Council could dip into reserves to reduce forecasted £9.4m overspend

East Riding of Yorkshire Council says it must consider what steps it will take to avoid an overspend on its core budget at the end of the 2023/24 financial year.

The council warns it has had to cope with an increase in demand for services in adult social care and children’s services.

The rising need for these essential services, along with increased costs due to inflation, means the council now projects an overspend of £9.4m at the end of this financial year.

In response, the council is introducing measures to cut spending, including tighter control of recruitment and re-purposing funding with a focus on priority services.

The council’s cabinet will consider using £4.7m of reserves to help offset the projected overspend, and if agreed by cabinet, the projected overspend will reduce initially to £4.7m.

Further work on using revenue reserves and re-profiling of capital projects is expected to reduce this figure further.

Councillor Nigel Wilkinson, portfolio holder for finance, said: “Our financial position is like most councils, in that demand for services has exceeded funding.

“This is within the context of a cost of living crisis, where inflation is also having a significant impact on our costs.

“We now need to take steps to contain costs within our budget for this financial year, whilst continuing to provide good quality services to residents.

“We are also looking to the future where we expect demand for social care in both children’s services and adult services to continue to increase.”

Cabinet will consider the financial position in the council’s Revenue and Capital Monitoring report on 19 September.