4.99% Increase in Council Tax planned for 2025

January 8, 2025

Important new funding for key frontline services and other projects such as boosting civic pride, fixing more roads and pavements, and boosting tourism is being proposed in the council’s draft budget for 2025/26.

Cabinet councillors will discuss the report which includes increasing council tax by 4.99% (2.99% for general use and 2% for adult social care) next week (Cabinet, 13 January, items 5 to 7). This will help fund the investment needed into frontline and statutory services and ensure that cost pressures can be met in 2025/26.

It is also proposed that several new and ongoing projects will receive funding from the council’s capital investment programme (see separate release). Ongoing work to boost civic pride will see an investment of £185,000 and ensure that City Jam goes ahead in 2025 and future years, along with an annual Southend City Day and that volunteering opportunities are promoted throughout the community. In a boost for residents, businesses and visitors, the general events budget will also be increased by £100,000.

A further £250,000 is being added to the highways maintenance revenue budget to deal with more potholes, in addition to doubling the capital investment in fixing roads and pavements. Seven new roles will also be created via investment into services, including four staff to help with the brokerage and contract management of children’s external care placements and deliver savings in this area.

Approximately £9m of permanent investment will ensure that service budgets that have been under demand and pressure in recent years such as children’s and adult social care and temporary accommodation more accurately reflect the actual costs and spend in those areas in the future. New savings and increased income proposed total £3.6m, making £5.3m when added to previously agreed savings for 2025/26. Alongside increased income from council tax and business rates, a balanced net base budget of £165m is proposed.

Cllr Daniel Cowan, leader of the council, says: “I am pleased that through hard work and having a clear vision and priorities, we can present a budget that is seeing proper investment into our frontline and statutory services, and other important projects and issues too.

“We must ensure that we continue to provide good services to local people and continue to promote our city as a great place to live, visit, and invest in, and this budget does just that.

“Whilst the financial environment remains challenging, with demand for statutory services like adult and children’s social care and temporary accommodation continuing to rise, we are protecting these frontline services by being realistic about what we need to spend in these areas and setting our budget accordingly. We are also taking action to reduce these pressures in the long-term.

“We know that many residents and businesses are still feeling the pinch too and whilst we do not want to raise council tax and other charges, we must do this to protect services, drive our city forwards and maintain financial sustainability into the future. With the proposed rise, we predict that we will still have the second lowest council tax rates in Essex, the thirteenth lowest out of 62 English unitary councils, and in the lowest 100 out of all 317 English councils.”

The council will continue to make savings in future years too and transform how it works to meet an estimated budget gap of £32.5m up to 2029/30, down from last year’s projection of £35m. A separate cabinet report (item 4) looking at finances up to the end of November 2024 shows how the forecasted in-year overspend has reduced from £8.1m at the end of July to £4.7m at the end of November.

Cllr Cowan concludes: “We have been working hard to reduce our forecasted overspend this year. This is down to £4.7m by the end of November 2024 and we will continue to work hard to bring this down further and reduce the need for use of reserves to balance the budget at the end of this financial year.

“Along with our proposed capital investment, this is a positive budget that invests over £25m into fixing our budget so it accounts for known pressures, and supports our services now and in the future, as we strive to build a city that everyone can be proud of.”

The draft budget will be considered by the council’s cabinet on Monday 13 January and the council’s Policy and Resources scrutiny committee on Thursday 30 January. Any changes to the draft budget will then be considered by cabinet on Tuesday 11 February, with the final budget to be discussed and approved at full council on Thursday 20 February.