Northumberland council leader warns of 'difficult decisions' after forecast of £7.9 million overspend

There has been huge increases in recent years on the cost of providing care for both adults and children, and the latest figures show the situation is showing no signs of letting up.

However, senior councillors have insisted there is no cause for significant concern.

The figures came as part of the first quarterly report on the council’s financial situation, and previous years have seen similar overspends predicted at this early stage. However, the local authority has always delivered a balanced budget by the end of April.

Portfolio holder for finance, Cllr Nick Oliver, said: “At the moment, we’re predicting a £7.9m overspend. That might sound a bit alarming, but last year it was £7.5m and we came in on budget. I don’t think this is anything to be alarmed about at this stage.

“Adults continue to be a challenging area, and so do children’s services because of increasing costs and complexity. Council staff are doing a fantastic job to manage these pressures and deliver these services well and efficiently.”

According to the latest figures, adult services are expected to overspend by more than £2.8m, while children’s services are currently forecasting a £869,000 overspend. The regeneration budget is also forecasting an overspend of more than £1m.

Cllr Oliver said that work was ongoing to modernise council services through the BEST efficiency programme.

He continued: “I think we should also probably highlight there is a lot of change going on in the council at the minute. Central to that is the BEST programme which we discuss regularly.

“There are timing difficulties with some of these things. We’re making some significant changes to the way the council works and that doesn’t happen overnight.

“A lot of modernisation is part of the core BEST figure and it is happening in every area across council services. We’re building it into business as usual, it’s just becoming part of the way the council works.

“We can expect a bit of capital reprofiling that happens every year. When budgeting you have to expect the worst-case scenario where everything is delivered quickly and we have to finance it, but in reality projects require planning, working with external partners and match funding – all of these things take time.

“We’re not changing our delivering aspirations, but we are reprofiling some of the capital spending.”

The Government settlement for the council has sparked considerable political debate since it was confirmed at the end of last year. While Labour insist it represents the first real-terms increase in core spending power for years, the Tories say it does not keep up with inflation.

Council leader Glen Sanderson said: “I think we should be really proud of what we have achieved so far. It has been really difficult for us in adult services and some parts of children’s.

“We’re bound to do our very best for these residents but it makes it all very difficult to make the books balanced. We will deal with this over the course of the year.

“There will be some difficult decisions we have to make because we can’t go on providing all the services we do with reducing Government money.”