Kirklees Council is taking serious action to minimise the impact of a growing economic and cost-of-living crisis.
The council has revealed a £34.4 million budget overspend for the current financial year, money which will be met from the council’s cash reserves.
However, the council is now urgently looking at measures to make savings across the authority including an immediate recruitment freeze on “non-critical” roles and agency staff; a freeze on hiring outside venues for meetings; and extra scrutiny on new expenditure by the executive team.
The council is also mothballing some buildings and encouraging all staff who can to work from home.
The council’s Cabinet will discuss the budget impact at its meeting on Wednesday November 16. The following day the Chancellor of the Exchequer Jeremy Hunt will deliver his Autumn Statement, which is expected to add more pressure to local authority finances.
Sky-rocketing energy prices have added the highest costs to the council’s budget in recent months with nearly £12 million in extra funding needed to heat and light council buildings, schools and leisure centres.
Inflation in goods, services and pay have added a further £10 million to budgets as a result of the national economic crisis. Other increased demands on vital council services make up the rest of the shortfall in the council’s current budget.
The council is taking immediate steps to address the financial challenge in the current year including using its reserves, freezing staff recruitment, rationalising the number of buildings it uses and cutting expenses that aren’t critical to frontline services.
Councillors say that the Government’s Autumn Statement, alongside the local government settlement expected in December, will be critical to determining the financial future for councils and services across the country.
The Autumn Statement will give an indication of available spending for all public services over the coming years with the financial settlement setting out funding for each council in the country.
Council leader Clr Shabir Pandor said: “The cost-of-living crisis and the wider economic emergency have hit Kirklees residents hard. We are now seeing the impact on budgets for council services. It means we are facing significant pressures on our budgets.
“We’re taking immediate action to reduce our costs and bring the deficit down but it’s the Government announcements on public spending, expected over the next few weeks, which will be even more crucial. They will set the scene for the decisions we need to take on future budgets.
“In my national role with the Local Government Association, I talk to council leaders across the country and it’s abundantly clear how serious the situation is for virtually every local authority.
“Councils across the whole country are facing unprecedented pressure on budgets now and even more severe challenges in the years ahead.”
Clr Paul Davies, Cabinet member for corporate services, said: “This is a council that’s been prudent with the public’s money over many years and we are in a better position than many local authorities, some of whom have signalled that they are headed for a financial cliff edge.
“But we need to put the council’s finances on a sustainable footing and we’re taking action to do that. Frontline services for residents are our absolute priority and we are focusing our response on protecting them.
“That means using the council’s reserves to offset some of our increased costs as well as reducing staff recruitment and looking to rationalise the number of buildings we use for back-office services.
“It’s clear that the economic crisis is going to affect the country beyond the course of the current financial year. That’s why the Government’s Autumn Statement on public service funding and its decisions on funding for councils are so important.
“They will set the backdrop to the decisions we need to take for the next few years. More than ever, Kirklees needs a fair deal from Government that acknowledges the demands on services and the costs we face. Residents deserve nothing less.
“This is a fast-moving situation and I will continue to update residents and councillors on our financial position regularly.
“At the same time, we remain focused on supporting residents who face their own cost-of-living crisis.
“This includes supporting local food banks, distributing the Household Support Fund to families who need it most and working with our voluntary and community sector partners who do such brilliant work across Kirklees.”