Rotherham Council’s finance bosses have reportedly warned the councilors that the authority is currently facing a forecast 7.7 m £ funding black hole during the upcoming financial year.
Finance Directors Warn Rotherham Council Of A £7.7 Million Budget Black Hole
The largest department known for overspending is the Children and Young People’s Services with a forecast spend of a total of 3.6 Million £ over budget. Regeneration and Environment Services are currently facing a 3 Million £ overspend.1 Million £ of the total overspending relates directly to the wider financial impact of the ongoing war between Russia and Ukraine. This has reportedly increased inflation as well as energy prices.
RMBC had to make a total of 11.5 Million £ of savings which includes reductions in the social care teams which are linked to reducing caseloads as well as reablement services. The Cost reductions from the council’s buildings as well as the increased income from Waleswood, too add to the total spending.
A financial update that was presented to the Rotherham Council’s cabinet on Monday, July 11 puts the overspending down to the inflation and price increases which is caused by the COVID-19 pandemic and the Russia – Ukraine war. It also adds that the placement pressures and the school transport pressures are together straining the budgets for the children and the young people’s services and regeneration as well as the environment.
The report further says that the forecast position in the future will be continued to be closely monitored and mitigations are identified to enable a balanced outturn position delivery. However, it is estimated that the Council will need to call on its reserves to achieve a balanced outturn position. Saghir Alam who is the Councilor and cabinet member for corporate services, community safety, and finance told the meeting, “This financial report is for the first two months of the year. The Rotherham council currently estimates a directorate overspent of £7.7 million for the financial year up to May 2022.
Some of the other pressures on the budget for children and young people are because of the increase in the placement costs for the looked-after children. Apart from this reduction in the dedicated schools grant due to a reduction in education placements is also seen as one of the reasons for the increasing pressure. Victoria Cusworth who is the Councilor and cabinet member for children and young people’s services said that further placement pressures were all due to the growth in independent fostering agencies recruiting foster careers and they not recruiting in-house.
About Rotherham Council
The Rotherham Council which is formally known as the Metropolitan Borough Council is the local authority of the Metropolitan Borough of Rotherham which is in Southern Yorkshire, England. Rotherham council is one of the total four councils in South Yorkshire and one of the 36 in the metropolitan counties of England. This council was created by the Local Government Act in 1972. The council’s powers were suspended and transferred to the commissioners who were appointed by the HM Government following the severe criticism of the Casey report into the Rotherham child sexual exploitation scandal in February 2015. The taken power was being returned to the council in phases.