Council faces 'real crisis' over £23m budget gap

Leicestershire County Council has warned it may not be able to balance its books next year with its spending set to outstrip its income by £23m.

The Reform UK-led authority has said it will need to use its financial reserves to plug the gap as it predicts it will have to spend about £656m with only £633m of funding available.

Council leader Dan Harrison said the council faced "a real crisis" with that gap expected to rise to £106m by 2030.

He said his administration, formed in May, was still assuming it would increase its share of council tax by 3% from April, rather than the 5% allowed under government capping.

Harrison said Reform's aspiration was to freeze council tax but that conditions were "unlikely to allow for that next year".

In November, external consultants were asked to carry out an efficiency review aimed at cutting millions of pounds of the authority's spending.

The council said those efforts were at an early stage and would focus largely on cutting the costs of providing social care and packages for children with special educational needs and disabilities (SEND).

Harrison said the consultants were making progress and had identified £1m of savings to close the deficit.

"I'm sitting here with a massive problem," Harrison said.

"It's a real crisis in a way, but I'm confident we can deal with it."

If the council increases its precept by 3% from April, bills for Band D properties will rise by £50.45 a year.

That would go up by £84.08 a year with a 5% rise.

Leader of the Conservative opposition group on the council, Deborah Taylor, said: "Before the elections in May, Reform was saying it would reduce council tax.

"Now it's saying it is probably going up by at least 3%, and based on what the finance officers are reporting, it will probably be 5%.

"They say their efficiency review has found £1m of savings, but they paid consultants £1.4m to do it, so they still need £400,000 to break even.

"The council's spent 10 years cutting costs and I don't think the review will find much more."

She described Reform's budget plans as "wishy-washy".

Reform UK cabinet member for resources, Harrison Fowler, said cutting council tax remained a long-term aim.

"That's what we were elected on and we do stand by that.

"It's just a case of analysing the numbers and dealing with the cards we have been dealt at the moment, but that doesn't change our ambitions long-term," he said.

The council's cabinet is set to discuss the budget on Tuesday and will launch a public consultation on it the following day.

Councillors will vote on the proposals in February.

Reform does not have an overall majority in the council chamber and the Liberal Democrat opposition members have said they could block a budget with heavy cuts to public services.

Follow BBC Leicester on Facebook, external, on X, external, or on Instagram, external. Send your story ideas to eastmidsnews@bbc.co.uk, external or via WhatsApp, external on 0808 100 2210.