North Tyneside Council set to slash 200 jobs amid 'unprecedented' budget pressures

A North East council is set to cut 200 jobs as it grapples with a multi-million pound budget shortfall.

North Tyneside Council has announced plans to reduce its 4,000-strong workforce by five per cent, in an effort to help balance its books. The authority informed staff last Friday that it was opening applications for voluntary redundancy, aimed at shaving £6.5 million from its wage bill over the next two years.

Finance chiefs are also planning a 4.99% council tax hike from next April, under initial plans that will be presented to the council’s cabinet next week and be finalised in February next year. Jon Ritchie, the council’s director of resources, said bosses were “finding it increasingly difficult to achieve a balanced budget”.

Officials are warning of a predicted £9.5 million overspend in the current financial year alone, plus a further £31 million in 2025/26 – blaming issues including increased numbers of vulnerable children, inflation levels increasing payments in areas including waste and private finance initiative (PFI) contracts, and escalating costs for both children’s and adult social care. The council said that it hopes to save £2 million from adult social care services by reducing its reliance on contracting more expensive private operators and having people receive care in their own homes for longer.

Mr Ritchie added: “We’re experiencing unprecedented pressure on many of our services, especially social care where case numbers, complexity and costs have increased at higher rate than Government funding. We have a £9.5 million forecast overspend this year if we do not take further action, so need to make some difficult decisions to keep delivering our priorities on a balanced budget. For next year, we currently have a £3.9 million funding shortfall.

“As part of our wider plan to transform services and make savings, we’re reviewing our workforce with the intention of reducing it by 5% over the next two years, including a voluntary redundancy scheme. We remain committed to delivering the priorities of the Our North Tyneside Plan for our residents, businesses and communities. We appreciate that this will be an opportunity for some colleagues, and an unsettling time for others, and we’re working with trade unions and our People team to ensure everyone is supported”.

But Coun Liam Bones, leader of the North Tyneside Conservatives, accused the Labour-run authority of “financial mismanagement” on Monday. He added: “Cutting five per cent of council staff while they protect things like the chauffeur driven car and spend millions on cycle paths and other vanity projects is inexcusable. The mayor should commit to making sure these job cuts do not fall on front line staff who help our residents day in and day out, we simply can’t afford to see things like bin collections and clean up teams cut further.”

The council indicated that, should it not make the required workforce cuts through voluntary redundancy applications, deleting vacancies, and people taking flexible retirement, then it could be forced to make compulsory redundancies in 12 to 18 months’ time.

David Mason, the authority’s head of finance, admitted that the current £9.5 million shortfall is a “big figure and we would like it to be a lot lower” – but said he was hopeful of the deficit being reduced by the end of March, rather than the council being forced to eat into its reserves to make up that gap. Mr Mason added that council chiefs are also awaiting clarity on what extra pressure they will face as a result of the Labour Government’s planned increases to employers’ National Insurance contributions.

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