Issue - meetings

This report outlines the forecast financial position of the organisation at the end of 2024/25 based on the information known at the end of the first quarter.

Cabinet Portfolio Holder – Councillor Peter Butlin

Councillor Peter Butlin (Deputy Leader and Portfolio Holder for Finance and Property) explained to Cabinet that the quarter 1 position reflected a concerning overall picture due to ongoing demand and financial pressures in four key areas, which were also the cause of financial strain on this council last financial year – Adult Social Care; Children’s Social Care; SEND and Home to School Transport.  Cabinet was asked to note the £47.5m overspend which one-off resources reduced to £27m and the 43% shortfall in forecast savings delivery largely relating to these four areas.   Councillor Butlin noted that these four areas were areas of significant financial strain for all upper tier councils across the country and whilst mitigations were being put in place, national policy change and/or additional resources were essential.  There was tension between the Council’s statutory duty to set a balanced budget, and the statutory requirements to provide services in these demand-driven areas to those who were eligible.   However, as a well-run organisation, the Council had acted swiftly to mitigate the pressures in line with pre-existing plans and trigger points, and the long-term financial resilience which meant that there were resources set aside to assist efforts to deal with some of these pressures.  Councillor Butlin advised that the Council had responded quickly and well to the additional controls. 

In the current climate, Councillor Butlin informed Cabinet that the Medium-Term Financial Strategy (MTFS) would be more challenging for current year and it was expected that additional savings of £10m above those set out in the previous paper to Cabinet (July 2024) would be required.  The Chancellor’s Spending Review and Autumn Budget would provide more clarity on the available resources and potential policy changes to fund and address the pressures identified as the Council progressed its preparations for setting the 2025/26 Budget and MTFS in February 2025.

Councillor Isobel Seccombe (Leader) commented that the Council had already engaged in lobbying the previous government and would continue with those efforts going forward.  She noted that the Local Government Association (LGA) had met with the Minister for Housing, Communities and Local Government to stress the need for funding settlements that were longer than one year but this would not wholly remedy the situation and emphasised the need for legislative change to enable the sector to manage and deliver all the services provided by local government, not just those which were demand-led.  She noted the impact of a growing and aging population on demand for adult social care and welcomed conversations with the government to address these funding issues. 

Councillor John Holland emphasised the need for political parties to work together on this issue and considered that the problem was not the result of budgets being exceeded, rather that they were not big enough.  He noted that the sector was working with a budget set by the previous chancellor and the ability to make in-year changes was somewhat difficult.  He observed that the new government had outlined plans for more house building and an increase in  ...  view the full minutes text for item 2