Councillors warned cost of living crisis could leave £10 million hole in West Northamptonshire budget

Supporting children in care, vulnerable adults, and those needing temporary accommodation are areas likely to see “unpredicted shortfall”
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Councillors vowed to protect services after being warned the cost of living crisis could leave a £10 million hole in West Northamptonshire finances.

The Tory-run council says it is taking “precautionary steps to deal with a fresh wave of significant financial challenges”.

These include memos to staff outlining the need for immediate action to start heading off issues, tighter spending controls and a major review of existing budgets to see where savings and efficiencies can be made.

Cllr Malcolm Longley says West Northamptonshire is facing a "fresh wave of financial challenges which no-one could have predicted"Cllr Malcolm Longley says West Northamptonshire is facing a "fresh wave of financial challenges which no-one could have predicted"
Cllr Malcolm Longley says West Northamptonshire is facing a "fresh wave of financial challenges which no-one could have predicted"

Finance officers are currently working through the figures to confirm the authority’s future financial projections but a report to the council's cabinet and scrutiny committee later this month is expected to predict a deficit in the range of between £5 million and £10 million by April next year.

Work the council does in supporting children in care, vulnerable adults, and those needing temporary accommodation are areas likely to see an “unpredicted shortfall”.

Councillor Malcolm Longley, cabinet member for finance, said: “Having initially balanced the books in our first year, stabilising services and progressing towards post-pandemic recovery, we find ourselves facing a fresh wave of financial challenges which no one could have predicted.

“We are not alone in this, with many other councils finding themselves in a similar, if not worse position.

“We need to act now to start addressing the scale of the challenge ahead in ways that protect services as a priority.

“We have managed our finances robustly and prudently, learning lessons from the legacy of the previous local authorities and we will build on this strong start and act now to tackle these emerging pressures head on.

“A financial review is under way across the authority and we’re putting tighter spending controls in place as early as possible to help mitigate these issues.

“We will also be looking at additional ways we can work more efficiently and differently to help save money and our staff will be playing an important role in supporting this work.”

Rocketing inflation and soaring energy bills are affecting the local authority just as residents are suffering.

UK inflation hit 10.1 percent last month and is expected to go even higher when the latest figures are revealed by the Office for National Statistics on September 14 with some experts predicting the rate could reach 22 percent next year.

And last week's energy price cap announcement adds around 80 percent to gas and electricity bills from October 1.

The Local Government Association warned earlier this year councils are facing a “perfect storm” with demand for services continuing to rise just as the price of providing them is also escalating dramatically.

West Northamptonshire agreed a £342.2 million budget for the 2022-23 financial year — excluding grant funded schools expenditure of £411.2 million.

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Councillors pledged around £9.77 million raised through a average 2.99 percent average increase in council tax would be used to fund additional investment in refuse and recycling, promotion of bus services and investment in sustainability.

At the time, Cllr Longley confirmed the council’s £9.7 million contingency fund would help mitigate against “potential uncertainties”.