Nottinghamshire County Council's multi-million black hole 'worsened' since Budget issued

Nottinghamshire County Council's financial black hole has risen by millions of pounds since Rachel Reeves' first budget. The Conservative-run authority had been predicting a minimum budget gap of £58 million over the next three years.

Following the Chancellor's budget on October 30, this figure has now risen to £64 million. Even if the county council raises council tax by the maximum amount allowed, which senior figures say they are "reluctant" to do, the budget deficit could still be £16 million in the coming years.

The predictions come as the council prepares its budget for the next financial year, starting in April 2025. Although confident that the predicted deficit numbers will come down by February, when final budget plans will be laid out, top councillors say government announcements have created "additional pressure".

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Speaking at a cabinet meeting on Thursday (November 7), Councillor Richard Jackson, the cabinet member for finance, said: "As is usually the case, in the week or so since the budget, details emerged and the picture sort of worsened as detail has emerged.

"There are still several unknowns, the biggest of which is obviously the council's funding settlement which we usually receive right at the end of December. Figures will crystallise further once we've got those figures and worked through them."

Councillor Jackson welcomed several elements of the national budget, including extra money for social care, a return to multi-year funding settlements for councils, more money for road maintenance and a funding boost for Special Educational Needs and Disabilities (SEND) services. Yet the finance chief said the increase in the national living wage to £12.21 an hour alone will create pressure of £18.3 million for home and residential care services.

Combined with changes to national insurance, Councillor Jackson described a risk that some care providers may go under and that other suppliers will pass on extra costs to the council. This is what therefore led Councillor Jackson to share the "headline figure" of a gross £64 million predicted gap over the next three years.

The council's budget deficit could have reached as high as £76 million if the national living wage had been increased to £12.39 an hour, the highest amount forecast by the council. The predicted budget gap is much higher than just a year ago, when the council predicted in September 2023 that its deficit in the coming years would be £30.8 million.

Councillor Kate Foale, the leader of the Labour group of councillors at the county council, says the Conservatives are not being honest when blaming Rachel Reeves' budget for their financial woes. Councillor Foale said in a statement after Thursday's meeting: "The Conservatives have been in charge of the county council since 2017.

"Throughout that time, they have failed to be transparent about the effect of Tory cuts on the council's finances and the impact on our residents. It is no coincidence that they have waited for a Labour government before being honest with the public, as it gives them another opportunity to play politics with taxpayers' money.

"This announcement shows that, no matter whether it's in parliament or County Hall, the Conservatives cannot be trusted with the public finances." Yet Ben Bradley, who will step down as county council leader in December, added at Thursday's cabinet meeting: "We had a gap, we now have a bigger gap as a result of the government's announcements last week.

"We've done an awful lot of work over a number of years to transform services, to mitigate demand and to be as efficient and effective as we possibly can as an authority. This had added additional pressure and we are going to have to have some of those conversations in the coming weeks to understand the impact of that."