Isle of Man News - POSTED Mon 15-10-2018

Council Leader warns of 'challenging' times ahead

by TH

Council Leader warns of 'challenging' times ahead

The leader of Douglas Borough Council says there are 'challenging budgetary times ahead' for the Island’s local authorities.

David Christian says it’s because of the 'relentless rise' in costs being imposed by central government.

The council is beginning its budget process to determine the rates for the next financial year.

He says: "The council’s budgets have long been under severe pressure.

"The next financial year, however, will see that pressure mounting, as the Island’s local authorities will be required to pay more in employers’ National Insurance contributions, following a Treasury directive that will end the contracting-out of the State Second Pension in April 2019.

"For Douglas, this measure represents an added rate burden of some £200,000. That alone would add an extra 6.58p on to the town rate.

"Earlier this year the council made representations to Treasury, requesting that local authorities be recompensed to counter the financial impact this new legislation would have on their budgets. 

"Regrettably, despite the council’s protestations, no financial support from government has been forthcoming and so local authorities are faced with having to shoulder another government-imposed cost over which they have no control.

"There is also the impact of a pay award settlement imposed on local authorities by the Public Service Commission.

"When Douglas set its rate levy for this current financial year it provided for an anticipated two per cent growth in wages and salaries for the council’s workforce.

"There is now, however, a very real and worrying prospect that that provision will prove to be inadequate, as local authorities will have to fund a backdated pay award very late in the financial year which, inevitably, will have a knock-on effect on 2019-2020 rates.

"Once again, local authorities have had no say in this latest call on their already overstretched finances as the commission made its ruling without any consultation whatsoever with those forced to comply with yet another excessive demand from central government." 

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