CEREDIGION County Council is forecast to overspend its budget by just over £100,000, but that could be worse if expected cost savings are not made, senior councillors will hear next week.
A report before the council’s Cabinet meeting of September 3, will outline the council’s financial situation at the quarter 1 point in the current financial year.
This comes on the back of a February-set council budget which listed some 70 areas of savings totalling £5.793m despite a council tax increase of 11.1 per cent.
A report before members states: “At the quarter 1 point in the year the financial position continues to be challenging, which is no surprise given the difficult budget setting process and the resulting in year delivery of savings required.
“At this stage a projected overspend is forecast for the year of £101,000 on the Controllable Budget. However, this excludes certain risks in relation to the delivery of in-year savings.”
‘Headline challenges’ in the report include undetermined national pay awards, significant high-cost complex out-of-county children’s placements, agency staff for residential home and social worker roles, and operational difficulties in refuse collection.
The report says Out of County Children’s placements have a current cost of some £300,000 per placement, with 23 residential placements and 10 college placements.
Despite new in-county facilities due to start becoming operational later this financial year, the total gross expenditure is currently forecast to be c£7.2m on the 33 placements for 24/25.
Social Care agency staff is expected to cost £1.138m, against which £500,000 is being factored in from reserves to partially mitigate.
The report says the Refuse Collection service “has faced operational difficulties, particularly in the south of the county,” adding this is “mainly due to a combination of staff shortages and an ageing fleet”.
It says a “targeted in-year investment” has been made including seven new posts and replacement fleet and technology solutions, totalling £200,000 capital and £464,000 Revenue (of which £230,000 is the estimated part year revenue cost for 24/25).
Of the 70 savings identified in the ’24-’25 budget, the report says 56 items totalling £4.1m either fully complete or fully on track, leaving 13 items totalling £1.7m either partly on track or not on track as yet.
It warns that each £450,000 equates to approximately one per cent in Band D Council Tax terms.
The report concludes: “The council has a financially resilient balance sheet, with £44.0m of earmarked reserves and £6.7m in general balances as at 31/03/24. However, relative to the council’s £193.6m budget, the combination of earmarked reserves and general balances only affords approximately three months’ worth of cover.
“Taking all matters into consideration, at this early stage the in-year financial position is being managed within an acceptable level of tolerance, whilst at the same time acknowledging that there are multi-faceted ongoing risks.
“All services and their budget-holders are expected to continue the proactive Team Ceredigion approach to maximise their financial positions where possible, in order to assist the wider overall council position.”
