Government cash needed to stave off Chelmsford council service cuts

Services will have to be cut if the Government does not step in to help Chelmsford’s finances, the city council has said.

The projected budget shortfall for 2023/24 of £4.2million is £2.5m higher than estimated in January. mainly due to inflation fuel and energy costs and car-parking income.

The 2022/23 budget assumed a small increase in car parking income but early monitoring in 2022/23 suggests income could be £500,000 lower than expected.

While the February projection of the budget expected an increase in the rental from teh council-owned High Chelmer shopping centre of £250k per year, the rental income is actually forecast to be £2.3m – around £700,000 lower per year than pre Covid.

Four years ago in July 2018 the council predicted a forecast gap of £1.35m for the following financial year. Last year it predicted a forecast gap of £1.7m.

While in both cases the deficit was closed by the time the budget was set in the following February the council has said unprecedented pressures on its finances means this time it will have to cut services if help is not forthcoming from Whitehall.

Councillor Chris Davidson, cabinet member responsible for finance said at Chelmsford Council full council on July 20: “This year the forecast gap is much larger at £4.2m I still expect to present a balanced budget in January but there is no denying there is a bigger challenge this year than in the average previous years.”

Chelmsford Council relies on 70 per cent of expenditure on income it generates though investment of spare cash, rents on properties it owns, charges for leisure and car parking and other sources such as weddings at Hylands Park.

But as residents feel the cost of living pressures the council expects to see its income fall while seeing its own expenditure rise.

Cllr Davidson said: “Every council is facing these pressures. We have managed our finances carefully – better than many other councils – but we cannot ignore the storm that’s coming.

“The government helped us through the pandemic and we need the government to help again otherwise all councils will have to stop delivering services that residents depend on.”

Piers Meyler

Local Democracy Reporter