County Council claims cuts are still biting despite underspending

Derbyshire County Council claim they are still facing massive cuts to their budget despite recording a planned underspend this year.

In a report discussed by the Council’s Cabinet on Tuesday (26th July) end-of-year figures for the 2015-2016 financial year has shown that they underspent by £32.455m.

A number of departments have seen their budgets slashed in recent years on the back of announced cuts in central Government funding from Westminster with the council saying they are facing further cuts of around £109m over the next five years.

The council have warned though that, while some of the planned underspend has already been approved for use on dealing with pressures across the services, the remaining will be held in earmarked reserves and used by departments to support services which are facing cuts in future years.

Responding to the news, leader of Derbyshire County Council, Councillor Anne Western said: “It’s positive news that we have achieved a planned underspend this year and it reflects the fact that every penny we spend is being scrutinised and used to its best effect.”

“However, our future ability to manage to significant budget reductions required was always reliant on services controlling spending and a proportion of the underspend has already been allocated to help run some services in future years. We’re also planning on using a large amount of our reserves over the next few years.”

“The underspend achieved is against a backdrop of £40m cuts we’ve been forced to make in the same year, with more cuts to come up to at least 2020.”

By 2020-21 the council say they expect the amount they hold in savings, which currently stands at just over £52m, to be reduced to around £14m as most of the general reserves has already been set aside for specific projects or issues.

Councillor Western continued: “Cutting services is the last thing we want to do but as the years go on and the cuts to our budget continue we have no alternative.”

“By 2020 the funding from central government will have been cut to such an extent that the council will be spending a third less on delivering services than it would need to maintain the services it delivered in 2010.”

The Council have also announced they currently hold earmarked reserves of just over £213m with around £50m of that being held on behalf of the county’s schools and the rest being held to meet known or predicted liabilities with the funds only being used for the item for which they have been set aside, such as insurance claims.

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