Happily, Peterborough City Council found sponsors for £56,000 to fund the Christmas lights switch-on this year but away from the tinsel and glitter a huge financial challenge lurks in the shadows. Not least the current overspend which, for the first three months of this financial year for which we have figures, show a projected overspend of £10.3m against the £220m revenue budget.
The same report, released to Cabinet in September, also show the council’s reserves teetering on the brink at £9m “below the level which would deemed adequate and if the position continues on this trajectory reserves balances will not be sufficient to cover any budget gap in the next financial year”.
Among many pressures on the council, here’s just two of them – children and young people and housing.
Children’s Social Care placements costs are forecast £2.5m over budget, Cabinet was told.
The budget was built on an assumption there would be 423 Looked After Children (LAC). At the end of June LAC numbers were 437.
And residential placements have risen from 29 to 42 “which is driving this pressure, due to the higher associated costs”.
There is no further provision for placements if LAC numbers rise as anticipated.
On housing Cabinet was told there were over 100 households currently in B&B accommodation and during the first quarter peaked at 115.
Temporary accommodation was increasingly difficult and “demand and complexity continues to increase over and above previous years, outstripping supply and resulting in suppressing the effect of action plans.
“The directorate is actively looking into measures to address structural overspends and move forward with transformation to realise efficiencies”.
Against this backdrop, and ahead of a looming budget to put together for 2025/26, the city council has been keen to engage residents through a ‘Shaping Our City’ consultation.
Apart from online surveys, senior officers and councillors have attended in person events this month at the Alpha Centre in Adderley, Hampton Centre, Focus Community Centre on Chestnut Avenue.
They also attended a consultation evening at Salvation Army Citadel on Bourges Boulevard, Ormiston Bushfield Academy at Ortongate and Stanground Academy.
There were also meetings in September at Arthur Mellows Village College, Glinton and at Anglia Ruskin University (ARU) Peterborough Campus.
Anecdotal evidence is hard to come by although one resident tells me the “response seems abysmal with just one local resident turning out to hear council top brass at Ormiston Bushfield Academy”.
Another concluded, after attending his local consultation at the Salvation Army Citadel, “I learned that thanks to a combination of debt and the cost of care Peterborough faces savage cuts.
“Yet hardly a dozen people were present, and one was PCC director, another the PCC head of communications, and at least four Labour councillors”.
From what its social media reveals, the city council has done its best to engage with Peterborough residents but lukewarm might be a fair description of visible outcomes.
For example, a post on the ‘Shaping Our City’ Facebook page asked this:
With a predicted overspend of up to £11m in year due to an increase in service demands – particularly around social care, do you agree the council was right in saying the Christmas lights/events would not go ahead unless all £56k was found through sponsorship instead of council money?
A reasonable enough question if off piste from the perilous state of the rest of the council’s finances.
But no matter since 71 per cent of respondents ticked ‘strongly agree’ to the decision, although in fairness total poll respondents was a derisive 56.
You can take a horse to water, but it doesn’t always want to drink!
49 per cent of the 54 respondents felt assured enough to tick ‘agree’ to a question about whether they felt city council projects such as the Station Quarter redevelopment will create more jobs and boost the local economy.
Best response – it attracted 187 – came when the city council asked how important residents felt it for the city council to “build more homes of all sizes and at different price points, including affordable housing”.
75 per cent of respondents agreed it was ‘very important’
Whether the consultations offer anything other than a box ticking exercise remains to be seen but the council has been brutally frank in setting the tone of the crisis it faces.
“Like all local authorities, we continue to face ongoing financial pressures,” it posted to its Facebook page.
“It is essential that we reach and maintain a position of financial sustainability.
“Our net revenue budget is in the region of £220m per annum. The demand for services in the current year and over the life of the Medium Term Financial Strategy is significantly higher.
“This means there is a constant challenge to deliver services within budget.”
It lists some of the key areas driving this pressure, including:
- Interest rates remaining high, impacting on the cost of borrowing
- A rise in demand for services such as children’s social care placements, adult social care packages and temporary accommodation due to homelessness presentations
These challenges include:
- The number of people coming to us for housing support as they’re homeless rose 40% from an average of 51 a week in 2021/22 to 70 a week in 2023/24.
- In the current year, we are expecting to exceed our home to school transport budget by £1.1m due to increasing numbers of children with special education needs and disabilities who require transport to and from school.
- In adult social care, we received 2,580 new requests for support in the last 12 months – 18% more than the previous 12 months.
- The number of children subject to a care plan has doubled since last year (277 in March 2024, 136 in March 2023).
- High interest rates mean we are refinancing debt at much higher rates, which is costing us an extra £2.5m each year.
It added: “We are currently facing an in-year overspend of around £10m. We estimate that the budget gap in 2025/26 could range between £13.2m and £24.3m.
“Peterborough does not have the reserves balances available to fund this overspend. Getting to a balanced position is imperative.
“It is therefore essential that we continue to find ways to transform our services and deliver savings where possible.”
The online consultation ends tomorrow (October 27) and can be accessed here:
Cabinet will consider comments made as part of the consultation at a meeting on 3 December 2024.
