Latest on Sunderland City Council budget pressures as it faces £2m overspend
City council chiefs are estimating an approximate £2million overspend this year linked to demand and pressures in areas such as adult and children’s social care.
The update came as the latest meeting of Sunderland City Council’s ruling cabinet received a report looking at the overall revenue budget position for 2024/25 following the third quarterly review.
Councillor Alison Smith, corporate services and equalities portfolio holder, outlined how the local authority is currently estimating a £2.083million overspend for its revenue budget for 2024/25.
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However finance officers noted this an improvement from the expected overspend at the end of quarter two, which was “in excess of £5million.”
Labour’s Cllr Smith, speaking at the latest meeting of cabinet (on Thursday, January 16), highlighted several areas where the council is facing financial pressures, many of which are also impacting other local authorities across the country.
She said: “The council’s social care services continue to experience demand pressures, challenges around complex cases and cost increases from providers looking to mitigate inflationary and other pressures that they are facing.
“The children’s services’ home to school transport continues to see adverse pressures, due to the significant cost increases across all providers of this service and due to the demand for the service.
“The council will continue to seek to reduce the forecast overspend where possible during the remainder of the financial year.”
She added the predicted end of year overspend can be met from the council’s earmarked general inflation and risk reserve.
The meeting heard savings arising from treasury management activity linked to capital programme expenditure reprofiling and increased investment returns have helped reduce the overspend to the estimated £2.083million level.
Savings from reducing energy costs and contingency funding have also assisted the overall position.
Additionally Cllr Smith provided an update on the £7.232million savings initiatives which the budget for 2024/25 was reliant on.
She added 83% are expected to be fully realised, 4% are making good progress, and 13% are experiencing delays and are therefore included in the overspend position.
City council leader, Labour’s Councillor Michael Mordey, praised officers and councillors for “a lot of good work that goes in throughout the year” to deliver the budget and reduce overspends.