North Yorkshire: Jobs warning by council boss in £100m crisis

Richard Flinton has issued a stark prognosis of North Yorkshire County Council's future as the authority's most senior tier of management oversees multi-million pound savings to cope with an expected fall in Government grants by up to a quarter.

Mr Flinton, who took over the top job at the council at the start of July, admitted the financial crisis is the gravest situation which he has faced in a career in local government spanning more than 20 years.

He said: "What we are faced with for the first time in many years is an increasing demand for services while budgets are having to be cut. Previously there has been an increasing demand for services but this has always been countered with an increase in funding – it might not have been enough, but it has gone some way to helping.

"This is certainly the most challenging time I have ever known in my career in local government, but it is a challenge which I am determined the county council will rise to.

"However, front-line services will be affected and there will be some redundancies, although at this stage we do not know exactly how many.

"We are acutely aware of the human cost of people losing their jobs, and we will be doing all we can to reduce staffing levels without imposing compulsory redundancies. But we will have to make job losses if we are to cope with the anticipated drop in funding from central government."

The county council will have already made 60m in savings in the last six years at the end of this financial year after conducting a wide-ranging review to streamline services.

However, Chancellor George Osborne's announcement that local authority grants are likely to be slashed by 25 per cent will mean that the council will have to enforce a further 43m in financial savings by 2014/15.

An additional one-off saving of 10.8m is also having to be made during the current financial year after the coalition Government announced it was reducing local authority funding nationally by 1.2bn just after coming to power in May.

The cutbacks are having to be brought in North Yorkshire against a backdrop of increasing demand for services, especially in waste management to avoid landfill taxes as well as a dramatic rise in the need for care of the elderly.

While an exact figure on redundancies has yet to be established, Mr Flinton's predecessor, John Marsden, warned earlier this year that up to 500 posts could be lost from the council's 24,000-strong workforce.

A root-and-branch review is underway across almost every department to make the cuts to an annual net budget of 350m. The only department which has been ring-fenced and spared the axe from financial savings is education.

Mr Flinton admitted that while every effort would be made to preserve North Yorkshire's education services, they may be affected in the future. Among the services most at risk are libraries and subsidies for bus services.

Mr Flinton urged the Government not to "take a blunt approach" to making the national cutbacks in local authority grants.

He said: "In North Yorkshire, we have a below average spend, below average council tax rises and below average government grant, but we still remain an efficient authority.

"We have to become even more efficient, but we are not an organisation where there is a lot of fat that can be trimmed off.

"The Government needs to be sensitive to the issues that all local authorities face, and realise that one size does not fit all."

Extra pressures are mounting after the Government announced plans for a national council tax freeze during at least the next financial year.

A planned 2.5 per cent annual increase by the county council from April 1 next year would have generated an extra 6m, although Mr Flinton maintained he is hopeful that an emergency subsidy will be obtained from the Treasury to counter the shortfall.