Call for fairer funding as South Tyneside Council prepares to lose another £8million in 2020

South Tyneside Council recently received an indication of its settlement from the government for the next financial year 2020/21.

While it is in line with expectations, the council still needs to save a further £8million.

Despite squeezed budgets and uncertainty around funding in the long-term, town hall bosses have said frontline services will be protected.

“In the face of the financial challenge, South Tyneside Council has shown resilience and innovation,” said cabinet member for resources and innovation, Coun Ed Malcolm.

“Since 2010 we have radically changed our approach by redesigning our services to be as efficient as possible and improving quality through new models of service delivery.

“We took difficult decisions early on which has created some financial stability now, this has allowed us to protect frontline services as much as we can and invest in facilities for residents as well as creating the conditions to raise prosperity across the borough.

“However, chronic underfunding from central government does continue and our finances are still being squeezed.

“Whilst this settlement covers only the next financial year we are still left in the dark as to what and how we will raise funds in the future.”

Studies by both the Institute of Fiscal Studies and Cambridge University have shown that austerity has had an impact on local authorities, with South Tyneside the third hardest hit in the country.

In 2010, around 67% of South Tyneside Council’s funding came from central government. This has reduced to 39% in 2019/20.

As a result of these reductions over the decade, the council has had to save £168million.

In coming years, demand for services for the borough’s most vulnerable residents and children and families with the complex and intensive needs is also forecast to increase.

Coun Malcolm added that a “longer term sustainable solution” is needed to tackle these growing pressures.

“The government’s ongoing fair funding review must recognise the growing financial pressure upon children’s social care – particularly in areas with higher deprivation,” he said.

“There is a continual upwards trend in the number of children looked after, especially those with complex needs which means less resource for valuable preventative work to avoid children and families reaching crisis.

“Whilst there has been some limited increase in funding for adult social care it also remains insufficient to meet growth in demand for services.”

He added: “Local authorities continue to roll up their sleeves and get the job done, providing for our residents the best we can with limited funding and resources.

“The services that councils provide reach out to everyone, we are the first port of call for many residents. It is vital that when people need help we are able to give it to them. Over the last decade that has become increasingly difficult.

“We will continue to do our best for the borough with the unfair hand we have been dealt since 2010 whilst continuing to fight for fairer funding.”

South Tyneside Council’s medium term financial plan will be discussed by cabinet in early February next year.

If approved, it will be presented to the borough council later the same month.