Thursday 20 November, 2008

At its meeting next Thursday, Guildford Borough Council’s Executive will consider the draft budget for the next financial year. Although the budget will not be finalised until February 2009, a key consideration is the impact of the current financial climate and worldwide ‘Credit Crunch’.

Cllr Tony Rooth, Lead Councillor for Finance and Resources, explains: “Guildford Borough Council is not immune to the budget challenges currently faced by everyone.  Interest rates are predicted to fall to around 1.5 percent next year, which will have a significant impact on the Council’s finances, and we could lose nearly £2 million a year in income.  This year we budgeted for a return on our investments of £4 million and we now have to plan for this falling to £1.8 million next year.  We have to include this shortfall in the development of the Council’s budget for 2009/10.  We have a very good record of providing value for money for council tax payers and have kept our council tax increases below inflation.  Despite this careful financial management and savings in the past three years of £1.8 million, a reduction in our income, coupled with increasing energy costs makes it a very difficult time for us and all other organisations.  We are confident that we can still deliver a balanced budget without a big council tax rise for the borough. But it will require hard work and a willingness from everyone to recognise the need to make some very hard choices”.

Sue Sturgeon, Strategic Director at Guildford Borough Council, adds: ”The Council’s funding comes from a number of sources.  The largest share is from fees and charges for the services we provide and we also receive 15% (£8.6 million) in general grants from the government.  In addition to interest rate changes the overall state of the economy also impacts on a number of our other sources of income, such as car park charges, planning fees and leisure memberships. The Council has a good track record for delivering efficiency improvements and has exceeded government targets over the past three years.  It will be tough, but I am confident that we will deliver a balanced budget in the new year”.