Council to cut spending

PUBLISHED: 21:57 13 May 2009 | UPDATED: 23:31 15 June 2010

SPENDING at East Devon District Council must be slashed over the coming year, after nearly £2 million of reserves have been used to plug a hole in their finances.

SPENDING at East Devon District Council must be slashed over the coming year, after nearly £2 million of reserves have been used to plug a hole in their finances.But council finance chiefs insist this will not lead to council lay-offs or a cut in front line services.A new group, to cut total council expenditure by three per cent each year up to 2011, the Leader's Service Transformation Group, has been set up following the revelations that the credit crunch has hit council revenues hard.They have had to draw heavily on their £11 million reserves with £1.8 million needed to fund the cost of revenue services including benefits, and a further £2 million needed for 'capital' costs like equipment and buildings.Earlier this year it was reported that the council's income had been heavily hit. Income from planning applications down 40 per cent, a 16 per cent drop in building control income and a fall in land charges by about 30 per cent.To cap it off, the council's investments portfolio has taken a hit - because of low interest rates of just 0.5 per cent council returns are likely to be up to £400,000 less.But EDDC leader Sara Randall Johnson insisted the process was not about cutting services or staff - but trying to find ways of working differently to achieve savings and value for money.In council documents, penned by Diccon Pearse, EDDC's corporate director, it said: "Doing nothing is not a viable alternative...the council does not have the reserves to fund the gap between service costs and income..."Clearly reducing costs and raising additional income mean tough decisions. Residents, visitors and staff will all feel it and there will be a degree of resistance to change."Cllr Moulding, the portfolio holder for economy said last year: "We are always looking at how we can streamline arrangements, from a delivery point of view and a back office point of view and these will continue to be scrutinised.


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