Six major issues that are 'challenging' for Solihull Council as latest finance update revealed

The hole in the finances at Solihull Council has reduced but the overall picture still remains challenging. That is the update members of a scrutiny board at the authority have been given ahead of the authority setting its budget early next year.

As previously reported, Ian Courts, the leader of Solihull Council, made appeals to government for support as the revenue forecast, to the end of the financial year (April 2025), had been showing a hole in the authority’s finances of £7.7 million. In a summary of the latest position to the authority’s resources and delivering value scrutiny board the current forecast is now showing the deficit to be £6.8 million.

Officers in their report write: “Since this position was reported to cabinet in September, the forecast has improved from £7.6 million to £6.8 million. The council has recently introduced internal spending controls which are now in place to provide some mitigation against this adverse variance.”

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But officers warn the outlook on local government finance “continues to be particularly challenging”, highlighting areas including:

• A newly elected government where it is currently unclear what the changes will mean for local government

• The ongoing delay to local government finance reform and associated uncertainty over future funding streams

• Cost of living impacts on pay awards and other contractual costs

• Children’s, education (SEND) and adult social care – further demand pressures

• Long term reform of adult social care

• Business rate fluctuations

Officers add: “It is clear from (those) combination of factors that the budget process for 2025/26 will be even more challenging than last year. The council may also need to accept more risk in the budget assumptions.”

As recently reported Chancellor Rachel Reeves announced an additional £1.3 billion of grant funding for local authorities, including at least £600 million for social care services, in Labour's first budget since being elected. Following that the leader said there were “positive aspects” to the budget, but added: “I cannot see that anything has yet scratched the surface of the financial problems local government is currently facing, bearing in mind the 22 per cent cut in core spending power over the years.”

The board’s meeting is being held at the Civic Suite on Monday, November 11. The meeting starts at 6pm and is open to the public.