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Budget 2014-15

January 3, 2014

The implications of the Government’s austerity programme, which is seeing unprecedented cuts to local government, are now starting to be clear. In 2012 we consulted on a plan which identified the need for £90m of cuts from the council’s budget over a three year period. Since then, additional Government cuts have increased that to £108 million.

Cuts have an obvious and painful impact on everyone, and particularly the most vulnerable in our communities. They result in job losses, services being withdrawn and damage economic confidence. It is therefore regrettable that the Government, rather than easing the pain of cuts as the economy starts to recover, seems determined to press ahead with yet more deep cuts for councils. Many of the cuts they have already announced have yet to be implemented, and the consequences of the further cuts they have planned will, no doubt about it, be very grave.

Newcastle’s Cabinet will continue to make the robust case to Government that continued cuts of this scale are having a hugely negative impact on our city, and are damaging and counterproductive. We will stand alongside our regional partners, Core Cities and the Local Government Association in making that case. We have been clear from the start that we will be honest with staff and residents alike and will continue with that approach. We will also continue to apply the principles identified by the Fairness Commission to our decision-making.

With the Government cutting our budgets year on year it would be easy to feel powerless, that Newcastle is a place that has things done to it rather than a place that does things. Instead, our long term approach to the budget is about taking control, thinking about how the council might look in 2016 and how we could continue to provide services with the resources we will have. The council has four clear priorities, for which my colleagues and I are politically accountable, and these will guide us and help focus services on the outcomes we want to achieve.

Alongside setting a balanced budget, which the council must legally do each year, we are straining every sinew to save jobs and keep vital public services in the city. Residents, community groups and partners have come forward over the last year and as a result of their cooperation and commitment we have managed to save libraries, respite centres and other valuable services. I am extremely proud of the civic-minded way in which people in Newcastle are rallying, at such a difficult time, to play their part. And in recognition of the cost of living crisis that many face, we are proposing to freeze council tax for the fourth year running.

Although it may feel like a permanent fixture, austerity will pass. It’s therefore important that we take big decisions now about the longer term future of the city. I signed an ambitious City Deal with Government which will unlock £92 million of investment. It could ultimately be worth up to £1 billion in total and bring up to 13,000 jobs to the city. The council is investing at Central Station, in the historic Stephenson Quarter and the first building is also going up on site at Science Central, the former brewery site next to St James’ Park. We have secured £6 million of Government funding to improve broadband connectivity across the city, and £5.6 million for cycling connectivity. We are investing £25 million in our future homes fund which will help deliver affordable homes. Work has also started on the £265 million redevelopment in Scotswood which will create a new 1,800-home sustainable neighbourhood over the next 15-20 years, and have just been awarded a further £4.5 million to help young unemployed people to find work. These major initiatives are our statement of confidence in the future and, together,

make the biggest programme of investment in the city for decades. They are a counterpoint to the misery of continued cuts to the revenue budget, a visible sign of the council’s commitment to the city and its people.

This budget, at a time of reducing resources and increasing demand, therefore seeks to strike the right balance between revenue cuts and capital investment, between services for people in crisis now and services which prevent people from reaching crisis point, between managing public sector job losses and creating employment opportunities in other sectors. It represents fair choices for tough times, and reminds us that however tough it might be now we have to remember that better times will lie ahead.

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