£21.7 million buffer at Telford & Wrekin Council remains ‘intact’, finance committee told

Some councillors compared the borough’s finances with those of Shropshire Council, which is trying to stave off effective bankruptcy.

Members of Telford & Wrekin Council's business and finance scrutiny committee were presented with a financial monitoring report from July, but a senior council officer gave them a verbal update on Wednesday (September 17).

Michelle Brockway, the council’s statutory chief financial officer, said the council’s ‘budget strategy reserve’ remains at £21.7 million.

“It has been intact for a number of years,” the officer told the committee.

She said the council hasn’t had to dip into the reserve “yet” despite massive increases in the costs of adult social care.

The committee was told that if its financial monitoring finds increasing spending the council can look to allocate more from other reserves and contingencies, and can make “in-year savings”.

Various council pots put aside in this year’s budget have already been allocated to soak up an anticipated £5.6 million of rising in-year adult social care costs.

The rising costs, the council says, relate to the cost of providing care packages across all client groups, market price increases, more complex needs, higher demand, and longer periods of care being required.

Councillor Giles Luter (Labour, Ercall) thanked council officers for “managing to keep us within budget”.

He added: “The reason that money is there is for the curveballs that are thrown at the council.”

Council finance chiefs’ own assessment of the authority’s position is that it is “pursuing a sound financial strategy” in the face of “the most prolonged and challenging financial position it has ever faced”.

Its budget strategy reserve is considered to be at “an adequate level” with an “appropriate medium-term strategy” for the use of reserves.

The meeting was told that there are a number of unknowns on the horizon, including a £4.66 million overspend on the dedicated schools grant.

It is a national issue to do with high needs cases and the council along with others has been allowed to “disregard” it from its accounts.

But the meeting heard that it is possible that in future the council will have to pay back that overspend.

Councillors were told that “stubborn” high inflation and interest rates at 4 per cent were also other factors to consider.

But the council is hopeful that a national-level rejigging of Government grants towards the north of England will mean more for Telford because of its levels of social deprivation.

And the authority is looking at December when may receive a “multi-year” budget settlement from the Government, replacing single-year allocations from Whitehall.