Northamptonshire trebles deficit projection

16 Aug 19

Crisis-hit Northamptonshire County Council is facing more financial hardship as its projected deficit more than tripled in six months.

The council’s updated medium term financial plan, published this week, puts the deficit for 2020-21 at £34.9m - up from £11.2m in February this year.

Northamptonshire’s increased deficit comes just five months after commissioners said the council could lift its Section 114 notice, which banned all non-essential spending. The notice was subsequently lifted on 1 April 2019.

The task of overturning this deficit will be handed to incoming finance director and Section 151 officer Barry Scarr, following the resignation of Ian Duncan after 12 months at the council. Duncan will step down next month.

Council leader Matt Golby blamed the increased deficit on “additional population and service demand pressures and revised expenditure and inflation forecasts”.

Golby also claimed that a recent damning Ofsted report on its children’s services contributed to its worsening financial position.

He added: “There is also need to further strengthen the council’s financial and governance reorganisation and a requirement to improve children’s services following feedback from Ofsted.

“The council will work towards addressing this budget gap immediately and as such will continue to provide existing services in the most cost effective way through service redesign and increased use of technology; supporting local partners to deliver local services and prioritising needs-based statutory services.”

The council admitted that its financial position remains “fragile” and is yet to make a “full financial recovery” despite an overall underspend in 2018-19.

Adult and children’s services are “volatile in nature and increasing year on year”, which is putting the council’s finances at risk, the document said.

It added: “There are also internal capacity constraints in service delivery which are currently being addressed.

“The council is faced with a requirement to live within its means, improve and transform services and prepare for local government reorganisation, whilst still operating in an environment of government resource constraints.”

The council has been granted special measures to balance its budget including increasing council tax above normal rates and the sale and leaseback of its headquarters.

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