Dire warning over East Sussex funding produced in budget summary

DURING the next four years East Sussex County Council must make up for a predicted £30m budget shortfall, a summary of the council's finances shows.

The Financial Strategy and Budget Summary envisages a loss of around £7.8m each year until 2012/13, with £7.375m needing to be saved this year.

This stark figure is explained by the fact that the council has received an increased grant from central Government of around £3m but faces a £19.4m rise in service costs. The rise is due both to inflation and also to increased demand placed on adult social care, according to the report.

Deputy leader of the council Tony Reid said: "The recession is biting hard so it's even more important that we spend every pound of our budget wisely and continue to work with our local communities to deliver efficient, affordable, high-quality services for all."

The budget summary warns a complete overhaul of how the council funds its services may be necessary.

It states: "Overall it is difficult to see how the service offered across the council in its current form can be sustainable over the medium term.

"As always efficiency savings have a part to play, but the likely scale of the mismatch between resources, affordability and the current service offer becomes increasingly more difficult over the medium term."

These estimations are made based on current and predicted incomes and expenditures, and do not include money provided by central Government for capital building projects.

The Government has indicated that over the next five years funding will be provided that will allow the largest capital spending programme East Sussex County Council has ever produced.

The council is planning to spend £922m, of which £725m will come from Government grants and external organisations. During this financial year a gross capital expenditure of £100m has been planned.

This will be spread between the rebuilding of primary and secondary schools, the Bexhill Hastings Link Road and refurbishment of adult care homes in Eastbourne and Seaford.

It will also go to improved library services and ongoing maintenance projects. Cllr Reid said: "The capital programme is a fantastic opportunity for us to improve services and help to breathe life into the local economy through to 2013 and beyond. However, a big slice of the building programme is reliant on Government grants, so we must be aware of the risks during these turbulent economic times."