Hartlepool Borough Council fears £5m budget deficit as it begins debating next year's council tax bills

Hartlepool Borough Council officers have outlined how they may have to tackle an initial deficit of £5.256million for the authority’s 2024-25 budget.

The latest finance and policy committee meeting heard key issues leading to the funding gap include the ongoing national energy crisis along with children’s social care and waste disposal pressures.

This includes an increasing number of children in council care needing external placements in recent years.

The average weekly costs for these placements have also risen by nearly 50%.

Meanwhile, the council is expecting to see fees linked to current waste disposal contracts “step up significantly” when they are renewed for 2025-26.

This deficit for 2024-25 would reduce to £2.845million if the core council tax is increased by 3% and a 2% adult social care precept was approved.

This would all be in line with current expected government recommendations.

Final decisions on the next annual budget and council tax will not be made until early next year.

Yet finance chiefs have warned of the pressures ahead and the desire to move away from using council reserves to balance figures.

James Magog, council director of finance, IT and digital, said: “Government have certainly recognised adult social care pressures in recent years. I think they’re just starting to recognise children’s social care pressures.

“Clearly the ongoing use of reserves is not a sustainable position.

“Over the coming two or three years we need to get to a situation where we are balancing the budget without using reserves, I think that needs to be the clear aim of the council.”

The meeting heard the council currently has just under £5million in its dedicated budget support reserve after £1.471m was earmarked to balance the 2023-24 budget.

Councillor Ged Hall noted the amount of cash the council has received from the Government in non ring-fenced grant funding since 2013-14 has dropped from £46.8million to £24.4million.

Mr Magog noted since this time the Government has increasingly shifted the burden of funding council services to local authorities themselves through expected council tax increases.

He added until the long-awaited fair funding review takes place “Hartlepool will continue to lose out” under such arrangements.