Are Wider Financial Markets Impacting Local Council Budgets?
Are Wider Financial Markets Impacting Local
By their very nature, financial markets are liable to fluctuate – that’s an inescapable truth both those who work within the financial sector and those who trade on the changes within it are more than aware of. Due to the ongoing long-term political uncertainty in Britain – with both constantly unpredictable Brexit negotiations and an increasingly weak governing majority affording little confidence to those in charge of our currency – it’s beginning to have an effect on how much money the country has to spend on a local level, too.
One such example, in North Yorkshire, has prompted the county council to open budget consultations with their constituents on how to best allocate their finances in the coming years. With a fall in available spending due to fall by 34% by the end of the decade, that hasn’t stopped the demand for council services increasing during the same period, highlighting the discrepancy in how much funding in now being provided by central government compared to the past.
Anyone even vaguely familiar with the news and domestic politics will be more than familiar with the rise in ‘cuts’ and austerity measures being put in place to make the most of what money there is available, with a conversation now required on what should be prioritised – meaning that some services will suffer as a result. With a focus on protecting the vulnerable whilst still making savings, the budget shortfall of almost £200 million (by 2021-22) has been partially met, with £157 million having been saved through cuts made to date. While that may seem positive, there is still a £40 million funding gap that needs to be addressed, which is why these consultations have been called in to place.
Frontline services such as health, fire and policing will all be up for discussion, as will education, business, transport and operational costs. With 48% of the budget coming from council tax already – topped up by 15% from allocated central government funds – it’s only right that the local residents are given some say on where their money is going, especially if it’s going to directly affect the services being made available to them.
Far from an isolated incident, this will become an increasingly regular occurrence across the country whilst the financial future of the country remains as uncertain as it does presently, with the markets unlikely to react kindly to extended periods of constant change and widespread inaction.