West Sussex County Council has reduced its projected budget gap for 2025/26 from £60m to £38.5m.
If a council tax increase of 4.99% is imposed, the gap will stand at £8.2m.
The figures were shared during a meeting of the cabinet on Tuesday (October 29).
The £60m gap was forecast in July and, while progress has been made, the forecast deficit is still sizeable.
Jeremy Hunt, cabinet member for finance, said the council’s income and outgoings had been reviewed since July and budget reductions of £13.6m were proposed for 2025/26.
They include £3.3m from adults services and £4.4m from children’s services – the two most high-pressure areas when it comes to demand and cost – though most of the two reductions had already been approved in February.
Mr Hunt said: “We are continuing to see a high demand for our services, in particular social care, and next year we are currently predicting we will need to invest an additional £23.9m in vital services.
“Also, alongside our normal pressures such as inflation, we have the added challenge in setting our budget for 2025/26 of a new government, who up until this point have not given us any indication of their proposed funding plans for local authorities.
“This has made the budget setting process extremely challenging.”
A public consultation on the council’s priorities and budget plan will be launched on Monday (November 4).
Feedback will be considered at a meeting in January before the final budget recommendations are put to the full council in February.
While details of the national autumn budget are to be shared this week, the final level of funding on offer to councils across the country will not be known until the Local Government Financial Settlement is published in December.
The cabinet agreed to continue to lobby the government about the financial strain being placed on councils, with the rising demand for services making it increasingly difficult to balance the books.
Paul Marshall, leader of the council, said: “We again find ourselves in the difficult position of having to make decisions about vital services for our residents, when the funding available to us is not enough to pay for them.
“We are doing everything to prioritise essential services, especially to the most vulnerable residents and communities, and we have already made good progress to reduce our budget gap.
“However, further action is needed between now and February when we will set our final budget.”
