‘Difficult decisions’ ahead as Thanet council discusses 2022-23 budget shortfall

Financial news

A Thanet council budget deficit of £691,000 has been forecast for the 2022/23 financial year, with plans to plug the gap including deleting vacant job roles and a senior management restructure which could save some £100,000.

Proposals will also include an increase in fees and charges by at least 2%, – not including on-street parking charges- and an increase in the Thanet District Council element of residents’ council tax.

The shortfall is less than the £1.8million previously predicted for 2022/23.

Thanet council only gets a small amount of the overall council tax with the rest going to Kent County Council; Kent Police and Crime Commissioner; Kent Fire and Rescue Service and Town/Parish Councils. This means households in a Band D property in Thanet will be paying TDC 68p per day for the services it delivers.

Savings of £573k identified to date include:

  • £280k from the removal of vacant staff posts
  • £25k from other staffing changes such as agreed reduction in hours
  • £57k from contractual savings
  • £50k from a reduction in the amount set aside for bad debt
  • £30k additional income for bulky waste
  • £33k of additional rental income

A £1.17million spend for growth includes:

● £30k for Regeneration
● £402k for Waste Collection
● £85k for Legal
● £400k for Homelessness
● £160k for Your Leisure

There is also predicted to be:

● £50k reduction in income for Building Control
● £50k reduction in income for Licensing.

A report to Cabinet members says another option could be to ask for staff for expressions of interest in voluntary redundancies. A ;service redesign’ is also proposed.

The report says: “After a decade of austerity our services have been subjected to a series of efficiencies and savings reviews and as such there are very few remaining opportunities to implement savings without having an effect on service configuration and consequently our residents, customers or staff. In other words, almost all the ‘easy-wins’ are gone and almost all savings proposals will involve difficult decisions to be made.”

With low reserves and substantial reductions in Government funding, the report cites other financial pressures facing the council. These include: inflation, shortfalls in payments of council tax and business rates, and increases in national insurance contributions. There are also increasing demands on key council services including homelessness and waste and recycling, as more domestic waste is being generated due to home-working and more homes in the district.

The council has also been faced with paying out some £733,000 for legal costs due to on-going disciplinary and grievance proceedings at the authority. Some savings may be made from cases being concluded in actions to be taken following a damning report from auditors.

A further £280,000 has been agreed as settlement following the exit last month of former top officer Tim Willis.

The report sets out three budget scenarios of neutral, positive and pessimistic with shortfalls ranging from £60k to £2million for the financial year.

The report says there are shortfalls in council tax and business rates collections, adding: “The impact of Covid-19 on the council’s council tax income could manifest from the ending of the furlough scheme, and increased unemployment from an economic downturn (resulting in more Council Tax Support (CTS) claimants and non-payment by those not in receipt of CTS).

“Business Rates income could similarly be hit by business failures from an economic downturn. There is also the cliff-edge of the end of Business Rates relief for small businesses and those in retail, leisure and hospitality, with those businesses expected to start paying rates again. It is also highly unlikely that there will be a business grants scheme in 2022-23.”

Cuts to government funding

Thanet council income has been significantly cut since 2010 with huge reductions in Government grants.

The report says: “Over the last decade the council has gone through a series of cost cutting, budget saving and transformation programmes in order to find the reduction in resources needed to balance the budget.

“After more than a decade of austerity, the council received £8m less in government funding in 2021 than we received in 2010, this equates to a 60% cut in funding. Our funding and spending budgets have reduced from £23m in 2010-11 to £17m in 2020-21, a £6m or 26% cash reduction, but after considering the impact of inflation over the period we now have less than half (45%) of the spending power that we had in 2010.”

Cllr David Saunders, Cabinet Member for Finance at Thanet District Council, said: “Much like many other local authorities across the country, we are faced with a delicate financial position as we try to plan for the year ahead. At this stage, we must make a number of assumptions to ensure we proactively respond to the financial pressures we are likely to face in the not so distant future.

“These financial pressures, which were evident even prior to the impact of the Covid-19 pandemic, coupled with significant uncertainty surrounding the amount of funding we will receive from central Government, means we are presenting a strategy which very much plans for the worst in a bid to achieve greater financial security for the council further down the line.”

Thanet District Council will discuss its Budget and Medium Term Financial Strategy 2022-26 at a Cabinet meeting on Thursday 18 November.

Once agreed, the Budget and Medium Term Financial Strategy is used to set more specific details around how the council will allocate its future spending. This information is then included in a Budget Report which is published in January for Cabinet approval and then to Full Council the following month (February 2022).

The money that the council uses to fund public services is made up of Council Tax receipts, income generation including from fees and charges, retained Business Rates and any Government funding. Thanet District Council receives just 13p in every £1 of Council Tax.

30 Comments

  1. Tribunal payments and redundancy payments are more than this amount. Get rid of the top management team. The council will be more efficient without them!
    What about the parking charges at £1.40 per hour resulting in empty car parks and no one seems to be collecting any money anyway in Ramsgate.

      • I don’t know which car park is the marina car park? Is it near the draw bridge? If so I don’t know whether they paid as you cannot see anything on their dashboards, and around the external areas like Wetherspoons, there are double yellows in most places yet csrs park without paying. This seems to be the case in Eastcliff old swimming pool and the large car park usually nearly empty. I just cannot see evidence that people pay and at £1.40 I can see why. I think the swimming pool carpark/Eastcliff was/is more than £1.40?

  2. They could save more than enough by stopping the extravagance of funding a £2 million portion of the unmanned railway station and the huge price of upgrading of the Ramsgate harbour pontoon for a private company. Both of these unnecessary pay outs of much needed funds should be stopped to save charging even more on council tax next year.

  3. There is a difference between the capital and revenue budgets but it seems ‘one off’ payments of over £1m on legal and redundancy (so far) and £2m on Thanet Parkway are matters of serious misjudgement and mismanagement that are hitting the revenue side.
    Much of this was predicted by the council or wilfully committed by it yet both officers and members failed to plan and carried on speculative spending regardless.
    Thanet has one of the poorest records for council tax collection and I had to laugh at the bit about ‘as more domestic waste is being generated due to home-working and more homes in the district.’. NOTE TO OFFICERS AND COUNCILLORS: there are another 17,000+ homes in the pipeline – they too will have bins!

  4. The budget has been built on sand for many years. Balanced by identifying “savings” which never actually materialise, “service transformation” savings which never produce anything etc etc. Add to this almost £1m of what I colloquially call the “TDC backstabbing fund” and you have got a Council teetering on the very edge of bankruptcy canyon.

    Of course the senior managers are culpable but please don’t forget the elected members’ role in this. They wave the budget through every year, knowing full well it is as flakey as anything but backed into a corner knowing that they need to approve it to get the Council Tax agreed.

    Very sad state of affairs all round.

  5. 1. We need the best local people to locally govern. Not petty squabblers and other reasons (many).

    2. In return i would be more than happy to pay 12.5% extra per annum going forward on my council tax.

    1 is doubtful!

  6. We don’t need THANET Council. Ramsgate council soon found £10,000
    of TAXPAYERS money to put into the Jenny Dawes pot. They can find another few bob to keep the town clean employ their own rubbish collections. In fact all town councils should be fully responsible for their own Town like they used to be pre 1974. Since “reorganisation” it’s been nothing but dis-organisation.

  7. The council’s statements would be almost credible if they’d also accept that the reserves have been severely depleted over the years by poor decisons and overly optimistic assumptions, an inability to acknowledge such failings is little more than an invitation to make more.
    How many other matters that haven’t been disclosed are financially detrimental to the district but remain buried under the guise of legal/commercial confidentiality?

    • To add to the above, the departure of just one of the senior management team with the associated pay offs , restucturing and subsequent new appointments will blow any budget straight out of the water.

      • I cannot understand why the management team are not under written final warnings, indeed there appear to be enough reasons for them to be sacked now. Is it that the Lead Councillors have not got the courage to do what should have been done years ago. Why do the ‘top’ management, even after the failure of their governance have to be compensated for poor performance?

  8. Time to abolish thanet DISTRICT council and divorce from the remote kent COUNTY council and join a local unitary authority for east kent meaning less councillors, less council staff, and less council taxes

    • I agree to the abolishment of this disastrous Council, but centralizing incompetence in another location is not the answer. The public sector model for managing our towns and cities is obviously failing so we need to look at places where it is not failing and copy the best practices of others. Other countries in Europe have a lot to offer in terms of local management of resources, let’s get the Universities and others to research the best ways to go forward.
      In the meantime replace the ‘top’ team with appointed temporary professionals.

    • Do you not remember the EKH fiasco, touted at its formation as a single body able to make substantial savings through economies of scale, which would have all been very well if each council involved had the same aims , goals, political outlook.
      Why would joining all services under one umbrella be any more likely to succeed? And thats without the all to ample opportunities for “irregularities “ .
      Though no doubt your suggestion is more a political than practical move.

    • Oh dear Mr Lewis. And what difference will that move make. Just another hash up of same tired local politicians put up by minority. Having watched recent TDC meeting, I despair at quality of these people who make such important decisions.

  9. If we need to raise additional revenue (and we do) then we should introduce parking charges at our beaches. I know of nowhere else in the country where you can park near a beach (Palm Bay and Botany Bay being good examples) for nothing. A residents aprking scheme would raise vital revenue

    Otherwise, I agree, a Unitary Authority would save tax payers money

  10. Just so I’m clear… There is a £691,000 defecit in the TDC budget and £733,000 has already been allocated in legal fees as a result of disciplinary and grievance proceedings which, if we are told correctly, are the result of a toxic senior management team and dire leadership. Not to mention a further £280,000 settlement for Tim Willis.

    So, what TDC are saying is, if they weren’t so profoundly dreadful, corrupt, toxic and nasty, they would actually have a budget surplus coming up, rather than a defecit. Instead, thanks to their complete inability to conduct themselves appropriately, they are picking our pockets to bridge the gap.

    Seems legit.

  11. Barry Lewis is right about a Unitary Authority being one step in the right direction;the other is for elected councillors to outrank the overpaid and incompetent management team and to remove all officers who refuse to obey elected members.
    Senior officers are very prone to reminding elected councillors that they must do as officer recommend or risk personal liability for decisions.

    • As a former officer, the idea that I should have obeyed elected members, regardless of what it was they were asking me to do, is laughable. If you had ever worked in that environment you may understand. Yes, there are some terrible senior managers and officers. But equally, the calibre of our elected members is diabolical. Who on earth would blindly obey the likes of the Tomlinsons, the Bayfords, Rick Everitt, Shonk, the Saunders et al? Seriously, you’d have to be on acid to listen to/trust any one of them to know the difference between their backside and their elbow.

      • Quite agree, problems in management and some pretty appalling officers aside, the council employs officers who have studied and trained in their respective disciplines and are hopefully largely not performing their jobs on political views. They are meant to act professionally and provide a degree of continuity smoothing the erratic path an endless stream of differing political idealists ( councillors) would wish to pursue, often wanting to change tack because of the colour of their rosette or personal whim. Councilors like many politicians want to create a legacy and rarely look at the financial cost of their lofty wants.
        Then we have the calibre of councillors rarely schooled or widely read on the matters into which they want to delve. If as per the above comment officers are meant to be responsible for their decisions canwe have some sort of redress against councillors?
        A striking recent example is where a councillor ( previously employed in the offshore windfarm sector and so will have had a lot of instruction on health and safety and risk assessment) was alledgedly swimming having ignored warning signs and witnessed a sluice being opened but did nothing.
        Should any such person be let loose with duplo let alone lego, but its suggested their instructions should overrule professional officers.
        Is it any wonder Thanets the troserless dogs dinner it is?

      • Personally I wouldn’t admit to being a TDC officer. Most of the above were not able to get their mitts on the levers of power, and those who did soon found that the SMT had purloined the levers and kept them under lock and key in the office.
        That said, those named above were not in the ‘Honest Sandy Ezekiel’, Cyril Hoser or the ‘Fake sheiks’ category.
        Thanet’s problem is that is the unloved child of a political fix in the 1970’s.District Councils were created because the rural minority worried that they would be ‘swamped’ by urban interests. What happened was the rundown of many coastal communities by rural interests who had no care for urban areas and whose sole interest was holding down expenditure come what may.
        Thanet is just a very bad example of a District Council. No one loves it, it run by nincompoops, and the tail(officers) wag the dog (council).
        I don’t see them making savings of the order that are required, and with all respect to David Saunders, his party, the Conservative party, are 100% responsible for austerity and the near bankrupting of local govt. If the treasury is allowed to play financial Jenga with local govt finance for 12 years, what do you expect?
        I agree with Cllr Lewis that an East Kent unitary council may be the only viable course of action, but don’t expect it to deliver a financial miracle. Local govt needs refinancing, a fairer form of taxation, and a more broader form of representation, that reduces the amount of deadwood being returned year after year.

      • It is most unfortunate how Local Government has evolved.

        No longer is there much of a tiered structure of experienced and dedicated officers who are there to undertake various roles in various disciplines for the betterment of the area and its residents as a whole.

        The premise now is merely saving money and failing to do the basic tasks whilst at the same time wasting vast sums on other issues. There is a management team at the top who see their role as purely managers (and yet most have little or no knowledge in their supposed disciplines) and the minions at the bottom who have little or no sense of direction or purpose.

        The professionals have long since retired (or been made redundant as their knowledge and skills showed up the successive management teams as the incompetent fools that they are).

        • But much of the change stems from the desire to distance themselves from responsibility for their actions, building control decided not to offer insurance backed guarantees for new homes ( as required by mortgage lenders from 2003)and so lost the backbone of their work, the experienced staff left to work in the private sector that did offer guarantees. Planning fees are set by central gov. amd don’t reflect the cost of applications ( though much complicated by the councils whims). Loads of examples of where it all went wrong. But it must also be remembered that at one time TDC staff sickness averaged 16 days per employee per year, like the nhs councils would happily consume every penny in the country given the chance.

  12. Councillors just imagine if any excess spending over the agreed budget for the financial year came out council pension schemes the problem would be solved you would make sure your where within budget.

  13. It seems that everyone is of the same negative opinion of TDC. It is a failed organization and in its present form with the current team leaders, it will never succeed for the benefit of local taxpayers.
    The idea of a democracy is a farce and only means that no one takes any notice of the electorate for the period of the parliament/council, then they wake up, promise the earth and then take no notice of us again!
    The minister in charge of local government, Gore, is supposed to take this on board via Sh’s complaint to his Department, but don’t hold your breath that anything will change in the short term, and don’t expect the local conservative MP’s to voice an opinion in Parliament about the sorry state of the local administration.
    For a Council political leader to be able to take on a toxic group of paid officials is beyond most people particularly if they are interested in just having local power or striving for a political aim.
    Would you like to run a committee of 57 representatives? 10 is the most that are efficient and effective in any meeting situation and the public sector holds many records for meetings in the hundreds as a matter of course.
    The only solution that I can see is that a professional team is put in charge and they train up people who they deem are trainable in the management of both people and resources.
    It cannot be right that there have been no written warnings and dismissal proceedings against any employee who has not performed in accordance with their contract and professional ethos.
    There are many retired managers Thanet who I am sure would welcome some sort of involvement in ‘saving Thanet’.
    The local political parties do not have the resources or abilities to do this without training.
    So, how can we go forward and save Thanet!!!!!!!!!!1

Leave a Reply

Your email address will not be published.


*


This site uses Akismet to reduce spam. Learn how your comment data is processed.