Norwich City Council leader: cuts are worse than we feared

The leader of Norwich City Council today warned the impact of government funding cuts on the city will be even worse than first feared, with frontline services and jobs potentially facing the axe.

The city council had already planned to make �3m worth of savings next year, but following yesterday's announcement on how much money the government will give local councils over the next three years, Steve Morphew said the situation could be even more bleak.

Communities secretary Eric Pickles said no council would see its spending power cut by more than 8.9pc over the next two years – but Norwich and Great Yarmouth will both see the cash they have to spend slashed by that amount.

Mr Morphew questioned the figures the government had used to calculate the reduction in grant, but said the worst case scenario could see the council having to find another �3m or �4m on top of the planned �3m.

He said: 'We need to do a lot of number crunching, but on the face of it this seems to be a bit of a shambles. But the opinions on this seem to range from awful to very awful to 'don't even go there'.

'We cannot see how they have arrived at some of the figures. For instance they say this year our formula grant was �14.1m, but we got �15.9m so we don't know what has happened to that money.

'If we add all the bits where money seems to have been missed out then we are looking at reductions of �3m to �4m on top of the �3m we already have to save.

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'We are going to have to go back to them to find out how they have arrived at these figures, but it is worse than we had feared.

'The figures at the lower end would be bad. We could be looking at a point where frontline services would have to be cut, but then it could be even worse. If it goes beyond that then I don't know how we would cope.

'If we do face those kinds of cuts then I don't know how many jobs would have to go or how we would be able to pay for the redundancy costs.'

Mr Morphew, who has announced he will be quitting the council at the elections in May, said, despite Mr Pickles' claims that transition funding, of which City Hall will get �850,000, would help vulnerable authorities, it was poorer areas which had been hardest hit. At Norfolk County Council, officers are also still analysing the figures, but warned it could mean the authority has to find more savings in the next year than originally thought, with its spending power cut by 1.67pc.

Derrick Murphy, council leader, said: 'We know for certain we have lost some �30m in formula grant. We had assumed savings of some �55m for next year to counter loss of grant and the ever increasing demand for our services. At present, our view is that we may need to revise this figure upwards.'

Broadland District Council is facing a 5.6pc reduction. Chief executive Colin Bland said: 'The reduction has been expected and has been part of the council's budget planning for next year. We have been taking costs out over a number of years as opportunities arise and we plan to continue in that vein.

'We are not immune from having to make tough choices, but we do not anticipate any significant service changes or redundancies in the next 18 months or so at the very least.'

John Fuller, leader of South Norfolk Council, which will see a 5.88pc cut in its spending power over the next two years, said: 'Cuts in grant won't necessarily mean cuts on the ground if we are prepared to work in different ways - including with other councils and organisations.'

Great Yarmouth Borough Council is benefiting from �3.3m of transitional funding - cash being handed to councils which are currently particularly dependent on government money, but it will still see its spending power cut by 8.9pc over the next two years.