Cambridgeshire County Council’s estimated budget gap for 2024/5 has increased from a predicted £16m to more than £23m – largely due to increases in demand for services and inflationary pressure, Members will hear.
In papers published for next week’s Strategy, Resources and Performance committee, the Council is also estimating that without action being taken this gap will grow, and is predicted to be more than £20m in the following year, and a further £19m+ the year after that.
With the LGA currently reporting councils face an ‘inflationary storm ‘ with a predicted £4billion funding gap over the next two years, Cambridgeshire County Council is not alone – but a report to Members from Chief Executive, Stephen Moir and Michael Hudson, the council’s Executive Director of Finance and Resources – sets out some of the key reasons for the increased predictions and some of the mitigations the council is already putting in place.
“In 2023-24, pressures on our budget have arisen principally due to several very high-cost children’s social care placements and a delay in receiving income from a newly constructed solar farm (which requires connection to the electricity grid). In addition, we are seeing that demand for bed-based care for older people is also rising, following a period of reduction in demand and then stability stretching back for some time, to the beginning of the pandemic, “ the report outlines.
It also points to wider national and even international issues which have impact on the council’s pressures – such as interest rates which the Bank of England has said are likely to remain above 5% until 2026, which impact on all goods and services the council buys, the cost of borrowing as well as pay award costs for both council workers, and a large externally commissioned workforce which includes residential care for vulnerable adults and children.
The report highlights how all services in the council have been undergoing a comprehensive exercise to identify efficiencies to mitigate the impacts facing its budget, and a number of specific reviews into particularly high cost areas such as home to school transport, children’s social care placements and high levels of historic adult social care debt.
Proposals to set the Council’s 2024/5 budget will be discussed by Members in December before a period of scrutiny, throughout January, including an opportunity for residents to comment on the plans.
