Bosses are considering putting their share of council tax bills up by 3.53% in a bid to bring in an extra £343,000 in revenue.
South Holland District Council says the rise in bills being considered in its draft budget would be £7.11 for a year for a Band D property or 13.6p a week.
The draft general fund and housing revenue account budgets for the next financial year, alongside the medium-term financial strategy/plan and capital programme for 2025/26 to 2029/30, were presented to a joint performance monitoring and development panel on Tuesday evening (January 21).
Christine Marshall, joint deputy chief executive, described it as ‘one of the trickiest budgets’ she had ever encountered.
She noted that the provisional government settlement announced in December resulted in a £332,000 reduction in grants, with the removal of the rural service delivery grant being a major factor. While £231,000 was received as part of a recovery grant, it was insufficient to cover the overall reduction.
One of the most significant cost pressures comes from the Internal Drainage Board (IDB) levy, impacted by rising power costs and other inflationary pressures. Between 2021/22 and 2025/26, the levy has increased by £994,000 annually, creating a recurring financial burden. This has not been fully addressed, despite one-off grant allocations of £335,000 in 2024/25 and £298,739 in 2023/24.
A budget consultation process with the public was launched on Thursday, December 5, and concluded on Monday, January 6, garnering 51 responses—an increase from 29 the previous year.
The consultation revealed that only 39% of respondents were aware that the annual increase levied by Internal Drainage Boards had taken the majority of or exceeded the additional amount collected from the council tax increase. The remaining 61% stated they were unaware.
Respondents were also asked if they were aware that, for every £10 of council tax charged to properties, South Holland District Council only retains 94p, and of that, 52p is passed on to the IDBs. Only 41% were aware of the amount passed on, while 59% indicated they were not.
The council has been in detailed discussions with government officials. Lobbying efforts are also underway, highlighting the ongoing impact of the embedded levy on the council’s revenue, which compounds with each passing year.
Deputy leader and portfolio holder for finance, Cllr Paul Redgate (Conservative), stated: “The biggest challenge we face is the IDBs. This problem is not going away. I dread to think over the next two years the direction of travel.”
Acting as chairman for the joint meeting, Cllr Andrew Woolf (Conservative) added: “This is the most negative I’ve probably felt when it comes to a budget scrutiny session. Ultimately, we have less money, but the demands and the requirements are larger.”
Cllr Bryan Alcock (Independent) echoed similar sentiments to Lincolnshire County Council leader Martin Hill, arguing that funding was being shifted away from rural areas, citing the removal of the rural services delivery grant as an example.
“It’s a deliberate action, and the rural areas will suffer as a result of it,” he stated.
The draft budget for 2025/26 is set to be reviewed by the cabinet on February 18, before seeking final approval from the full council at its meeting on February 27. It will also be discussed by Spalding Town Forum tonight (January 22).