Service cuts or higher Council Tax?

This was the gloomy news from the cabinet meeting.

Director of resources Dr Pav Ramewal says Rother has been unfairly treated by the Government in its grant settlement (see story on right). Strong representations have been made to the Office of the Deputy Prime Minister.

The budget has been prepared in line with Rother's medium-term budget strategy of increasing it resource base annually, through phased council tax increases to secure and maintain a sound financial future.

It has been prepared on a standstill basis.

Commenting on the Government's national grant settlement, Dr Ramewal says: "Overall, it is nationally recognised that this is a very poor settlement for local government."

He says: "For Rother, the Government figures suggest an increase of 2.9 per cent on a like-for-like basis taking into account the transfer of benefit funding to the Department of Work and Pensions. Initial analysis however, suggests that the council may be significantly worse off under this new arrangement.

"A 34,000 increase represents a 0.5 per cent increase in cash for the council. This compares to an increase of 143,000 (or 2.2 per cent) the council could rightly expect under the floors mechanism. Representations have therefore been made to the Office of the Deputy Prime Minister that the Council has been unfairly treated with this settlement.

"It would appear that a number of district councils nationally have feared a similar outcome.

"Nationally, the Treasury has assumed an average increase in Council Tax levels for 2004/05 of seven per cent. If we were to spend at the Government's assumed level.....the council would need to raise 5.6m locally, which would equate to a Band "D" Council Tax charge of 151.