Shropshire Council finishes financial year £34m over budget
Shropshire Council has confirmed the extent of its multi-million pound budget overspend.
Figures which have been revealed ahead of a cabinet meeting show that the council ended 2024/25 £34 million over budget.
But papers prepared for the meeting show the council also managed to make just over £47 million in savings in the same year.
Ahead of the cabinet meeting the authority said the savings - making up around 18 per cent of the council’s net budget - represent one of the highest figures of any English council.
At its meeting in February the council agreed plans to try and cut £60m from its budget - £19 million of spending this year - along with savings not achieved last year.
The council has now confirmed that the final budget position mirrors the forecast from the spring.
It has also repeated the previously raised issue over the increasing costs of children and adult's social care - saying the rise is driving the overspend.
A report to the council’s Transformation and Improvement Overview and Scrutiny Committee and its cabinet cite examples including a 28 per cent increase in the number of residential care placements for children, growing numbers of children with education, care and health plans who need transport to special education, and rising costs of adult care placements.
It says the situation is compounded by falling income levels due to lower than expected NHS funding.
The council says that the services under the former 'Place' directorate also recorded a 'significant overspend'.
The report warns that the council’s financial position has only been made possible by using reserves, money it keeps for emergency situations including some earmarked for other uses, to balance the budget.
The council’s General Fund Balance ended the year under £5 million, below the level considered appropriate for a council of Shropshire’s size. In the new financial year efforts will be made to increase the level of reserves with the ultimate aim of increasing them to a minimum level of £15 million.
Councillor Roger Evans, Shropshire Council’s cabinet member for finance, said: “The year-end position further underlines the near impossible situation the council faces. We already know almost £4 in every £5 we spend goes on protecting the most vulnerable in our county – children and adults who we must by law provide social care for.
“Despite our hard-working officers making record levels of savings last year, proportionately more than any other council, this pressure will only continue and with an ever-ageing population requiring more care, the situation will not improve.
“We are re-examining the budget and are working on plans to achieve the savings we must make to bring the budget back into balance and replenish reserves to a minimum safe level. To do this requires more tough decisions and likely some reductions in service or people needing to pay more for some other services.
“To do this we are also pushing the Government to change how it funds social care and to stop penalising large sparsely populated counties like Shropshire, as this year’s settlement did, where it costs more to run many services.”
