|Friday, 20 October, 2023|
|Bracknell Forest Council’s financial position|
Like most other local authorities across the country, Bracknell Forest Council is facing a challenging financial position – with unprecedented pressure on its budget.
On Tuesday, 17 October, the council’s decision-making executive was given an update on the interim budget position.
Earlier this year, the council was facing a financial gap of around £4m. However, due to lots of hard work behind the scenes, this had reduced to around £3m.
While this brings the council closer to balancing its books, and there is no current risk of bankruptcy (called a section 114 notice), it is still in a difficult financial position. A position it has never been in before.
This deficit is largely due to rising costs, rising inflation, increased service demand and years of underfunding from central government.
Like everyone, the council is not exempt from the rise in the cost of living. The high rate of inflation also affects all council services.
In addition to inflationary costs, the council’s budget is affected each year by other cost pressures, notably relating to increased demand for services. Alongside the higher demand for social care services, prices for care packages are rising much faster than inflation.
Additionally, more people in the borough have care needs that the council must meet, including children in care or with special educational needs and disability (SEND), and adults with learning difficulties or physical disabilities. This care and support is non-negotiable and must be prioritised but still adds to council budget pressures.
Another pressure has come from the amount of business rates collected dropping drastically. The national Valuation Office Agency (VOA) determines business rates for all businesses, and continuously re-assesses how much companies are paying. A number of significant businesses in the borough have been reassessed this year and so the council must make refunds backdated to 2017 - totalling several million pounds.
While all of these pressures are out of the council’s control, it must take action to address the budget gap.
Changes have already taken place with immediate effect to help reduce overspending, this includes making sure staff only spend on essential items necessary to provide frontline services and holding vacancies where possible.
Cllr Mary Temperton, Leader of the council, said: “Although the current year’s financial position is particularly challenging, we are in a strong place compared to similar local authorities.
“Some councils have declared bankruptcy, and the number of councils close to this position is rising. Thankfully Bracknell Forest Council is not in this position, but we want to be honest and transparent with our residents about our current financial situation.
“We are in an unprecedented financial position with a £3m gap due to spiralling costs, rising inflation and increased demand for our services. “While these are not factors within our control, we must address the budget gap. This means that over the coming months we will have to take some very difficult decisions and will have to look very carefully about what we can afford to prioritise for the remainder of this year and future years.”
The council’s interim financial position will continue to be monitored by senior staff weekly. Additional spending controls will be put in place, where necessary.
In parallel, work is being carried out on the budget for 2024/25. Many of the pressures being faced in the current year will inevitably impact on next year too. Draft budget proposals will be put to the executive in December, where they will be asked to approve a public consultation on the plans. You can watch back the update from the executive.
|You can watch back the update from the executive here|