Derbyshire County Council is set to consider ceasing all non-essential spending as it faces a £46m budget gap due to increasing costs.
The authority stated that despite delivering £300m of savings over the past 13 years, Derbyshire is set to overspend its 2023/24 budget by an estimated £46.4m.
Derbyshire said that this is due to “external forces” affecting the council’s budget, which include higher than anticipated inflation, increasing demand for services and “significant financial pressure” caused by the 2023/24 pay award.
In addition, a Cabinet Report, which is to be considered at a meeting on 21 September, outlined that the council’s reserves have “depleted significantly”, with almost £30m being used already in 2023/24. It also detailed that £55m of the council’s reserves were used to balance its budget in 2022/23, which was £23m more than what was originally budgeted.
The report explained that “significant actions” by Derbyshire County Council will need to be made to reduce the forecasted £46m overspend. It recommended that the council should cease all non-essential spending through a range of cost controls.
‘Painful decisions ahead’
Simon Spencer, Derbyshire’s deputy leader and cabinet member for corporate services and budget, said: “We’ll be making every pound stretch as far as it can – but we’ve been doing this for many years now and there’s only so far the money can stretch.
“We will be continuing to look at very strict vacancy controls, in some areas of the council we will still need to recruit people to deliver front-line services.
“We’ll continue to work hard to identify more ways to improve efficiency and realise savings while prioritising essential services for residents and supporting the most vulnerable people – but there’s no doubt very painful decisions will lie ahead.”
The report stated that other measures the council is taking to mitigate the overspend include looking at high-cost placements to find cheaper options, potentially stopping projects or deferring them until the next financial year and reducing the amount of spend on agency staffing.
Barry Lewis, Derbyshire’s leader, added: “The reality is that the financial pressures we are facing, along with other councils and households, are now greater than ever experienced before, with most of these pressures being simply outside our control.
“We’ve been taking many measures over the past few years to make sure we carefully control our costs, such as vacancy control measures, but now we need to do much more.
“We are continuing to lobby the government for extra funding so that we can continue to run vital services to those who need them most, but we also recognise that even more difficult decisions will be needed to be made to try to balance the books.
“This is a position that no one who goes into public service ever wants to be in.”
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