Another Sussex council is set to dip into its reserves to balance the books.
East Sussex County Council may need to draw an extra £10m from reserves at the end of this year – just a week after Hastings Borough Council said it needed to take almost £2 million.
The East Sussex figures were set out in a monitoring report looking back at the second quarter of the year, considered by the council’s cabinet yesterday.
It said the council expects to see a total overspend of £24.2m by the end of the financial year, with the majority of this coming from the authority’s department for Children’s Services.
While the overall impact is expected to be mitigated by other elements of the budget, the overspend is expected to result in an unplanned draw of £10.5m from the council’s financial management reserve in 2024/25.
This is in addition to the planned draw of £14.3m, which has already been agreed.
Council leader Keith Glazier (Con) said: “The overall finance position continues to remain challenging … the total forecast revenue overspend for services is £24.2m. It was £23.4m at quarter one; an increase of £800,000.
“This is primarily due to the forecast overspend in Children’s Services of £13.9m due to the pressure of early help and social care and homes to school transport.
“Also projecting overspends are Adult Social Care at £10m and Business Services at £800,000, whilst Communities, Economy and Transport are forecast to underspend by £600,000.”
This financial position saw concerns raised by David Tutt, leader of the council’s Liberal Democrat group.
He said: “I think you’ve perhaps become master of the understatement when you say the financial situation is challenging. It is dire, let’s be honest — a £24.2m overspend [and an] eighty-odd million forecast deficit as we go forward.
“We have worked together and will continue to work together to lobby government, but I think we all have a shared nervousness to what we may or may not get from the £700m that is going to be used to target areas of deprivation.
“Although we have worked hard to ensure that the areas of deprivation in East Sussex are known to government … it is a very worrying situation going forward and I don’t think anybody would deny that.
“I will be a little bit critical of the stance that the administration took in budget setting in February. We have every year for the past few years drawn attention to the pressures on Children’s Services and said there needs to be more realistic budgeting and that those pressures need to be taken into account.”
Labour’s Trevor Webb made a similar point on lobbying, saying the government was aware of the county’s areas of deprivation and argued they could be set to benefit from a share of the government fund mentioned by Cllr Tutt.
Cllr Webb said: “I can assure people that the Labour group on East Sussex County Council have been strenuously lobbying … and we have been made assured that Stephen Kinnock, the minister for care, was aware of the areas of deprivation in Hastings and throughout East Sussex and that is going to be one of the areas of deprivation which could be in that budget.”
Godfrey Daniel, another Labour councillor, struck a somewhat different chord, however. He said: “What actually does surprise me is the lack of political responsibility for this budgetary crisis.
“Basically we have been a lobbying authority almost as long as I have been on the county council and I think we have to recognise that for the last 14 years local government has been hollowed out. The sooner that the politicians running this council actually accept that, then I think we’ll be on stronger ground to make lobbying claims for the future.”
He added: “The mess we’ve got into is of your making leadership group and this is not a very satisfactory situation. If you are going to lobby the government make sure you actually confront the situation, that the Conservative government let down local government.”
Cllr Daniel’s comments prompted criticism from Cllr Glazier, who said: “I can’t remember one occasion over the last four years when we haven’t written to the government of the day explaining that there is not enough money in the local government settlement.
“It is not something that we are dreaming up because there is a new master plan with the new government. This has been consistent. If you don’t believe that I will dig out the papers that will show you the letters we have written on behalf of this authority.
“If you look again and read the papers you will see the reason for this currently is Adult Social Care placements going up at 40 per cent over the last three years, numbers going up consistently, the expectation of our residents continue to rise; none of that … could have been thought about even at the time we set the budget in February.”
Cllr Glazier added: “I join Cllr Webb’s optimism that we … or he has been able to convince his colleagues in the government that Hastings and other areas in East Sussex has significant deprivation which needs considering under that other £700m, but we can only hope on that.
“Early indications … is that actually it won’t go to many county councils. We could be significantly worse off than we had expected. So let’s wait; it is only a week away now. The 19th will soon fly round and we will then know exactly what we’ve got.”
