Our budget position strengthens but tough decisions ahead
At its meeting today (14 November 2023), Kirklees Council’s Cabinet received an update on the authority’s budget. The monitoring show’s our financial position has improved, with our forecast overspend for 2023/24 reducing from £20.3m in July to £16.1m in October.
Like many councils across the country, the impact of inflation and growing demand for services like social care for children and older residents has caused major challenges for local authority budgets in the current year and for future budgets.
Over the past year, we have implemented a series of actions to reduce costs. This has included a major reduction in recruitment, a review of our investment programme and removal of non-essential spending. We have also brought forward a series of savings proposals to reduce costs in the current year as well helping us make around £47m of savings needed to set a balanced budget for 2024/25, as required by law.
Every council directorate has improved its position over the past quarter and, alongside adjusting our use of reserves, the monitoring report details a reduction in our overall forecast overspend.
Councillor Graham Turner, Cabinet Member for Finance and Regeneration, said:
“We were one of the first councils to signal that local authorities were caught in a perfect storm of financial challenges. A combination of the cost-of-living crisis, national economic chaos and a funding system that penalises places like Kirklees has affected local authorities up and down the country, even prudent councils like ours.
“All our services rely on sustainable funding. That’s why we’ve been taking the tough action we need to set a fair and balanced budget for next year and why we’re controlling costs so vigorously in the current year.
“The financial monitoring report for this quarter of the year tells us three things. First, we are delivering the savings we put forward at the beginning of this financial year. It also confirms that we are taking considerable costs out of the organisation in every directorate. But crucially, it also warns us against complacency. If we are going to set a fair and balanced budget next year, further difficult decisions remain.
“If you talked to councillors or finance chiefs across the country, from leafy shires to inner-city boroughs, you would hear the hear the same story. The system of local government funding is broken. And it’s vital local services and communities who are paying the price.”