A SHORTFALL of more than £30 million has emerged due to ‘severe financial pressures’ caused by a succession of unprecedented events despite a significant upturn in funding from the UK government, the leader of North Yorkshire County Council (NYCC) has warned.
Almost £60 billion in funding will be provided to councils in England for the next financial year, as confirmed by the government.
The announcement, which was unveiled this week by Levelling Up Secretary Michael Gove, means that councils across the country will benefit from an additional £5 billion – a nine per cent increase on last year’s settlement assuming that local authorities increase council tax to the maximum level allowed.
The new unitary North Yorkshire Council, which launches on April 1, will see an increase of £22 million in additional funding from the Government in the 2023/24 financial year.
A NYCC spokesperson said this funding is principally to respond to the massive increase in social care costs and to assist in getting people out of hospitals more quickly.
The spokesperson, however, added that there is an estimated shortfall of more than £30 million in the new council’s budget for the next financial year - the majority of which will have to be covered by the one-off use of reserves as well as some savings.
In the longer term, the financial gap is expected to widen and will need to be met by additional savings.
The new council will be working on a detailed plan for a major strategy to balance the authority’s books.
NYCC’s, Cllr Carl Les, who will also become the leader of North Yorkshire Council, said: “We are faced with the biggest financial pressures which I have witnessed in all of the time I have been a member of the county council since I was elected more than 20 years ago.
“While the extra funding from the Government is extremely welcome, it will still not be enough to alleviate the extraordinary challenges which we do need to tackle in the coming financial year."
The NYCC spokesperson explained that ‘significant overspends’ are already being reported in each of the county council’s service directorates.
They said the health and adult services directorate is being faced with huge pressure from increased demand, especially for adult social care as well as inflation, and its existing £7.9 million in contingency funding has already been allocated.
The government has announced that nearly £18.5 million in grant funding will be given to North Yorkshire to ease the pressures on the county’s adult social care services.
The scale of the new North Yorkshire Council’s operations will see it have an overall spend of about £1.4 billion, including £343 million on schools.
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