£8m budget gap and 3% Council Tax rise forecast

A budget gap of nearly £8m is projected by Argyll and Bute Council in the next financial year, a report has revealed.

Measures including a 3% increase in council tax have already been proposed to bring the deficit down from over £10m.

But after all those measures, executive director Kirsty Flanagan has projected a mid-range gap of £7.98m in the 2023/24 financial year – with a total budget gap for the next five years of £36.4m.

The best-case scenario would see a budget gap of £5.3m in 2023/24, and the worst-case scenario would see a deficit of £16.2m. The cumulative gap for the next five years would be £25m and £79.79m respectively.

The council will set its budget for the 2023/24 financial year in February.

The report detailing the outlook will go before its policy and resources committee on Thursday.

Ms Flanagan listed measures proposed to balance the budget, including proposed increases to fees and charges between 2% and 4%, a 3% reduction to the Live Argyll management fee and a 3% increase in council tax.

Ms Flanagan continued: “In the mid-range scenario, the revised budget gap estimated over the five-year period 2023/24 to 2027/28 is £36.493m with a gap of £7.980m in 2023/24.

“The budget gap in the best case scenario over the five years is £25.060m with a gap of £5.367m in 2023/24 and in the worst case scenario, the budget gap over the five years is £79.798m with a gap of £16.231m in 2023/24.”

Ms Flanagan also outlined measures which may have to be taken in relation to the area’s health and social care partnership, and to the Live Argyll management fee.

She added: “There will be a political decision to be made as to the future allocation to the health and social care partnership.

“At this stage a 3% reduction to the Live Argyll Management fee has been included within the estimates.

“At the 2022/23 budget setting meeting in February 2022 it was agreed to defer the proposed three percent reduction to the Live Argyll management fee until 2023/24 subject to any future budget decisions.

“It was agreed that management would engage in early discussions with Live Argyll in relation to future approach to support effective longer term financial planning.”

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