Central Bedfordshire Council's budget shortfall more than doubles to £4million

Tough choices lie ahead for Central Bedfordshire Council after it was revealed its budget deficit has more than doubled after the government’s financial settlement for local authorities.

Councillors were told by the Independent administration that the outstanding amount was £1.9m for 2023/24 earlier this month, but it’s now risen to £4m.

Independent Aspley and Woburn councillor John Baker has informed councillors: “In December, we presented a draft budget with a remaining deficit of £1.9m.

“This included assumptions regarding the financial settlement and a predicted increase in a social care grant, which has unfortunately not fully materialised. This isn’t the time for me to criticise the settlement, but others have formed the view that it could have been more generous.

“After this settlement has been factored into the budget, it has resulted in the deficit increasing to £4m.

“You all know how difficult the financial position looks this year and next,” warned the executive member for finance councillor Baker. “That’s because we’re all in this together and we must pass a balanced budget at the end of February.

“I’m always keen to talk to anyone who can bring forward positive ideas as to how we move forward in these difficult times.”

The council had reported a half yearly budget gap of almost £9m, following this year’s freeze on council tax under the previous Conservative administration.

Councillor Baker updated the executive earlier this month saying: “This report is brought here because of the serious nature of the overspend we’ll see this year, that’s £8.8m of extra reserves predicted to be spent above our contingency.

“The report clearly states that the council maintains sufficient reserves to cover the unplanned draw down and so doesn’t require the issuing of a section 114 notice.

“It directs all officers to identify ways of reducing the financial overspend before the end of 2023/24. There’s detail on actions under way already.”

A report to the executive explained: “The council is forecasting an overspend this financial year mainly because of a combination of inflation staying higher than predicted this time last year, and sharply increasing demand and costs in children’s services.

“Education transport costs are forecast at £6.1m more than budget and children’s placement costs at £0.9m overspend.

“Given the increase in costs and demand, setting a balanced budget for next year will prove challenging and is compounded by the decision not to raise council tax in the current year.

“This would have meant up to an extra £9.5m in the base budget every year, if the maximum limit of five per cent had been applied.

“This inevitably means CBC will have to make difficult choices about what services it can afford to provide, increase charges for these, raise council tax in future years and require the short-term use of reserves because having a balanced budget is a legal requirement.

“Taking urgent action to contain this overspend is an appropriate response, while trying to maintain front line services and continuing to meet CBC’s statutory duties.

“Budget holders are being tasked with reviewing all uncommitted expenditure to at least delay it into next year or cancel it where possible.”