Tendring District Council (TDC) is able to “weather the storm” short-term – and is “in a strong position” to respond to the longer-term economic situation, a meeting heard last week.
A financial performance report discussed by the Council’s Cabinet set out the pressures faced by the council due to rising inflation and energy costs.
Rising energy costs
Carlo Guglielmi, TDC Deputy Leader and Cabinet Member for Finance, said every local authority across the country would be dealing with similar matters.
“Thanks to our very careful financial management we are able to weather the storm in the short term, and we’re in a strong position to respond in the medium-term; this means we can take time to react and make well-informed decisions,” Cllr Guglielmi said.
“Although the future looks difficult, we can find sustainable answers. All officers have been asked to look at spending and reflect upon priorities, and we are looking to protect frontline services as much as possible.”
The report set out some of the cost pressures faced by TDC, including an estimated rise in energy costs of more than £250,000, contract inflations, reduced government funding and employee inflation costs.
The Cabinet also committed £859,200 of funding to some ongoing projects, including £600,000 towards the Starlings redevelopment project, replacement recycling boxes and bins, and to extend some temporary staffing posts to ensure ongoing work continued.
Cllr Guglielmi also highlighted that while interest rate rises were a “double-edged sword”, it did mean an increased return on the council’s investments which could be as much as half-a-million pounds.
“This is a completely abnormal situation, caused by various things, but we are dealing with what is in front of us,” he added.
Ian Davidson, TDC Chief Executive, told the meeting there was “no fat in our budgets” as some local government press reports had suggested.
“The financial position is concerning and there will be difficult decisions to make,” he said.”
Cllr Guglielmi and Davidson both praised the work of the authority’s Assistant Director for Finance, including the team’s flexible approach to budget setting which allowed a considered response to the economic situation and put TDC in such a good place to react.
Cabinet also heard that TDC has £6 million invested in Thurrock Council – which has had commissioners take over after concerns over its levels of debt. The three separate short-term deals, re-payable over the next five months, are in accordance with the council’s Treasury Management Plan, and the meeting was told that a written guarantee of TDC’s investment had been received – and that there were no concerns that the authority would not meet its obligations to Tendring.
Cllr Guglielmi added: “Investing, lending and dealing with other local authorities is a common and long-established practice, which auditors are well aware of.”