A North Yorkshire County Council boss has said financial flexibility will be needed “like never before” amid uncertainty over local government reforms and the lasting impacts of the Covid crisis.
Gary Fielding, director of strategic resources at North Yorkshire County Council, said setting the authority’s upcoming budget had been a difficult task and that he could not rule out emergency spending plans would not be needed later this year.
Mr Fielding said the council is facing an £83m funding shortfall over the next three years but added it would be able to “buy time” by using cash reserves and government grants to balance the books for 2021/22.
The county council – along with North Yorkshire’s seven district and borough councils – will be disbanded and replaced with one or two new unitary authorities within two years as part of local government reforms linked to devolution.
Mr Fielding said savings from the new council structure could offer a solution to the financial woes but added uncertainty over how it would take shape created problems for planning.
“There has never been as much uncertainty as there is at the moment,” he told a meeting on Friday.
“We don’t have any visibility on a spending review beyond 31 March 2022 and we don’t know if there is going to be further austerity to follow.
“Local government reorganisation may well be part of the solution. But if it doesn’t happen or finances significantly deteriorate, I can’t rule out the possibility of needing an intermediate budget later in 2021.
“There is going to be a need for incredible flexibility like there never has been before.”
As part of the local government reforms, North Yorkshire County Council has put forward a proposal for a single unitary authority covering all of North Yorkshire while district council leaders propose creating two councils of similar size either side of the A1.
The government is evaluating the rival bids and will soon launch a public consultation before reaching a decision on which option to take later this year.
Councillor Richard Cooper, leader of Harrogate Borough Council, said residents could be asked for their views on the proposals as early as next month.
He told the Local Democracy Reporting Service: “Shortly before Christmas, along with North Yorkshire’s district council leaders I met virtually with the Minister for Local Government, Luke Hall, to present our case.
“The minister told us that there will be a full public consultation on all viable models for local government submitted to him. This public consultation will begin early this year – maybe as soon as February.”
He added: “Devolution – powers and cash coming down from government to be exercised locally – may also happen in May 2022 at which point we will also elect a Mayor for York and North Yorkshire. If that doesn’t happen in May 2022 it looks certain to happen in May 2023.”