Oh boy, things are not looking good for the Leicester City Council. The mayor, Sir Peter Soulsby, has come out and said that the council is on the brink of a financial crisis. Yikes! According to Sir Peter, the council is facing some serious budgetary problems. He even went as far as to say that they could be looking at effective bankruptcy within the next 18 months. That’s not good news at all.
Sir Peter has taken matters into his own hands and has written a letter to Michael Gove, the Secretary of State for Levelling Up, Housing and Communities, asking for help. He’s hoping that the government can step in and help the council balance the books in 2025-26. Let’s hope they can work something out.
In response to Sir Peter’s letter, the government has said that they are ready to talk to any council that is concerned about its financial position. They even provided an additional £32 million to Leicester this year. That’s a lot of money, but it might not be enough to solve all of the council’s problems.
Sir Peter is not taking any chances. He believes that it is almost inevitable that the council will have to issue a section 114 notice before setting its budget for 2025-26. Now, you might be wondering what a section 114 notice is. Well, it’s basically a report that is issued by a council’s finance officer when they can’t balance their budget. It’s a sign that things are not going well financially.
The council has some serious financial challenges ahead. According to Sir Peter, their reserve to support the budget stood at £66 million as of 31 March 2023. But that’s not enough. The budget for 2023/24 commits £34 million to support spending. And things are only going to get worse. By 2025, social care is expected to cost an extra £50 million a year. That’s a lot of money that the council needs to find.
Amy Oliver, the director of finance for the council, said that they are facing unprecedented financial pressures. She even said that if the cost of social care continues to go up, the government will need to provide more money or other services will have to be cut. It’s a tough situation for everyone involved.
Sir Peter is really worried about what will happen if the council has to issue a section 114 notice. He said that it would be dreadful. It would mean that the council would have to make some tough decisions and cut back on services like parks, sports, museums, libraries, and theatres. All the things that make Leicester a great place to live would be at risk.
The government, on the other hand, is saying that they have already provided a lot of funding to local authorities. They have made £5.1 billion of extra funding available through the Local Government Finance Settlement. For Leicester City Council, this represents an increase in Core Spending Power of up to £32 million or 9.9%. That’s a significant amount of money, but it might not be enough to solve all of the council’s problems.
It’s a tough situation for the Leicester City Council. They are facing a financial crisis and they need help. Let’s hope that the government can step in and find a solution. The people of Leicester deserve better.
+ There are no comments
Add yours