Council tax could be raised again to help cover a local authority’s increasing costs as it warned it could soon run out of reserves.

The warning comes ahead of East Sussex County Council's cabinet considering this year's budget next week before it goes to full council.

A report on the financial plan sets out a balanced budget which proposes no new cuts in 2024/25.

But this would rely on using £14 million of the council’s limited reserves to meet a shortfall for the year ahead.

The report warns that the deficit is expected to grow to £45 million in 25/26 and £61 million in 26/27, with the use of reserves no longer an option.

As well as using reserves, cabinet members will be asked to recommend a £538 million net draft budget to full council which could include a council tax increase of 4.99 per cent, needed to cover the “increase in costs and demand for the wide range of services provided to residents”.

Council tax was also raised in the budget for 2023/24 by 4.99 per cent.

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The council said the increase, which includes the additional two per cent for adult social care allowed by government, would equal an additional £1.62 per week on a Band D property.

A council spokesman said: “Despite extensive lobbying by the county council, the Government’s Autumn Budget Statement contained no new funding for local authorities to meet increasing pressures but did include updates which will further increase costs. 

“The cost of providing vital council services has risen sharply across the country especially for children and adults’ social care, where the impact of Covid, complexity of need, and cost of living pressures, has driven up demand. Inflation, market pressures and high profit margins by some providers in children’s services have also significantly increased costs.“

The county council has added £50 million to its annual spending for East Sussex in the budget proposed for 2024/25 to help meet these pressures, though it said it is not being funded to match the increased spending. 

Referring to the use of reserves for 2024/25, the report states: “Previous robust and prudent management means we have this final safety net to see us through the next 12 months, but this is not a sustainable way to balance the budget.”

The full cabinet report is available at https://democracy.eastsussex.gov.uk/ieListDocuments.aspx?CId=133&MId=5524

A final decision on the 2024/25 budget will be made by full council on Tuesday, February 6.