The council is being told must introduce new charges, hike existing ones, sell off assets and reduce services to the bare bones to cope with a budget “crunch point”.
Soaring inflation and increased demand, particularly for social services, means the council is facing a £14 million overspend this financial year.
To avoid this, auditors say it must make “politically unattractive or undesirable decisions” to ensure its future viability.
Last year, it was forced to dip into its reserves to pay for a £3 million overspend – the first time in over a decade it had gone into the red.
A special audit report commissioned by Labour when it won May’s elections says if this year’s forecast overspend materialises, it would be forced to spend the rest of the reserves to balance the books.
And the budget gap for next financial year is currently forecast to be £25 million.
The report, by Grant Thornton, said: “The council must put effort toward exploring all opportunities for increasing income from fees and charges, potential fundraising opportunities, service transformation which may include drawing back services to the statutory minimum, revision of policy priorities to ensure alignment with financial sustainability, reallocation of earmarked reserves, asset sales and alternative means of cost avoiding or income generation.
“The current medium-term savings requirement is treble what the council has been able to deliver in the past few years. The ask is massive – the council must organise itself accordingly.”
Areas where the council has overspent include homelessness accommodation, adult social care, children’s services and, until recently, continuing covid expenses.
Inflation, interest rates, Brexit and supply chain issues, nationally agreed pay rises and dwindling government funding were also identified as pressures.
It says there aren’t any significant weaknesses in governance, although it has recommended not allowing councillors to sit on both the audit and standards committee and the strategy, financial and city regeneration committee.
Currently, Labour councillor Julie Cattell sits on both.
It also says the council’s budget setting arrangements have been appropriate.
However, It says the council’s top directors were informed last month of the need to start looking at how to make savings for 2024/25, and that next year’s budget process needs to be “fundamentally different”.
How much are the street lights renovation going to cost.
This lot haven’t got a clue.
Could’nt find their backsides in the dark. In 4 years time its ” vote for us”.
Did you actually read…any…of the article before going off on your disingenuous outcry?
That white elephant, the I360, isn’t helping
£2 million. That could plug a hole.
Yeah, definitely not helping. And it’s really difficult about what to do about it as well, there’s not a clear solution. Least they are making some leeway into it, but still, very tough situation to be in.
Lol, the Greens are looking positively prudent next to this lot.
Alternatively, the outcry over the Green’s £3m overspend when it was published only a few short months ago was misplaced – there are serious issues with funding from central government for all councils across the U.K. The Council can’t do much about external pressures (interest rates, inflation) or the internal demand (homelessness, social care, children’s services), central government needs to step up and provide additional funding to councils across the country.
Sell of some assets but then rent income goes .
Unless they are empty because businesses can’t afford the rent levels?
I fear that we have lost Hove Library .
£14 million overspend.
Coincidentally the same amount the council lost with the i360 debacle!
The Greens should be held accountable for this scandal!
Sell off the arches, I’m sure a private company could put them to better use and also how about making sone of the lazy lot on benefits actually pay their concil tax rather than it being subsidised by the people that do work. I was once told by someone who worked at the council that something like 50% of the council tax gets spent on adult social care whic is way too high, especially as this includes druggies and alcholics.
Continued blaming of Greens and/or Labour in the comments while this is an issue affecting nearly every council in the country regardless of the rosette at the helm. The Local Government Association calculated that nationally, savings of £2 billion this year would need to be found by councils to balance their budgets. Councils simply do not receive sufficient tax revenue nor are equipped with sufficient alternative means of raising funds to accomplish what they are tasked with. In fact, we’re relatively privileged in Brighton in that the council has managed to maintain many services that other councils slashed all the way back in the austerity days and has even been able to make investments into improving the city (many councils can only dream!). The prospect of the council having to potentially sell assets that will then be lost for good in order to make up a funding shortfall for one year is extremely saddening.
Councils invest in the local area and provide front-line services that benefit our lives far more than, for example, spending an estimated annual cost of £19 million on an empty barge (sufficient to fix our council’s deficit), or spending £4 billion on sub-standard PPE destined for the incinerator (enough to cover this year’s national council shortfall twice over), or blowing £30 billion by crashing the economy with a mini-budget for the sake of ideology (enough to finally fill in all the potholes). They really should be a higher priority for funding.
I would like to see BHCC, open it to the public for suggestions as to how to make savings, plus how to generate money.
I think that at times these consultations, and meet-ups, appear like a load of tosh at times.
However, I’m sure most people have ideas, which collectively would make a difference. I hope the council are innovative, do work with local people and businesses, to bring forth these ideas, and turn them into reality.
The problem is that most of those initiatives result in people saying variations of the same thing: “slash funding to the services I personally do not use.”
There’s basically no consensus out there about what the council’s priorities should be. You see it in the comments here: people saying that graffiti and fountains should be top of the list when we have kids vanishing from care and housing wait lists longer than the average life expectancy.
Yes, I understand and you’re right about the savings, and differing perspectives.
Perhaps there’s a way to look at generating the income side. Look at things we’re good at at, but not maximising at the present. They do not necessarily have to be new projects, just opening things up a bit. Ok, it may not make a huge increase to our coffers, but it may bring in some income, or maybe it’s just a fanciful idea. Must say, I’m not an innovator or business person, but at the moment it helps to hope, and hope there are people that are out there.
Good to know we have reserves and a pot to dip into: clearly the bean counters have been active – if not appreciated!