Council tax will be frozen for the fifth year running but fears remain over the borough’s growing deficit.
Launching its budget for 2010/11, Hackney council’s Labour administration claimed last Wednesday that front-line services would not be cut.
But critics say the near-£40m shortfall forecast over the next three years is unsustainable.
Overall spending will increase by £709,000 compared with last year. Schools will gain the most, while Neighbourhoods and Regeneration, responsible for providing housing services and promoting greener living, will lose nearly £2m from its coffers. The figures were revealed in the last full council meeting before May’s council elections.
Hackney’s elected mayor, Jules Pipe, claimed Labour had found £8m in “efficiency savings” this year. He also applauded the announcement that five new youth centres are to be refurbished or rebuilt, with £600,000 going into Dalston and Clapton libraries.
But Hackney’s Conservative group attacked the expected £40m of borrowing needed to balance the books. Together with the Liberal Democrats, they also called for the council’s fortnightly newspaper, Hackney Today, to be scrapped.
It is believed that generous government settlements to the council will be cut if the Conservatives win the upcoming General Election, potentially leading to future spending and service cuts.
Meanwhile, Hackney’s cabinet member for finance, Samantha Lloyd, admitted the extra £500,000 needed per year to plug the hole in the local government pension scheme was “troublesome”.
Your Hackney Post digest of the council’s budget for the next financial year:
- Neighbourhoods and Regeneration will lose £1.8m (total spending: £54.1m)
- Community Services will lose £1.3m (£97.6m)
- Education will gain £2.6m (£157.6m)
- Children and Young Peoples Services will gain £872,000 (£56m)
- Legal and Democratic Services will be totally cut from £72,000 last year.
- Finance and Resources will lose £692,000 (£15.4m)
- Council borrowing is forecast to rise by £12-15m annually over the next three years.
- Local business valuation rates will rise an average of 36.5 per cent.
- An increase of £500,000 per year is needed to cover the deficit in Hackney’s local government pension fund
Additional reporting by Olivia Alabaster, Marion Dakers and Gregor Hunter
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