Budget pressures facing council ‘unprecedented’

Bath and North East Somerset Council is set to overspend by £4.5 million between 2022 and 2023, due to “spiralling” costs.

A pair of reports detailing the scale of financial challenges facing the local authority were due to go before cabinet today (Thursday).

The council said “rising inflation, increasing demand for services and uncertainties over central government funding” had put it under pressure.

The council’s budget for 2022-23 requires £11.87 million in savings and income generation, with £36 million needed to be found over the next five years. The budget was meant to cost £126.12 million but is projected to reach £130.62 million.

A monitoring report on the council’s finances from April to September this year describes rising demand for, and increasing costs of, care packages for children and young people, as well as increased costs for home-to-school transport.

Pay awards, rising fuel costs and reductions in income have also impacted council finances, but it said these had been partially offset by lower borrowing costs and extra Heritage Services income, resulting from strong summer visitor numbers. Income from off-street parking is also helping finances and it said this had broadly returned to pre-pandemic averages.

Alongside the monitoring report, councillors will also consider the Medium-term Financial Strategy (MTFS), which provides the longerterm framework for the council’s budget-setting.

The report highlights that the 2022/23 budget requires £11.87m in savings and income generation, with £36m (including £2.32m already identified) needed to be found over the next five years, of which £19.43m is required in 2023/24.

This is based on the assumption that Council Tax increases of 2.99 per cent remain for the period to 2024/25, with Council Tax reverting to 1.99 per cent from 2025/26.

Cllr Richard Samuel, cabinet member for resources, said: “Despite our prudent financial management we are facing unprecedented pressures and the prospects are far from encouraging.

“A continued lack of clarity around future funding for local government, high inflation and significant demand on our children’s services have created a very challenging financial position for us.

“The Local Government Association estimate that spiralling costs have added at least £2.4bn across local government to the budgets councils set earlier this year. We want to be upfront with residents about the scale of the pressure facing us, which we know comes as people are themselves increasingly struggling with their own household budgets.

“We know that rising energy costs and inflation are having a real impact on people’s lives. “We will need to prioritise our spending and ensure we do everything we can to help local people, as

well as boosting the local economy to sustain and attract good quality jobs.

“The continued strength and attractiveness of our city centre is reflected in the number of visitors we are seeing to our Roman Baths, which boosts income into the council.”

An online briefing to discuss the impact of the cost-of-living crisis on residents and businesses and the impact on council finances was held last Thursday.

The Revenue and Capital Budget Monitoring, Cash Limits and Virements - April 2022 to September 2022 report to the cabinet and the Medium Term Financial Strategy 2023/24 -2027/28 are on the council’s website. You can watch the cabinet meeting today (November 10) on the council’s Youtube channel - www.youtube.com/user/bathnescouncil.

We want to be upfront with residents about the scale of the pressure facing us, which we know comes as people are themselves increasingly struggling with their own household budgets. Cllr Richard Samuel, inset