A report considered at a Cabinet meeting last night (16 July) shows a deficit of £19.2million at the end of 2023/24 financial year. The figures are down by £1.6m from the previous projection thanks to the delivery of substantial savings across the organisation and additional grant funding.
Councils across the country are facing huge financial challenges. It is thought UK local authorities are expected to be £5.2bn short of balancing their budgets by April 2026, with the average council facing a predicted deficit of £33m.
Significant strain has been put on the financial position due to external forces beyond the council’s control including increased demand and cost of key services such as social care and temporary accommodation.
Cllr Dana Carlin, Cabinet Member for Finance and Corporate Services, said:
These figures should not come as a shock. We knew last year was going to be incredibly difficult because, like all councils, we had to cope with unprecedented pressures beyond our control.
We have been projecting a significant shortfall, reported transparently throughout 2023/24, because of an unsustainable rise in the costs of adult social care, children’s placements and temporary accommodation for homeless families.
We put substantial funding into our 2024-25 budget to deal with the anticipated overspend and will continue to work hard to mitigate the strain on our resources. We need to maintain our focus on good financial management and continue to be open with our residents about the challenges.
Despite the financial challenges affecting every local authority, council departments continue to make savings and delivered almost 80% of these in 2023/24, a higher proportion than in previous years.
Led by directors, a comprehensive plan to reduce the budget shortfall is already underway including ensuring the council gets the very best value out of every pound it spends.
At the meeting, Cabinet approved the use of reserves. The 2023-24 Provisional Financial Outturn Report can be read here.
