Like many local authorities, the city council is battling against unprecedented pressures of steep increases in its operating costs, increasing demand for services, and below inflation funding from the Government.

Council funding has already decreased by approximately 40% since 2008/9 and in that time many difficult decisions have already been made. Inflationary pressures mean that in 23/24 onwards further difficult decisions have to be taken in order for the council to deliver its key outcomes.

It’s estimated that by 2026/27 this budget gap (income versus planned expenditure) could exceed £5M, which means decisive action is needed.

While we will be able to make some savings through working more efficiently and effectively, these will not balance the books by themselves. Inevitably we will have to reduce or stop some services and many others will be done differently.

Yes, and if we didn’t then the budget gap would be even bigger and we would have to look at stopping even more services than we are currently proposing.

A basic council tax increase of 2.99% - an average of £7.23 a year or an extra 14p a week - has already been agreed for a Band D property to ensure crucial frontline services can continue to be delivered to residents and businesses.

The council has also agreed to continue 100% council tax support for those on the lowest incomes and most affected by the cost of living crisis, one of the few local authorities in England to do so.

Although Council Tax is collected by the city council, we only keep a small proportion (12%) of the overall amount. The largest share goes to Lancashire County Council (73%) with the Police and Crime Commissioner (11%) and Fire Authority (4%) making up the remaining.  If you live in an area with a town or parish council then they will also take a share of the council tax you pay.

Councils are required to keep an appropriate level of money in general reserves to cover unexpected costs.

In 2023/24 we’ll be using some of these reserves to help support the budget, but they can only be used once.

The savings we have to make are recurring, which means they have to be made every year.  Although we will be able to dip into our savings to reduce some of the savings we have to make in one go, we still have to make the savings in future years in any event.

First and foremost, it’s important to recognise that we will continue to deliver a wide range of services to the public and will be focusing on those from which most people benefit.

But unless we cutback in some areas we just won’t be able to afford to fund vital frontline services such as our outstanding local parks, street cleaning, and collection of waste and recycling. We’re not proposing any cuts in these areas, but need to make them elsewhere so they’re not affected.

We are looking at every aspect of our budget to make savings and how we can do things differently to be more efficient, making better use of technology and delivering in partnership with other organisations.

Immediate savings of £2.4million have been proposed for 2023/24, but we’ll need to look at making many more in the future because by 2026 we’re expecting the budget gap to exceed £5M

For future years, other services, and back office functions, will be subject to a comprehensive and rigorous approach to identify and pursue opportunities to improve and reduce costs. 

The council has agreed four key priorities and these are defined by key outcomes, many of which are contributed to by the council’s statutory services such as waste collection, recycling, street cleansing, planning, public protection, revenues and benefits.

We also work with other organisations and partners to achieve the outcomes as the council can’t do everything by itself.

Whilst some of the proposals mean the council will deliver less of some services, it’s also intended that some outcomes are either delivered differently or through our partners and other organisations.

Some of the proposals include:

• Visitor Information Centres

In 2023/24 we’ve had to make the difficult decision to propose the closure of the Visitor Information Centres (VICs) in Lancaster and Morecambe at the end of the 2023 summer season.

The VICs operate at a net cost to the council – by ceasing their physical operation the council will save in the region of £250,000 a year, but this does not mean that our district and all it has to offer will not be promoted.

The council is committed to strongly promoting the district’s outstanding visitor offer, but the way that people access and consume information is changing so the current way we provide visitor information also needs to change.

More and more people are turning to the internet and we will continue to provide information to widest possible audience through every available online channel.

There are a number of other organisations that already do an excellent job of promoting the area. We’ll also be talking to other organisations about where and how else visitor information could be provided, as it doesn’t necessarily need to be in a building owned and run by the council.

• Museums

Another proposal is to look at the operating model of our outstanding museums in Lancaster (City Museum, Maritime Museum and Cottage Museum) to make them run more efficiently. While they will remain open, opening hours could be reduced to focus on peak days.

• The Platform

Original proposals which would have seen the council no longer operating the Platform as a venue from October 2023, saving £150,000 a year, have been revised and it will continue with a full programme until April 2024.

Discussions will take place with external parties who might be interested in taking on the operation of the venue and we will look at ways we can reduce the gap between our subsidy and the income generated.

We have already begun the process of restructuring our senior leadership to cut management costs and a new structure will be in place from April 2023. This will save around £448,000.

We’ve already made the decision to relocate staff from Palatine Hall into Lancaster Town Hall to save costs associated with heat, lighting etc. We’re looking at potentially letting out Palatine Hall, which will also bring in an income.

Fees and charges provide a significant income to the council and they help to recoup costs and fund other services.

Raising fees and charges is one area which have been looked at along with every other service that we provide, with increases made where it is reasonable to do so.

We have to maintain a balance between making sure we can cover our costs and provide an income to the council, but at the same time making sure our services are affordable. 

If prices are too high then footfall would decrease, but if they are too low then we don’t recoup the costs of provision.

Where there are staffing implications relating to specific proposals, the council will work with staff and Trade Unions from an early stage, to try to mitigate compulsory redundancies where possible and consider alternatives to redundancy such as redeployment. Other options will include voluntary redundancy.

Affected staff will be provided with a wide range of support to help them to find new opportunities, either within or outside of the council.

In the meantime, we won’t be recruiting to most vacant posts, unless there’s an urgent need to do so.

The Government allocates specific funding streams which local authorities can bid into and we worked with partners to bid for £50million from the Levelling Up Fund Round 2 to support Eden Project North.

Once delivered, this project will obviously have direct benefits but also help deliver many of the agreed outcomes for the district.

The council has also been successful at bidding for Government funding for a series of decarbonisation projects. These have helped reduce CO2 emissions and also meant we’ve not been as badly hit by energy prices rises as we would have been, reducing the amount we need to save elsewhere.

The council recently awarded eight grants to different projects in the district from a share of £5.3million provided by the UK Shared Prosperity Fund (UKSPF). This fund is allocated by central Government to replace some EU funding that was previously provided. The investment plan we have agreed with Government will ensure that the external funding is allocated in a way that delivers the agreed outcomes for the district.

The council collaborates on a daily basis with a wide range of partners. These include the universities, Lancashire County Council, town and parish Councils, Lancaster Chamber, BIDs, Lancaster and Morecambe College, the arts sector, CVS, voluntary organisations, NHS, police, fire and rescue, etc. By doing so we are working to ensure that as individual organisations we are delivering a sum greater than the parts.

Examples of this include Eden Project, funding of arts and culture, UKSPF investment plan, and funding of the voluntary sector.