Aberdeenshire Council is considering a substantial 20% increase in council tax as part of its efforts to address a projected £26 million budget shortfall for the 2024-25 fiscal year.
.This dramatic proposal comes as the local authority grapples with rising costs and growing demand for services, forcing it to contemplate significant cuts to public services or substantial tax increases.
The council has launched an online survey to gauge public opinion on various cost-cutting measures and potential tax increases.
For an average Band D property, a 20% council tax hike would translate to an additional £27.87 per month, generating £33.712 million for the council. This increase would potentially eliminate the need for further budget cuts and even provide extra funds for priority areas.
Council leader Gillian Owen emphasised the severity of the financial situation. He stated:
She said: “The impact from inflation, pay awards, construction costs and the cost-of-living crisis all continue to impact on the council as much as they are impacting household budgets.
“We no longer have enough money to do the things we did five or 10 years ago and we need to change.”
The council’s financial strain is attributed to various factors, including inflation, rising pay awards, increased construction costs, and the ongoing cost-of-living crisis.
If the proposed tax increase is not implemented, the council may be forced to consider drastic measures to balance its budget. These could include:
- Reducing road gritting to morning-only operations
- Scaling back flood protection efforts
- Cutting bus routes
- Temporarily closing underused leisure facilities
- Reducing school staff and potentially closing nurseries
The council’s 2023/24 revenue budget was £711 million, with an additional £115 million allocated for capital expenditure. However, with a growing and aging population of around 262,000 residents, the demand for services continues to outpace available resources.
Local business leaders have yet to comment on the proposed hike, but such an significant tax increase increase would have a potential knock-on impact on the region’s economy. While no official statements have been made, it is anticipated that increased household expenses could lead to reduced consumer spending, potentially affecting local businesses.
The public consultation on the budget proposals will run until November 17, 2024, giving residents the opportunity to voice their opinions on the proposed changes.
The council encourages all residents to participate in the survey, which is available online here and in paper form at local libraries and service points.
As Aberdeenshire Council faces this challenging financial landscape, the coming weeks will be crucial in determining the future of public services and taxation in the region, and the outcome of this consultation will likely have far-reaching implications for both residents and businesses in Aberdeenshire.
