Brighton and Hove City Council on track to overspend budget by £11.6m

This amounts to more than five per cent of the “general fund revenue budget” which was set at £200 million for the 2022-23 financial year from last April to the end of next March.

The reasons include more children in complex care placements, a drop in parking income and a failure to make the savings approved when councillors set the budget in February.

Brighton and Hove City Council voted through savings totalling £10.5 million for 2022-23 but a report to councillors said £5.4 million of those proposed savings were “at risk”.

Rising costs were blamed for almost £4 million of the savings shortfall, while savings of just over £5 million had been achieved.

The report to the policy and resources committee said the projected overspend was “significant” after cuts totalling £10.5 million last year and 11 years of “savings packages” totalling more than £185 million.

The council's targeted budget management forecast has been revealed

When councillors discussed the state of the finances last month, officials announced a recruitment freeze.

In October, councillors agreed to look more closely at spending cuts and possibly putting up fees and charges while pausing some projects.

The latest report said: “The forecast presents a serious financial risk and, if not managed significantly, will severely impact the level of the council’s reserves and balances which would need to be utilised to fund any overspend.”

Parking charges and permits have not brought in as much money as expected this year, with permit income falling short by almost £700,000 as fewer people paid up when prices rose.

• READ MORE: Council warn of 'difficult decisions' amid budget shortfall of £18 million

At the same time, the income from parking charges is falling short by more than £600,000, some of which reflects a loss of parking spaces as a result of “active travel” schemes.

The report to the policy and resources committee projected a year-end revenue shortfall of more than £3.2 million for permits and on-street and off-street parking charges.

At Cityclean, the council’s rubbish and recycling service, the cost of agency staff helped fuel an “overspend of £558,000 … due to vacancies across the service”.

The council will discuss finances later this week

The report said: “Recruitment into vacant posts and managing of attendance should start to see these high agency costs reduce during the year.”

The stink over the closure of public toilets also re-emerged, with the report setting out an overspend of £137,000 “due to greater than budgeted utility costs, consumables and staffing required to maintain cleaning levels”.

In children’s services, home to school transport is forecast to overspend by more than £1.2 million while the projected overspend for children’s placement is more than £1.5 million.

The number of children in care has risen nine per cent since 2020 – and more children in care have more complex needs, resulting in expensive placements costing an average of almost £13,500 a week.

The report said: “The post-pandemic period has seen children with increasingly complex needs as well as problems in foster care recruitment causing an acute sufficiency issue, making placing children in families either in-house or with external providers is very difficult."

The financial outlook is expected to be discussed by the committee on Thursday.