Labour-run Kirklees council are currently overspending by approximately £2.8 million per month.
At the recent Full Cabinet, Cllr John Taylor raised this with portfolio holder Cllr Paul Davies and leader Cllr Pandor, who gave a very long and generic response highlighting that no real action has yet been taken.
Commenting, Cllr Taylor said;
Disappointed but not suprised that rather than talk about the actions that the Council could be taking right now to reduce the impact inflation is having on Council budgets, Cllr Pandor just trotted out a series of statistics and complaints.
He says he has stopped all recruitment but then contradicts himself in the same sentence, saying they need to recruit the right people at the right time!
What people need to know is when the administration is going to step up and take the urgent action needed to cut overspends?
Whilst they are navel gazing the Council is overspending by more than £1m a week, over and above it's budget plans.
There is no sense of urgency from this administration and it will be Council tax payers like you and me who will need to pay a higher Council tax next year to cover this.
Full transcript below;
Cllr John Taylor
Recently, the Q2 financial monitoring report indicated in-year pressures circa £34 million caused by a variety of global and national factors.
Quite rightly, in response, the council announced that it would be undertaking a series of actions to mitigate against the impact of these cost increases.
Could the leader indicate what actions have been completed and what the expected impact of the changes achieved to date are expected to be?
Cllr Pandor
Thank you Cllr Taylor. Mr Mayor, what I will do I'll try and provide a summary of what we're doing and then I might need to bring my cabinet member, Cllr Paul Davies in if time permits.
Firstly, there are immediate actions have being taken on the back of the major financial challenges we face. As you’ll know, we are stopping all recruitment and each recruitment process that takes place will need have a robust case to make sure that we are recruiting the right people in the right place and there is a the process for doing that.
We also carried out a complete asset review along with our partners, to make sure that we actually look at every single building. There's also a cost reduction exercise taking place. For example, in agency spending we are halting. We reviewing the capital plan and we are also looking at how we utilise our reserves in a efficient and prudent manner.
Prior to the announcement, the government made the LG on a cross-party basis and did a number of actions because council tax by itself is not a solution. We have to put a solid case to government. 14th October 2022, on a cross-party basis, all the leaders at the LGA jointly wrote to the Prime Minister, Rishi Sunak and the Chancellor, Jeremy Hunt, to put our case forward.
We've also launched a campaign around Save Local Services, which has identified 800 services that local government delivers and the case is very, very clear, Mr Deputy Mayor, a long term settlement is needed now, more so than ever. The LGA submission to inform government fiscal plan was also submitted, and the kind of thing we talked about was after a decade of cuts from 2010 to 2020 local government has lost £15 billion from its baseline budgets across that’s across all local authorities.
At the same time, what we did was we actually submitted a proposal which identified a in-year gap of £2.4 billion and for that was £34 million at that moment in time. That was based on an 8% inflation increase. And as we know, the inflation rate is now around 11%. So the figure has already inflated. Next year it's going to be £3.4 billion deficit for local government and the year after 24-25, £4.5 billion.
On top of that, Mr. Deputy Mayor, adult social care sticking plaster solution is now wearing very thin. We've got a £6.45 billion deficit to make sure that we just keep our services at standstill bearing in mind we've got massive cost pressures on top of massive demand pressures. Children's services, in the last five years, Mr Deputy Mayor, has had a cost pressure increase of 25%.
That is a massive increase that we are seeing go up year on year. Just to maintain children's services at the level it is at the moment, will need an additional £1.6 billion. That is quite worrying when theres no more money. What I will do now Mr Deputy Mayor, if there is anything else to add, Paul, can I ask you to?
Cllr Davies
You've covered some of the key areas. Certainly all the actions we identified last month have been put in place and we're moving forward with the recruitment freeze and said, review of council buildings and reductions and other expenses. And I think we're all aware that has been noted from the Q2 report that we expect these actions to achieve £4 million savings in-year.
This will go alongside other actions we've been taking, such as review in the capital program and of course deploying our reserves. And again, you know, the fact that that we at this point have sufficient reserves is a testament to this administration holding firm, certainly in recent years and not spending those reserves on other areas that we did not need to do at that particular point.
Certainly, we're in a position where the government delayed or delivered its autumn statement, that statement, it was very clear that there would be no additional support coming to us as local authorities. As the leaders outlined, that is putting huge pressures on all authorities, including ourselves and unfortunately is pushing us into tough decisions for years to come.
We've been completely open about the major financial challenge and will continue to take actions on staffing, buildings and investment to do all we can to mitigate the issues that we’re facing.
Deputy Mayor
Thank you. Supplementary, Cllr Taylor.
Cllr John Taylor
Thank you for the extensive response, but I don't think you’ve actually answered the question.
You indicated there's been discussions with leaders of the various parties about some proposals that were coming forward, including closing buildings. I'm not aware those buildings have yet been closed because the longer we take before we take the actions, the more money that's burning.
I know they're unpalatable decisions. I appreciate that. I think we all appreciate that. This isn't something that we as a council have on our own, it's something that is shared across the country. But the longer we take to take the decisions, the more money that is burning and therefore the bigger problem that we're creating for ourselves.
So I don't get a sense of the urgency that we certainly had when we were dealing with the pandemic where the council came together and we worked collectively to solve problems.
I don't see that same and I'd like to see some more urgency from the administration taking the decisions that need to be taken so that we get - we're not going to solve the problem, but at least we can minimise the impact, but we're not doing that at the moment.
The decisions that are being taken need to be taken and actions put in place.
Thank you, Mr. Mayor.
Cllr Davies
I'm certainly going to assure Cllr Taylor that action is being taken with the greatest urgency possible and I think that's evident to everybody in this chamber who's listened to the feedback that we've given on our finances and the feedback on our action plans. In terms of assets and buildings, that review is due in January and therefore, we'll be taking decisions based on that review in January.
There is constant review of this. You know, certainly it is something and I'm just looking at the chief exec who's, you know, I'm sure having many sleepless nights on this one, because this is constant review on a weekly basis with our executive team and of course, with myself as a portfolio holder again, that same engagement and also, you know, as a Cabinet, we are having increasingly now more frequent discussions around the progress and how we are moving forward on the issues we facing.
So there is absolute urgency. If there wasn't, we'd be sitting back saying very little and not sharing that much. So certainly you could take take it from me that nobody's sitting back, nobody's complacent. And in fact, we are determined to meet the challenges that we have got and, you know, if unfortunately, there are really tough decisions that would be taken in a measured and proper way.
