new borrowing".
With Salford Council officially declaring that in 2015/16 there will be £32.5million cuts with 580 jobs lost, and eighty people at risk of compulsory redundancy, and that in 2016/17 there will be a further £26million cuts, there's still questions to be answered...
1) Does the cut really need to be £32.5million?
2) Why is the Council working towards a £26million cut in 2016/17 when even its own officers are saying no-one knows what will happen?
3) Why aren't the unexpected increases in reserves mitigating the cuts?
4) Why is the Council putting £3million aside for cuts it might not achieve rather than not making the cut in the first place?
5) Why isn't the £92million from Salix and the Government being used to mitigate the cuts?
The Salford Star knows that neither Salford City Council nor Mayor Ian Stewart will answer these questions...It hasn't answered any Salford Star questions for over a year. But when the Mayor says at a public Council meeting that "Our approach has been one of exemplary scrutiny...We have genuinely tried to engage with all stakeholders and partners", then the community itself deserves some answers...
* See previous Salford Star article - Now Children Take The Axe - click here
Graphic by Steven Speed
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