Essex County Council unveils 2023 budget as funding gap could hit £75m

While Essex County Council’s has unveiled a balanced budget for 2023/24, the authority faces a gap between its funding and expenditure of £19 million next year.

A report to go before the council’s cabinet said: “After delivering 100 per cent of all existing planned savings, the gap is expected to be £19 million in 2024/25 rising to £75 million by 2026/27, before further tax rises."

The report, penned by Nicole Wood, the council’s executive director for corporate services, added the council has a “robust savings, income and efficiency programme”, allowing the authority to set a balanced budget for the coming year and make a further £48 million of savings between 2024 and 2027.

Ms Wood added there “remains uncertainty” around the future of Government grants from 2025 onwards.

• READ MORE: Here's how much more you'll be paying in council tax this year under new budget

She said: “There is no confirmation of how the Social Care grant, Services grant, and other grants announced in the provisional settlement, will be allocated from 2024/25 onwards.

“This presents risk to the financial stability of the council, if these grants were to be discontinued, or if the council’s allocation were to reduce.”

The report revealed the council currently spends 65 per cent of its budget – some £1,093 million – on social care and health.

It adds: “During 2022/23 we are experiencing pressure on both adults and children’s services.

“The care market, post Covid continues to struggle with capacity and there is uncertainty around both the timing and financial impact of care reform.

“We are seeing the emergence of significant pressures on children’s services, with rising demand for placements and increasing costs, which is a national issue.

“The unprecedented levels of inflation have caused a significant pressure across services in 2022/23, which is driven by energy costs.”

In its budget, the council outlined how its proposes to spend the £2 billion it is responsible for.

The council plans to invest an extra £68 million into services over the coming year, including £506 million on adult social care - £58 million more than last year.

More than £270 million will be spent on infrastructure projects, including new schools and road improvements, while £200 million will be spent on achieving net zero emission targets.

Budgets for highways and footway maintenance will remain in line with the previous year.

Councillor Chris Whitbread (Image: Essex County Council)

Chris Whitbread, Essex county councillor responsible for finance, said: “In the most channelling economic landscape since WWII, we have had to balance supporting vulnerable or hard-pressed people with the need to keep any council tax increase below inflation and as low as possible.

“We must never forget it is our residents’ money we are spending.

“This year the price of energy has risen, the price of goods and materials has risen and so have interest rates.

“Councils, just like any business or family, are affected by inflation and price rises for goods and services.

“With the changes and reductions in Government grant funding over recent years, coupled with increasing and more complex demand for core services, such as caring for the elderly, protecting vulnerable children and supporting those families who need it, the financial situation continues to be challenging.

“However, our budget proposals are in tune with our residents’ priorities, protecting the most vulnerable in our communities, investing in infrastructure, education and offering value from every pound we spend.”