Council funding increase labelled 'token gesture' as council tax set to rise

Leader Ian Brookfield dismissed the increase as a "token gesture" and said the extra cash will go nowhere near to making up for more than £200 million of cuts to its budget since 2010.

Bosses at the Labour-run authority say they still need to save £15.5 million in 2021/2022, and another £4.5m by 2024 in order to balance the books. Leaders have previously said the authority is facing the most financially challenging period in its history.

They insist it is for this reason there is a continuing need to increase council tax to help ensure the authority can deliver a balanced budget. The authority said uncertainty about funding levels beyond next year made financial planning difficult.

Wolverhampton Council is expected to receive an extra £14.5m from the Government in a further signal Mr Johnson's is keen to loosen the purse strings and make a clean break from the era of austerity.

However, ministers have also reined in the ability of councils to hike council tax. They can now only raise it by almost four per cent a year, before triggering a referendum, rather than five per cent.

The city council is planning for the highest increase possible, 3.99 per cent, which includes two per cent for social care, in its budget for 2020/21 set to be signed off this week.

Councillor Brookfield: "Under their party we have faced a decade of austerity and rising cost pressures have meant that our council has been forced to make budget cuts of £235 million.

“What we really need is our funding to be restored to the levels we enjoyed ten years ago. This year’s derisory amount is nowhere near that figure.

“Furthermore, we are forecasting a budget deficit of £15.5 million by 2021/2022, rising to £20 million over the medium term to 2023/2024. Put simply, the council's budget remains a red risk and uncertainties over funding beyond 2020/2021 means this continues to be the most challenging financial position in the council’s history - all thanks to the Tories”.

Councillor Wendy Thompson, Conservative leader in the city, said: “Local authorities play a vital role in our communities, providing the crucial local services that people rely on every day. I am delighted that the Conservative Government has confirmed Wolverhampton Council will have additional funding this year, which will help to make much-needed positive changes in our city.

“The Government was elected on a promise to level up local communities across the whole country, and with this funding increase we can start to do exactly that here in Wolverhampton, ensuring everyone lives in a community they can be proud of.”