Cotswold District Council's cabinet has agreed a budget for next year to manage decreasing funding and prepare for further funding cuts in future.

The financial modelling done by the council shows that unless significant changes are made over the coming years to reduce spending and increase income, the council will not be able to balance its budget in 2026/27 as a result of planned changes to local government funding.

The council has seen its core Government funding reduced in real terms by around 50% since 2013 and the recent rise in inflation has pushed up the cost of delivering council services.

On top of this, the much-delayed review of local government funding suggests a further £3 million reduction in funding by 2026/27 which would cut the council's budget by around 25% in one go. Without certainty on when the review will happen and how severe its impact will be, councillors must make decisions now to prepare for it.

While the Government announced an additional funding package (referred to as Core Spending Power or CSP) for councils earlier this week, most of it will go to county and unitary councils, with Cotswold District Council receiving £12.471m - an extra £118k compared to the provisional figures provided by the Government in December (£12.353m) - only 0.95% more.

In the proposed budget for 2024/25, the council is proposing to raise council tax by £5 a year for a Band D property and increase car parking charges.

Together, these changes could raise £685,000 to fund vital services. It's also proposing to increase the garden waste charge so that the service continues to be paid for by the people who use it and not subsidised by council taxpayers. The council is also doing more to find further savings including measures to make council operations more efficient.

Councillor Mike Evemy, deputy leader and cabinet member for finance, said: "The Government has failed to fund local councils properly for many years, and as a result, we are now facing an unprecedented financial challenge.

"While we welcomed the additional funding announced this year, it will not make any meaningful difference to our financial position and we still have no certainty for the future.

"For the time being, we are in a relatively sound financial position due to decisions in the last few years to raise charges and make services more efficient. The budget for this year once again will help us prepare for the potential 30% funding reduction we have been told to expect from the government in the next few years.

"Our proposals this year could save £1.5 million which would make a big difference and will help us to protect the services our residents and communities rely on. Last year, we were able to freeze car parking charges to help residents and visitors with the cost of living, but we can't afford to continue that freeze.

"By making difficult decisions in this year's budget, it will help us avoid making much tougher decisions in future and facing the harsh changes we have seen at councils that have lost control of their finances and faced bankruptcy."