The council plans on using over £10 million of reserves and has identified £10 million of savings to reach a balanced budget in the upcoming financial year as the authority faces ‘significant budget pressures’.

Members of the cabinet for Westmorland and Furness Council have recommended the authority raises council tax by 4.99 per cent and implements an empty homes premium of 100 per cent after one year and 300 per cent after 10 from April.

Westmorland and Furness Council will now decide whether to adopt the proposals at a full council meeting later in the month.

A report prepared for the cabinet on the draft budget proposals states the council has identified savings of £10.34 million for the upcoming financial year which the report says will not impact frontline services.

Cabinet member for finance for Westmorland and Furness Council, councillor Andrew Jarvis said: “The budget for this year contains around £10 million of savings over half of which are permanent.

“We need to go further, much further, it’s now critical we get on with identifying and then delivering the savings that are required to close the financial gaps for the next five years. This means that we need to consider fundamental changes to the way we operate and deliver services.

“Let me emphasise, efficiencies and savings are not about cutting services, our aim is to improve delivery for our communities and residents and doing that in a way that is more efficient and effective for all.”

The authority will also use £10.64 million of reserves in the upcoming financial year which consists of £2.5 from the general reserve and £8.34 million from earmarked reserves.

Cllr Jarvis said: “I am happy this level of reserves is a satisfactory position. Although, this is a higher use of reserves than anticipated,  an improved opening reserve position means the balance at the end of next year will be higher than anticipated.

“We cannot continue to rely on our reserves. We do need to work now to identify savings and efficiencies to make most of the synergies of becoming a unitary council.

“This budget gives us the funding to do this and will ensure that we can deliver a balanced budget for 2025/26 and see a financially stable future.”

A report prepared for the cabinet adds: “Like all local authorities, the council has significant budget pressures that are not fully funded from central government, which means that efficiencies, savings, and different delivery approaches are required to balance the budget and enable investment in priority areas.

“The council has a very pressured funding envelope. Council tax income is the most sustainable and significant source of funding for the council, hence consulting on proposed increases to council tax provide an ability for the council to continue to deliver its essential services.”

Councils across the country are facing ‘unprecedented times’ and the financial resilience of local authorities is under ‘significant pressure’, according to the report prepared for the cabinet meeting.

The report states financial challenges from the pandemic have continued with the increased demand for adult and children’s services as well as reduced collection rates on council tax and business rates.

It adds there is ‘no long-term stability’ around future funding allocations and planned reform of local government funding has been put into ‘abeyance’.

On February 5, the government published the final local government finance settlement for the 2024/25 financial year. This includes a £15 million increase in the Rural Services Delivery Grant, rising to £110 million in 2024-25, in recognition of the additional costs faced by councils serving dispersed populations.

On Tuesday (February 5) Levelling Up Secretary Michael Gove said: “Today, I set out the final Local Government Finance Settlement for 2024-25. This makes available up to £64.7 billion for local authorities in England, an increase in Core Spending Power of up to £4.5 billion, or 7.5% in cash terms, on 2023-24.

“This settlement, and the changes we have made to address concerns raised through the consultation, will provide local authorities with the tools to support their local communities, continue to reform their services for the long-term, and to help communities prepare for the future.”

Members of the cabinet for Westmorland and Furness Council recommended the draft budget proposals on February 13.