Balanced budget possible with clear management action, despite significant pressures
Shropshire Council’s financial monitoring report for the first three months of 2024/25 shows significant pressure to its budget, like councils all over the UK, and details clear action underway to manage this pressure.
The report includes financial information to June 30 and forecasts that, by the end of March 2025, the council could exceed its overall budget by £38.5m.
The forecast is based on the most likely outcomes of a range of risk factors over the remaining nine months of the financial year and the overspend would be covered by making use of the council’s general fund reserves, which currently stand at £38.8m.
In February 2024, Shropshire Council agreed a savings target of £62.5m for the financial year. The latest report shows 53% of this amount, as well as unachieved savings from previous years and additional savings linked to managing demand for services, is already projected to be delivered.
Much of the forecast overspending is from planned savings still to be implemented or confirmed.
The report, published for the council’s transformation and improvement overview and scrutiny committee, is the first quarterly report of the year and provides more detailed information than previous monthly reports.
Gwilym Butler, Shropshire Council’s cabinet member for finance and corporate resources, said:
“Our quarter 1 financial monitoring report shows the scale of the challenge we face in Shropshire, just like councils all over the UK, as demand for services like social care and housing continues to grow.
“We can balance the books by keeping our savings plans on track using our general fund reserves as needed, but there is no room for error or delay. We have a track record of reducing forecast overspending throughout the year and, with nine months left to report on, will have a clearer picture of our overall position in the coming months.
“We have been clear about the difficult decisions we must make as part of the medium-term financial strategy agreed by the Council in February, the pressure from previous years’ savings that were made on a one-off basis and growing demand for our services.
“Since the budget information was collected for this report, every service the council provides has started a further rigorous review process, to find out what else can be done to make the remaining savings we legally must make.
“Whilst the pressure to make these savings is urgent we must make sure that the difficult decisions we make are the right decisions, not just to balance the books this year but also to ensure we become the modern, sustainable and efficient council we need to be to continue delivering The Shropshire Plan for our communities.”
