Medium Term Financial Plan (MTFP)

The Council is facing unavoidable financial pressure. This is because of less public funding between 2010 and 2019. During this time the Council’s budget was reduced by £46m in real terms, a 36% reduction.

The current economic climate has also made the financial position worse . The cost of living is increasing, and income deprivation and poverty rising.  It is a tough time for everyone including the Council.

There is increased demand for services, (particularly children’s social care), high inflation, and rising interest rates.

Over two thirds of our budget is spent on adult and children’s social care provision, caring for our most vulnerable residents and children.

The rise in inflation and interest rates directly impacts on our adult care contracts which increased by 15.6% over the last year. Since the pandemic there has been a continued and significant rise in the demand for children’s care services.

We are seeing more vulnerable children with increasingly complex needs requiring help and support. There has been a 33% increase in children in our care since pre pandemic levels.

These are our largest budgets, and we have a statutory duty to provide the services, but they only touch 4% of our population.

Darlington has the second lowest Council Tax in the North East. As such we raise lower income from Council Tax compared to other local councils.

Darlington also has a “low tax base” this means we have a high proportion (79%) of properties in Band A-C. This, along with the council tax level, means we collect much less council tax than some other more affluent areas.

If Darlington’s Band D council tax level was the same as the average England Band D level, we would raise an extra £8.7m per year.  This highlights the disparity in how local government is funded.

In the past the Council has met the challenges faced head on. Value for money service delivery, shared services, economic growth, and strong financial management and has used built up reserves to continue to provide vital services for the people of Darlington.

The extra demands and inflationary increases are putting an unprecedented pressure on affordability and our reserves will be gone by the end of 2025/26.

To protect services as far as possible and push back the impending cliff edge, all budgets have been reviewed and challenged.

Savings of £4m have been achieved through savings and efficiencies which do not affect front line service delivery.  Also, a proposed Council Tax increase of 2.99%, and a 2% Social Care precept to help fund adult social care has been made. This will create £1.869m and £1.250m from each to help continue to provide vital services. 

To help our most vulnerable households, we have agreed to extend our Council Tax Reduction Scheme in its existing form for another year. This scheme offers a Council Tax discount to eligible residents on low incomes whether in work, unemployed or retired.

Darlington is not alone in facing these pressures. Councils across the country are struggling with the same issues. These have been widely reported in the media over the last year, some of them indicate they are unable to balance their books.

Unless extra government funding is granted the Council will need to undertake a major review over the course of 2024 to decide what and how services will be delivered in the coming years.

Extensive consultation with residents, staff, charities, businesses and key stakeholders will be carried out next year. We can then explore how we can deal with the scale of the financial challenge we face.

Read the detailed report in full [pdf document]

Appendices

• Appendix 1 [pdf] Revenue Estimates
• Appendix 2 [pdf] Budget Pressures
• Appendix 3 [pdf] Fees and Charges Proposals
• Appendix 4[pdf] Assumptions used to prepare estimates
• Appendix 5 [pdf] Projected revenue outturn 2023/24
• Appendix 6 [pdf] Proposed MTFP 2024/5 - 2027/8
• Appendix 7 [pdf] Capital MTFP 2024/5 - 2027/8

You can have your say on the MTFP proposals by sending comments by:

• email: [email protected]
• post: Finance Team, Darlington Borough Council, Town Hall, Feethams, Darlington DL1 5QT  

There will also be hard copies of the plan available at Crown Street and Cockerton Library.