Sheffield residents set to be hit with council tax increase as authority faces £98 million black hole from Covid

Taxpayers will be hit with another rise in council tax in the coming financial year as Sheffield Council faces a budget gap of £98 million.

By Molly Williams, Local Democracy Reporter
Friday, 17th December 2021, 3:24 pm
Updated Friday, 17th December 2021, 4:29 pm

Officers recently warned that the budget may not be balanced this year as the council continues to be in a challenging financial position following enormous demands placed on services during the coronavirus pandemic and more than a decade of Government cuts.

It also said there is no extra funding from Government to tackle the ongoing impact of Covid and anything it does get for the next financial year is unlikely to be enough.

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Sheffield residents face council tax rise.

How much will council tax increase by in 2022/23?

The total funding gap before savings stands at £98 million. Savings of £35.7 million were declared by the council, making the remaining gap £62.3 million.

Part of its plan to balance the budget is to increase council tax, in line with the Government’s spending review, by 1.99 percent with an additional one per cent precept for adult social care.

This is expected to raise an extra £6.711 million.

It follows a rise of 1.99 percent with a three per cent precept for adult social care last year.

Why is council tax rising again in Sheffield?

Councillor Cate McDonald, executive member for finance and resources, said since 2010/11, Sheffield has had its spending power reduced by £215 million, 31 per cent, and it is struggling to recover from the financial impacts of Covid with not enough support from Government.

As a result, the burden has been put on hard-working taxpayers and Coun McDonald urged the Government to do more to stop this from happening.

She said: “Since the pandemic began we have faced challenges like we have never seen before and it’s not over because we are now dealing with the financial consequences all the while still meeting the ongoing needs of our residents.

“While we are met with one of the toughest budget gaps in recent years, due to Government cuts and the pressures of Covid, we as a council have managed our finances prudently and will ensure we balance the budget, continue to provide much needed services to residents and put Sheffield first.”

What other measures is Sheffield Council taking to balance its budget?

The council said another key measure to help balance its budget is to make more staff cuts through voluntary early retirement and voluntary severance.

For the current budget, the council said it would make 300 redundancies across its workforce equating to around 240 full-time equivalent jobs. Around 100 of these were expected to be replaced by apprenticeship roles.

How to have your say on Sheffield Council’s budget

The council opened its consultation on the budget this week.

Coun McDonald said: “We are prioritising the vulnerable and remain ambitious for the city and the aims of our One Year Plan but acknowledge that some difficult choices will have to be made. We want local people to tell us what they think through the consultation and help us shape these decisions.”