A 3 per cent tax rise to cover adult social care will still not be enough to “address the crisis” crippling the sector, Merton’s borough leader warned.
Merton Council voted to raise council tax by 3 per cent in order to fund adult social care, with further raises planned for the future.
The agreement was reached at the council’s annual budget setting meeting on Wednesday, March 1, just one year after the ruling Labour group refused a 1.7 per cent precept to fund the service.
March 2016: Peter Walker resigns from Merton Council as cuts to adult social care are passed in the budget
The Merton element of the council tax will remain frozen next year, but a 3 per cent rise has been projected for both 2017/18 and 2018/19.
In December last year, the Government’s Communities Secretary, Sajid Javid, announced local authorities could raise council tax by six per cent over the next two years to help cover the cost of adult social care amid funding cuts.
The year before, local authorities had been given the power to raise council tax by 2 per cent to fund the service.
Communities Secretary Sajid Javid announced the changes in December
For a Band D property in Merton, the 3 per cent rise next year would mean an increase from £1,102.25 to £1,135.31.
The budget report also predicts a rise of 4 per cent in both 2019/20 and 2020/21, with both the adult social care precept and the Merton element rising by 2 per cent each year.
Merton Council overspent its adult social care budget for this year by £8.3 million, and promised an extra £9 million for the sector next year.
Leader of the council, Councillor Stephen Alambritis, said: “This year’s budget is full of help and hope for our residents. Help and hope for all parts of this great borough of ours.
“In Merton, we think it is important to look after older and disabled residents.
“So, despite the Government’s cuts to our funding, we have agreed to spend over £9 million extra on adult social care in the coming year with further investment in the following years.”
He added: “This will still not be enough to address the crisis in adult social care. We will be lobbying the Government hard to face up to their responsibility to properly fund the adult social care system.”
Last year, the Merton Labour Group stuck fast to its manifesto pledge of freezing council tax levels, despite the fact that a 1.7 per cent raise would not have cost residents any more due to the ending of the Olympic precept, and instead implemented £5 million of cuts to the adult social care sector.
This decision led to the resignation of Councillor Peter Walker and eventual suspension of Councillor Jeff Hanna for his continued criticism of the cuts, and caused the Merton CCG to threaten to withhold £2 million of funding from the council unless the precept was raised this year.
Feb 16: Outspoken Labour Councillor Jeff Hanna 'indefinitely suspended' from Merton's Labour group
A Merton Council consultation into whether residents would support a rise found 77 per cent of respondents in favour.
The cuts sparked protest
Despite supporting the 3 per cent rise in the budget, Cllr Alambritis is facing a formal investigation for using council resources to send out his own consultation at the same time as the official one, which urged residents to vote against any rise in council tax.
Nov 22: Merton residents vote to raise council tax to protect adult social care services
During Wednesday’s budget meeting, the Labour group was heavily criticised by the Conservative opposition, particularly when it was confirmed that none of the £1.3 million Savings Mitigation Fund, set up to offset the impact of last year’s cuts to adult social care, had been spent.
Instead, money will be used to try to lessen the overspend in the council’s budget this year.
Leader of the Merton Conservatives, Councillor Oonagh Moulton, said her members would be lobbying Government to try to get better funding for adult social care in Merton.
However, she added: “While we do need a better Government settlement, this does not explain the dire state of Merton Council’s finances.
“Uncertainty around adult social care has been exacerbated by Labour’s poor financial management. Many of the problems they face today are of their own making.
“The council’s finances are on a cliff edge. There is a serious risk that this authority could go bust in the next year or two.”
Merton Council is predicted to overspend its total budget by more than £6 million this year. By the financial year 2020/21, a budget gap of over £18 million is predicted.
Cabinet member for adult social care, Councillor Tobin Byers, said: “To say it’s been a difficult year would be an understatement.
“It was around month two that the overspend in adult social care became apparent, and since then we have been doing all we can to bring it down.
“The system is at tipping point now, and anything we do will do nothing but tinker at the edges.”
The budget was passed by 39 votes in favour and zero against. All Conservative councillors, and the Liberal Democrat Councillor Mary-Jane Jeanes, abstained.
What do you think? Email letters@wimbledonguardian.co.uk
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