South Tyneside: new council tax bills set as spending plans and £13.1million of savings also laid out
Council plans for millions of pounds of cost savings and a council tax rise in South Tyneside have been approved – despite criticism from opposition councillors.
The latest authority-wide meeting of South Tyneside Council saw budget plans for 2025/26 backed by majority vote as part of the borough’s medium-term financial plan.
The proposals include £13.1million savings as well as using around £600,000 of its reserves.
The council also agreed a council tax increase of 4.95%, which includes a 2.95% increase in core council tax and 2% for the government’s adult social care levy.
This equates to around £1.22 per week increase for Band A households, into which the majority of homes fall, and the local authority is still expected to have one of the lowest council tax levels across the North East.
Proposed savings for next year are on top of the £208 million the council has already had to save since 2010, with even more spending cuts predicted in future years.
However the approved medium term financial plans do include a package of investment worth £171m over the next five years as part of a rolling programme of capital investment for the borough.
The council has committed to continued investment in adult social care accommodation to support independent living and new children’s homes to boost provision for children who are looked after by the authority.
The local authority will also invest £29.5million in its housing stock each year for the next five years as well as supporting the building of new council properties for affordable rent.
However the budget plans include a rent increase for council homes to the maximum level allowed by government of 2.7% for the next financial year, which equates to “an average increase across all dwellings of £2.63 per week.”
The council will continue to subsidise things like school meals, home to school transport and adult social care contributions but some changes are proposed to reduce that subsidy to some individuals in a bid to reduce inequalities across the borough.
The budget was approved by majority vote at the full council meeting on Thursday (February 27), with ruling Labour councillors voting in favour and Green Group and South Tyneside Alliance representatives either voting against or abstaining.
Labour’s councillor Jane Carter, cabinet member for finance, governance, and corporate services, outlined “targeting support to make things fairer is at the heart” of the budget.
She said: “We are continuing to have to make some difficult decisions to ensure we deliver for the residents of South Tyneside while ensuring longer term financial sustainability.
“This will involve some further reduction in post numbers, which will largely be managed in natural turnover.
“This is a budget which requires tough decisions and I can assure members and residents that all options have been considered when coming to these decisions.”
She added: “How we allocate our resources has a major impact upon achieving our key objectives and the external environment means it has never been more difficult.
“I believe these proposals have struck the right balance between investment in key services, which continue to support the most vulnerable in our society, securing our future financial sustainability and applying necessary trade-offs where some residents will be required to pay a little bit more.”
The deputy council leader noted challenges facing the local authority include “a difficult backdrop of very high costs to support some of our young people who have significant mental and physical needs.”
Council leader Councillor Tracey Dixon added the budget for the coming year is “evidence led and responds to the issues being experienced by our residents.”
She said: “We will continue to be prudent and make the brave but necessary decisions so that we can remain financially sustainable over the medium and long term.
“Managing our finances well is an important responsibility particularly given the ongoing challenges where we simply cannot afford to do everything we would like to do in our borough and for our residents, this means choices and trade-offs.”
Councillor Ruth Berkley, cabinet member for adults, health and independence, noted the demand on adult social care services is “significantly growing” and they have had to make “difficult decisions” to meet the needs of residents.
A large proportion of the council’s £13.1 million revenue savings in 2025/26, some £5.3 million, is linked to reviews and changes to adult social services and commissioning.
Meanwhile Councillor Jim Foreman said: “If you’re sitting on this side and you’re sitting in cabinet and you’re having to make these decisions, it’s the hardest thing in the world, but we’ve got to deliver a fair and balanced budget.”
However the proposals faced criticism from opposition councillors.
Councillor David Francis, Green Group leader, said: “This budget is being set against the continuing legacy of austerity and despite the change in government last year there has been little meaningful change in that regard.
“The people of South Tyneside deserve better than this budget, we need to be bold enough to stand up for the people we represent and tell central government that this simply isn’t good enough.
“I really struggle to support a plan that makes life harder for the very people we’re supposed to be here to represent.”
Councillor Paul Brenen, South Tyneside Alliance Group representative, added the people of the borough are “tired of being squeezed” and the council “cannot continue down this road.”
He said: “This budget is not only asking the cash strapped public to give more via another tax hike, it’s cutting public services yet again through not replacing staff who leave or retire.”
Councillor John Robertson, his South Tyneside Alliance Group colleague, added: ““It’s £13.1million services cuts, this is impacting on vulnerable residents, public services and the infrastructure.
“It’s a desperate attempt to paper over the cracks with short term fixes.”
Councillor David Kennedy, South Tyneside Alliance Group leader, proposed an amendment to the budget to make it “more palatable” and “give something back” to residents who were being “let down.”
This included developing and expanding the existing Business and Community Response Team, reducing the proposed increased school meals price from £2.50 to £2.40 and “reversing the proposed increase” in school milk costs.
It also included increasing funding to the street cleaning team by £50,000.
It was proposed the measures would have been funded through diverting some designated community area forum funding, freezing councillor allowances and through getting rid of an additional five posts through the vacancy management scheme.
Cllr Carter noted the Labour administration are “committed to minimising job losses” and the proposal to add a further five posts to the total being removed “increases the risk of impacting upon service delivery.”
The amendment was supported by all South Tyneside Alliance and Green Group councillors but was rejected by Labour and ultimately defeated, with 21 councillors in favour and 24 against.
Cllr Kennedy added the Labour budget was “a sticking plaster for a gaping wound.”
He continued: “All this budget is going to do is keep the lights on, it’s all it’s going to do, it’s nothing long term.”
Cllr Carter refuted this, stating: “We’re not weakening frontline services, we’re actually maintaining the services, we’re not cutting them, and we’re looking to improve the services.”
Council chiefs noted the upgraded local council tax support scheme introduced in 2024 has meant over 10,000 households receive a reduction in their council tax.
Council tax bills issued by the council also include separate amounts levied for police and fire.
The council tax increase for 25/26 agreed by the Northumbria Police and Crime Commissioner equates to £9.33 a year for a Band A property.
The increase agreed by the Tyne and Wear Fire and Civil Defence Authority is £3.33 a year for a Band A property.
For more information visit www.southtyneside.gov.uk/councilbudget.
The meeting was also live-streamed on South Tyneside Council’s YouTube channel and is available to view at https://www.southtyneside.gov.uk/article/1309/Borough-Council-meetings.