South Hams District Council has said that "careful financial management keeps SHDC resilient"

Despite increasing pressures, South Hams District Council says it is setting a balanced budget for 2025/26 "thanks to careful financial management".  

On Thursday, 13 February, South Hams District Council agreed its budget for the next financial year. 

A spokesperson for SHDC said: "The council is forecasting a £3.40m budget gap by 2026/27, mainly due to the Local Government Finance Settlement announced in December 2024 and rising cost pressures. 

"The Government withdrew the Rural Services Delivery Grant (RSDG) and with it a £0.5m funding grant which had compensated rural councils for the fact that it costs more to deliver services in rural areas. This year will also be the last for the New Homes Bonus payments, a vital source of income for councils.

"The unexpected rise in employer National Insurance contributions has also been another blow to the already stretched finances, with only a third of the cost being covered by Government funding.  

"The withdrawal of these key funding streams has resulted in a significant loss of funding both now and in the future, so the council has had to make some difficult decisions that in other years it might not have wanted to make. As a result fees and charges have had to increase to maintain the delivery of quality services."

Councillors agreed to increase South Hams District Council’s share of the Council Tax by £5.70 for the year. This means residents living in a Band D property will pay £196.66 a year to the district council for all of its services, less for residents living in bands A, B or C, more for bands E and above. This increase is less than 11p per week - a rise of just 2.99%.  

Cllr Julian Brazil, Leader of South Hams District Council, said: “We’re doing a lot with very little, especially after the poor financial settlement from Central Government. Prices have gone up, and utility companies and businesses have had to raise their prices in recent years and unfortunately, we must do the same. If you want to balance your books, you must cut your cloth accordingly.  

“We’re doing all we can to make sure we meet our housing ambitions. We bought 17 homes under the Local Authority Housing Fund scheme and have attracted Government grants of £2.5 million in match funding. We have numerous housing projects in the works, bringing both social rented and temporary accommodation to those who need it, with more in the pipeline.

"The decision to ringfence the second homes income for the very people who are impacted by the lack of available housing in the area shows our commitment to the housing crisis. This money will be used for housing initiatives.

“The waste service is working well with improving recycling rates. Combine this with how we’ve reduced our carbon footprint by increasing the amount of EV chargers and the planned installation of solar panels on our leisure centres, along with the huge new planting which has begun at Hope Wood in South Brent, and we’re making excellent headway on our climate and biodiversity aims. 

“We’re doing everything we can to support our residents and deliver the services that matter the most to them. That’s what we were elected to do and that’s what we’re using our finances to do.”