Leicestershire County Council is considering how to deliver services differently as forecasts show its budget gap could top £85m by 2028.
Published today (Wednesday), the authority’s four-year proposals include investing £127m more to meet growing demand, mainly in social care, and an extra £113m to cover inflation and the National Living Wage increase.
A three per cent Council Tax increase for our core services is planned for next year, generating £11m for front line services. A further £7m will be raised from a two per cent increase in the adult social care precept.
Spiralling social care prices, growing service demand and inflation are driving up costs for councils across the country and means that for the first time, it’s planned to use up to £12m of reserves to help balance the books next year.
Pressures include:
- Surging cost of placements for children in care - with costs for just 10 children with complex needs now reaching £5m
- A 56 per cent rise in unaccompanied asylum seeking children in care and care leavers since last year
- Over £220m of net inflation and service pressures across the next four years - compared to £100m of increased income (including Council Tax)
Major redesigns of children’s and adults’ social care are already underway to bring down future demand and costs by millions-of-pounds, such as creating more new placements locally, rolling out new technology and helping more people live independently.
Controls around recruitment, procurement and other spend have also been tightened up to help bring down the council’s budget gap.
Councils are facing their toughest ever budget challenge. Although we are not in crisis, we have to tackle the 20 per cent gap between expenditure and income, so need to deliver services differently.
Supporting vulnerable people remains our priority. And with costs and demand rocketing, it’s crucial we continue to transform how we work whilst also getting people the help they need.
We’re low funded, very efficient and high performing. But the Government’s autumn statement was dire for councils, with no extra funding and the national living wage increase alone adding £20m to our costs.
From stepping up finance controls, to making sure we’re not subsidising other organisations’ services, we’re doing everything we can to bring down our significant budget gap. Using our reserves to help make ends meet is clearly not sustainable.
Person:Declan Keegan, the council's director of corporate resources
A three per cent Council Tax increase for a Band D home equates to 88p a week for core services – and a two per cent rise for adult social care is equivalent to 58p a week.
The four-year budget plan includes:
- A £12m budget shortfall next year – rising to £33m in 2026, £60m in 2027 and £85m in 2028
- £127m more to support vulnerable people – to pay for more home and residential care, and support people with physical disabilities, learning disabilities and mental health needs
- Major redesigns of services to manage future demand, including:
- Special educational needs and disabilities - a new approach balancing growing demand for support with getting children the right help
- Working with Barnardo’s to run children’s homes locally
- Boosting ‘supported living’ - over 100 new placements created since 2020, enabling people with learning and physical disabilities and mental health needs to learn life skills and live independently
- Rolling out ‘care technology’ - over 2,600 pieces of equipment, including falls detectors and GPS location trackers, installed over last year, benefiting over 1,000 people
- £36m of savings – including redesigning services, reducing the cost of back-office support services by maximising digital technology and smarter procurement
- A £445m four-year capital pot - for the cost of building roads, schools and other one-off projects linked to new homes being built across Leicestershire.
Closing the budget gap may lead to a reduction of about 200 posts over the next four years - staff turnover and vacancy management will mean that the number of compulsory redundancies will be much lower.
The plan will be discussed by the council’s cabinet on Tuesday (19 December) – watch online.