Communities Department takes axe to Council funding

The newly elected members of Derry City and Strabane District Council are facing a baptism of fire right from the off.

The 40 councillors are this morning taking their seats on the one Council in the North “most impacted” by swingeing funding cuts initiated by the Department for Communities.

Derry Now understands the Department of Communities recently informed Derry City and Strabane District Council the Rate Support Grant across the North is being slashed from £8.924 million in 2022/23 to £4.9 million in 2023/23 - a cut of £4.024 million or 45.09%.

Derry City and Strabane District Council will receive 20.05% from this total, an allocation of £982,450.

That will leave what has been described as “an unbudgeted pressure of £807,000 for the current 2023/24 financial year” and will definitely have major, ongoing recurrent rates implications, according to the Derry News source. 

This will potentially include an inability to fund the Labour Market Partnership beyond the first quarter of this financial year.

As Derry City and Strabane District Council has a number of staff fully funded by the Labour Market Partnership, significant challenges will follow from the Department for Communities’ decision.

Derry Now also understands Derry City and Strabane District Council has been informed of a potential 50% cut to its Good Relations funding.

In addition, it is awaiting clarification regarding a range of other critical funding sources, including community services, advice services, festivals, environmental health and its Policing and Community Safety Partnership (PCSP).

These issues are scheduled for “immediate critical consideration” for the new Council, with reports being brought to its first Governance and Strategic Planning (GSP) committee on June 6, where they be considered along with the “year end outturn report and position”.

Derry Now understands that Derry City and Strabane District officers are currently preparing a comprehensive response to the Equality Impact Assessment generated by the Department for  Communities cuts.

Derry City and Strabane District Council will also be working with other impacted councils to ensure a “robust and co-ordinated regional response” in relation to the Rates Support Grant cuts. These responses must be returned by June 7, 2023.

A spokesperson for Derry City and Strabane District Council said it was very disappointed at the advised cuts to Rates Support Grant.

They added: “This grant is allocated to the seven least wealthy and most rural and deprived Councils to assist towards delivering equality of service provision with the more wealthy Councils.

“Derry City and Strabane District Council is entitled to 20.05% of the overall funding pot and is the most significantly impacted Council.

“Following on from a number of previous significant cuts since Local Government Reform, this most recent cut creates an unbudgeted financial pressure of over £800k for Council in the current financial year and will inevitably have significant future rates or service implications if not restored.

“Council is working with all departments within Central Government to fully understand and monitor all proposed budgetary cuts to services including good relations funding and to assess the cumulative impact any budgetary cuts will have on Council’s ability to deliver vital front-line services.

“The new Council will immediately be briefed on the updated position and implications at June’s Committee meetings. An equality impact assessment has been issued by the Department for Communities and Council will be submitting a robust response.

“Earlier this year Council engaged in an extremely challenging rates process and introduced a number of efficiencies and service cuts with the aim of reducing the impact on ratepayers, keep services running and protect jobs, a situation that is challenging in the current climate with rising costs and increasing demands on services. 

“The Council will continue to work closely with all Government departments over the coming weeks and months to highlight the need for monies and services to continue.”