The Biggest Budget Cuts in Ealing's History

Financial deal will cause 'real pain' to residents

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Ealing Council is facing a 20% cash cut in its main government grant over the next two years – forcing the council to make the biggest budget cuts in its history.

In the provisional local government settlement announced on Monday 13 December the council found out that it had one of the worst grant settlements in outer London. Ealing is facing a grant reduction of 12.3% next year, which is a bigger cut than the outer London average reduction of 11.3%.

Council Leader, Councillor Julian Bell said: “The scale of cuts being forced on local authorities is unprecedented. We had planned to reduce budgets by 25% over the next three years, yet our main government grant will be slashed by 20% in just two years.

“We took the sensible precaution to plan for these cuts so that we didn’t have to slash and slice indiscriminately but I am in no doubt that this tough financial settlement will cause real pain to our residents.

“We are doing everything possible to protect frontline services by improving efficiency, cutting overheads and finding new and cheaper ways of doing things. But, given the amount of reductions needed and the savage speed at which they are being made, it is inevitable that we will run out of these types of savings and have less time to recoup the money from the changes we are introducing.

“I understand that many people in our community are facing tough times and so we have promised to freeze council tax next year.”

The council has been asked to respond to the government by 17 January 2011 with its comments on the settlement.

The key settlement facts include:
Ealing’s formula (main) grant will reduce in 2011/12 by £21million in cash terms (-12.3%) reducing it to £145million.
Ealing’s formula grant will reduce further in 2012/13 by £13million in cash terms (a reduction of -8.4%).
The number of specific grants that the council receives has been scaled back and those grants that the council will receive have been cut. For example the Early Intervention grant will replace funding from a number of specific grants that have now ended, including Sure Start Centres, Connexions and Early Years Sustainability have been cut by 12% from £17.6million to £15.4million.

The average fall for English councils is – 9.9% in 2011-12 and –7.3% in 2012-13. London, with the exception of the GLA, saw an overall reduction in grant of –11.3% and –7.6% over the two years. By comparison Ealing’s grant will be cut by 12.3% and 8.4% over the same period.

Ealing has not been allocated any additional specific transition grant to help it adjust to the cuts in funding, unlike Tower Hamlets, Newham and Hackney.

Councillor Yvonne Johnson, cabinet member for Finance and Performance, said: “Local government is entering the toughest period in living memory. Although we are doing everything possible to limit the damage of these cuts it is very difficult when our main government grant has been cut by 12.3% next year.

“We have set out fair principles that will guide us in making these very tough decisions and, where needed, consult with people about the most difficult decisions.”

15th December 2010