Tight budget controls have enabled Brighton and Hove City Council to reduce its forecast overspend in the current financial year.
In October, the council’s finance chief Nigel Manvell told councillors that “difficult decisions” would be necessary to balance the budget.
But in a report due to be presented to councillors next week, an overspend of £2.8 million is forecast, down from an £11 million prediction in July.
The report said that the council could yet break even by the end of the financial year at the end of March.
But the challenges include rising demand and higher costs for emergency housing, falling parking income and the cost of agency staff.
Since July, a recruitment freeze has been in place across the council, with relatively few exceptions, and stricter controls have limited the use of agency staff.
Other financial controls have included paying suppliers on the due date and not before, with spending not signed off or processed until necessary.
The report said: “The council’s in-year financial position is clearly very challenging but, with the escalating controls now in place and ongoing recovery actions in place across directorates, reaching break-even by year-end is expected to be achievable but there will inevitably be some impacts on service delivery.”
This year’s budget was set in February with a savings target of more than £14 million on top of the previous year’s £10.5 million savings.
The report – to the council’s to Strategy, Finance and City Regeneration Committee – said that over the past 13 years the council had had to make £209 million in savings, with government grant reductions starting in 2009-10.
The report cited “increasing numbers of applicants for emergency accommodation in the first quarter of 2023-24, with an average of 153 households every night … almost three times higher than budgeted”.
The report also said: “This is partly driven by an increase in private property owners selling properties and evicting tenants as a result.
“There is also an increase in the number of households being placed who are fleeing domestic abuse.
“The service is analysing each placement to identify any opportunities to better prevent homelessness and understand the reasons for this.”
The council faces a significant shortfall in parking income – of more than £1 million – while spending more on agency staff for rubbish and recycling rounds and street cleaning.
The council’s Strategy, Finance and City Regeneration Committee is due to meet at Hove Town Hall at 4pm next Thursday (7 December). The meeting is scheduled to be webcast on the council’s website.