An introduction to this year’s budget

Responding to the coronavirus (COVID-19) pandemic has placed a significant strain on the council’s budget during 2020-21. However, as a result of implementing the COVID-19 Financial Recovery Strategy earlier in the year, we are confident we can manage the financial pressures the pandemic has created.

Cllr Sir Steve Houghton CBE, Leader of Barnsley Council, said: “Over the last 12 months, the council and all of our partners have done a fantastic job in supporting the borough.

“We've set out our budget proposals for the coming financial year. The good news is the council’s finances are in a very strong position, despite ten years of austerity. Through strong and effective management, particularly financial management, we’re in a good position as any council can be, to cope with the pandemic and the issues it throws at us.

“We have to make difficult decisions about how we deliver our services, and without further support from the government, this puts us in a challenging position. I want to reassure you that our priority remains to keep critical services running for our residents while protecting the most vulnerable in our society.

“We're continuously looking at the council's financial position as the data is frequently changing, but it's clear that this is a significant challenge for us, and it will have an immediate impact, as well as in years to come.

“We all want Barnsley to build back better and help communities move on from the pandemic. Barnsley’s 2030 vision and ambitions, which will launch later in the year, will focus on the next nine years to make the borough a place of possibilities.”

Where does the council’s money come from?

Every year, we set a budget for the coming financial year (April to March). The budget sets out how we’ll spend our money to provide a range of services to meet the needs of our residents - including schools, social care, planning, public health, bin collections and road maintenance.

We call this the ‘revenue budget’ and it’s used to pay for the day-to-day running costs of delivering our services - such as staffing, maintaining public buildings and general service running costs.

The ‘net’ revenue budget available to spend on services for 2021-2022 is £560 million. This is funded from a combination of central (core) government grants, business rates and Council Tax. This is the amount of money available after contributions from our other income have been accounted for - such as council house rents, grant income received for specific purposes, client contributions and fees and charges.

Has the 2021-2022 budget been cut?

Yes, the budget does balance. Providing we deliver our efficiency plans, manage demand for services effectively, receive government funding as expected and remain flexible and vigilant, we’re in a relatively stable financial position for 2021-2022.

However, like we have mentioned, there is a great deal of financial uncertainty over the next few years and beyond. We’re preparing as well as we can for these uncertainties and the different scenarios we may face. We’ve updated our three-year financial plan taking us up to 2023-2024. However, the position beyond 2021–2022 is very uncertain and is constantly changing. Our forecasts are based on many assumptions, so it is critical that we remain vigilant, flexible and be prepared for all eventualities.

Beyond the next financial year, we’re currently estimating a £7.5 million shortfall that will need to be met from budget savings. However, this remains extremely uncertain until the government confirms what funding will be available. Regardless of uncertainty, Our Be Even Better strategy seeks to address any shortfall.

How will the proposed 2021-2022 budget be spent?

The budget is allocated to help us make Barnsley an even better place to live, work and visit. All decisions on how to spend and allocate the budget are made with our residents in mind - making sure the work we do makes a real difference to you and your family, while also driving towards a sustainable future council.

The budget will be spent across a number of front-line services.

In addition, the council is spending over £400 million of potential new capital investments has been identified over the next three to five years. Key parts of the proposals are broken down into revenue spend (for example day-to-day spending) and capital spend (for example: purchase or improvement of fixed assets). 
A summary list of investment proposals is provided below with a full list available on the council's website.

Further information can be found in your guide to the budget and Council Tax.

Revenue spending (for example day-to-day spending)

• £110 million Adults and Communities
• £130 million Children’s Services
• £99 million Place
• £70 million Housing Revenue Account
• £12 million Public Health
• £128 million Core Services
• £11 million Corporate

Capital spending (for example spending on fixed assets like roads or buildings)

Find out more about the key areas of investment on page 87 of the Full Council papers for Thursday 25 February 2021.

Where does money for the capital programme come from?

Capital funds are separate from our revenue budget and cannot be used to fund running costs. Capital funding can come from a number of sources, including:

• capital receipts from selling off assets for example land
• specific grants to pay for specific schemes or initiatives
• borrowing for example a loan
• match funding/contribution from external parties
• money set aside from reserves (underspends) from the revenue budget.

We’ll continue our drive to invest in the borough's future with a proposed £400 million of new capital investment to be spent over the next three to five years through the ongoing roll-out of our capital investment programme.

Is my Council Tax going to increase?

Despite efforts to bridge the gap in funding, due to the year-on-year cuts from central government, growing demand on our services and inflation, the council’s component of your overall Council Tax bill will increase by 2.9% for 2021-2022.

This includes:

• 1.4% increase to help fund general services,
• 1.5% increase relating to the government’s Adult Social Care precept to support elderly and vulnerable residents.

We’d like to reassure our residents that this decision has not been taken lightly. We know that money is tight, and a number of options have been explored to prevent our residents from having to dig even deeper into their pockets and to minimise the impact it has on them.

It’s also important to remember that Council Tax only contributes towards 19%, a small proportion of the total amount of money we’ll spend delivering our services.

Does this proposed increase include Fire and Police services?

No, it doesn’t. The 2.9% increase is just for the part of the Council Tax bill that’s paid to us for the services we deliver. We don’t pay for the Police and Fire Service out of our budget, they set their own Council Tax precept for the services they provide. This precept is paid over to the Police and Fire Authorities respectively.

If you live in an area that has a Parish Council, you may also have to pay an additional amount that is set by the Parish Council.

What will the proposed 2.9% Council Tax increase mean to me and my family?

The financial impact of this proposed increase will depend on the housing band in which you live. The table below provides the total weekly and annual increase based on your house band:

*Subject to approval

Why are you proposing to increase Council Tax?

If you live in an area that has a Parish Council, you may also have to pay an additional amount set by them which we collect on behalf of the individual parish precepts.

Find out more about Council Tax bands. 

We would have to cut vital services if we didn’t increase Council Tax as other forms of funding are simply not there. The government have again allowed councils to raise an Adult Social Care precept of up to 3%. Therefore, the council’s component of Council Tax will increase by 2.9%. This breaks down to a 1.4% increase to help fund general services, such as bin collections, roads and our Area Councils, and a further 1.5% increase relating to the government’s Adult Social Care precept to support elderly and vulnerable residents.

It’s important to look at the bigger picture; the Council Tax income we receive only contributes towards around 19% of the overall gross cost of delivering our services, and core statutory services are underfunded. Our spend, per head of the population, for both adults and Children’s Social Care, is one of the lowest when compared with our statistical neighbours.

The increase made to Council Tax has not been made lightly and we’ve considered many options to keep the Council Tax increase as low as possible. However, unfortunately, we have not had much choice without having to make further cuts to the services we all need.

How will my Council Tax be spent?

The general Council Tax contribution helps meet the running costs of all the services we provide in the borough - such as schools, social care, maintaining roads, waste collection and recycling, libraries and health protection.

The government precept contribution is ring-fenced specifically to support the rising costs of Adult Social Care to support elderly and vulnerable residents.

The Council Tax you pay each year is used to help deliver the services that you need.

You can view the full budget details in our Full Council reports or your guide to the budget and Council Tax.

Why do I have to pay for Adult Social Care as part of my Council Tax?

The Adult Social Care precept was introduced by the government in 2017-18 to allow councils that provide social care to raise additional funds to spend on Adult Social Care. The number of older people living in Barnsley continues to grow - based on the 2018 population projections, the over 65 population in Barnsley is estimated to be 49,914 people in 2021, rising to 50,959 people in 2022 and 52,005 people in 2023. This puts a lot of pressure and demand on our social care services bringing with it a huge cost and impact on our budget.

In 2021-2022, the government have allowed councils to charge an Adult Social Care precept of up to 3%. Because of the ongoing pressures within this service, the difficult decision has been taken to charge 1.5%.

You and your family members may not need to use our Adult Social Care services at the moment – but you may one day. It’s similar to paying National Insurance to support the NHS.

Why do I have to pay for services I don’t use?

Just like you may not feel it’s up to you to pay towards Adult Social Care services, you may feel the same about other services that you don’t need or use. Lots of the services we provide are used to benefit everyone, and without them the borough would grind to a halt - such as bin collections, maintaining roads and public health. Some services are used by fewer residents depending on personal circumstances - such as Children’s Social Care, home support for the elderly and special educational needs.

Council Tax is a bit like income tax – it’s not a charge for individual services and it would be impossible to tailor-make every household's bill based on personal circumstances. Another thing to remember is that we never know what’s going to happen in the future and what help or support we may need.

If you’re proposing to increase Council Tax, why can’t you deliver more services instead of asking us to do more for ourselves?

While there are still a number of savings that need to be made, the increase in Council Tax will help protect and limit the cuts we need to make to the vital services we deliver. The increase in Council Tax reflects the reduction in funding we receive and cuts to be made. Regardless of the increase in Council Tax, we still need to make £7 million in savings during 2021-2022.

We’re working tirelessly to make our resources go further and lead to sustainable outcomes so we can be prepared for the further challenges we face - financially and in terms of the growing pressures and demands on our services. We’re trying to do more with less and focus on those areas with the biggest impact in the long run.

Instead of proposing to increase Council Tax, why don’t you use money from the reserves?

In household terms, reserves are similar to the money people save for one-off events or if unexpected things were to happen - such as your car breaking down, or if you want to spend money on a large purchase like a holiday or home improvements.

By law, all councils are required to hold a minimum reserve called a minimum working balance (MWB) which is calculated by determining the risks we may face. The MWB is intended to set aside enough resources to provide a backup or contingency in the event that any such risks become a reality. Our MWB for 2021-2022 currently stands at £20 million. Although it is expected that some of this balance will be required to fund the costs associated with COVID-19. This amount has also been agreed by our external auditors as being an appropriate level to help the council deal with any future potential risks that might occur.

Other available reserves are derived from selling assets (called capital receipts) or year-end underspends which generate one-off pots of money. These reserves are not used to meet any short falls in the budget – they’re to be utilised for one-off capital investment or priority investment schemes. Once these reserves have gone, they’ve gone and take time to replenish, so it’s really important that reserves are prioritised to either provide a return on our investment or to contribute towards supporting a service to achieve a sustainable position in the future.

How do you work out how much you pay your staff?

Our pay policy sets out the arrangements for salary and related allowances paid to employees. This is refreshed at the start of each financial year and will be updated once approved at Full Council.

It details how salary levels are determined, the method for pay progression and the payment of allowances.

You can also find details of the salaries and job titles of senior employees whose salary is more than £50,000 on the website.