Cllr Glen Sanderson has been critical of the settlement received from the new Labour Government after the scrapping of the rural services delivery grant, worth £3.2 million to the council.
The council will also not receive any cash from the £600 million Recovery Grant, announced as part of the Autumn Budget to support areas most in need.
Alongside increases to national insurance payments, it means the council is facing a £2.6 million hole in its current budget calculations. The budget is set to be finalised next month.
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Speaking at Monday’s meeting (January 13) of the Castle Morpeth Local Area Committee, Cllr Sanderson said: “This is a very disappointing settlement. We have lost our rural services delivery grant and we are getting nothing from the Recovery Grant – not a single bean.
“We are having to find more money to deliver the things we have to do. We need a lot more.
“We are £2.6 million down on what we had expected based on previous years.”
Cllr Sanderson also defended the record of the previous Conservative Government on council funding. He pointed out that, when combining core funding with certain one off grants, funding increased by £24.5 million in 2024/25 and £17.8 million in 2023/24.
The Government say it has increased the councils funding by more than £20 million. However, with the addition of Government grants last year the council say the increase only equates to £13.2 million.
The leader repeated the message at Tuesday’s meeting of the council’s cabinet.
He said: “We had expected a similar kind of increase that we had in last year’s budget. There is a misunderstanding that this is a great settlement – it is not.
“We have a significant shortage, in the region of £2.5 million in relation to what we need to be able to deliver. We have had to look around for further savings.
“The biggest loser in the budget settlement will be our residents. We had hoped to be able to reduce the council tax this year, but that has been knocked on the head.
“We may be able to persuade the Government to increase the amount. I am hopeful they will be able to understand why we need this funding.”
Despite the pressures faced, Cllr Sanderson insisted that “front line” services would not be impacted.
He added: “We will continue to provide good leisure facilities, build our super schools and provide free town centre car parking. These are written in gold and we will not move from those.
“We will come to a budget that will be for the benefit of all our residents and businesses.”
The Labour leader of the opposition, Cllr Scott Dickinson, previously criticised the Conservatives for failing to criticise the previous Conservative Government for reducing funding in real terms.
Asked to respond to Cllr Sanderson’s criticism, the Government said it had provided an additional £20.3 million for Northumberland County Council as part of a £69 billion cash injection for council budgets across England.