Cuts on the way as Bradford Council faces overspend of £68m

Council officers are currently drawing up cost cutting plans to balance the budget in light of the eye watering figures.

A rising cost of residential care placements for children – on average £312,000 a year a child, is one of the reasons given for the huge overspend.

New financial documents released by the Council today show that halfway through the financial year the Council is facing a £23m overspend.

And the Bradford Children’s Trust, which took over responsibility for Children’s Services in April, is facing a £45m overspend.

Further overspends are expected from the Trust in future years.

The rise means Bradford Council now spends 76 per cent of its budget on social care.

In recent years the Council has plugged its budget gaps by using reserves, but the Quarter 2 financial statement, which goes before the Council’s Executive next Tuesday, says: “It is likely that even with mitigating action to reduce overspends, reserves will be depleted this year.”

In a briefing with the Local Democracy Reporting Service, Bradford Council Leader Susan Hinchcliffe said the authority was not planning to declare bankruptcy like some Councils, but acknowledged cuts needed could lead to reduced services.

She also said the Government’s Autumn statement – expected next month, was a “big day for Bradford” as more support for local Government was vital to balance their books.

Cllr Hinchliffe said: “The overspend is down to several things – particularly the extra demand for children’s and adult’s social care.

“The average spend on children’s placement costs average £312,000 per child.

“Costs of agency social workers remain high, although the trust is working hard to create new ones.

“The Children’s social care budget is £242 million this year. To put that in perspective, the Council brings in £233m from Council Tax.”

We’ve already had to find £350m worth of cuts due to austerity measures since 2010.

“We’re coming up with some more detailed plans to cut more money from the Council’s budget to sustain services going forward and to meet the increasing social care demand.

“We’re not the only Council in the country to have to do this – Councils everywhere are facing a huge financial pressure. We need Government to put more money into Local Authorities.”

Asked what type of cuts might be made, Cllr Hinchliffe said: “We won’t have any firm proposals until December. We’re looking at what services could be stopped or delivered in a different way.

The Council has written to the Department for Levelling Up Housing and Communities and the Department for Education asking for them to help fund the overspend faced by the Children’s Trust.

She said the Trust was well led, but it would take time to deal with the huge financial pressures facing Children’s Services.

Cllr Hinchcliffe said Bradford having high levels of deprivation and a high proportion of young people made the area particularly vulnerable to the rising costs of social care. She said: “In Bradford East and Bradford West around 50 per cent of children are in poverty. There is a high correlation between this and the care system.”

Council Leader Susan Hinchcliffe (Image: newsquest)

She pointed out that 80 per cent of homes in Bradford were in the A or B Council tax band, meaning income is much lower than more affluent areas that have fewer social care pressures.

“Our Council Tax base is the second lowest in Yorkshire and the Humber. It used to be Council Tax covered 33 per cent of all services, with the rest coming from Government. Now it is the other way round.

“In Bradford our lower level of Council Tax is having to go further than ever.”

She argued that something needed to be done on a national level to tackle the issue of rising costs of agency staff and children’s placements, adding: “Businesses should not be making up to 20 per cent profit on the most vulnerable children – that is wrong and needs to be tackled by the Government.”

When asked what the public would think about the Council’s financial woes when the Authority had recently funded multi million pound schemes like Darley Street Market and One City Park, Cllr Hinchcliffe said: “A lot of those schemes are funded by Capital Expenditure rather than Revenue Expenditure, which is very different. We would need to stop a lot of capital schemes to make a small dent in the revenue budget, and a lot of funding for these schemes come from grants from organisations outside of Bradford.

“We have to keep regenerating our economy, there is no way we can reduce spending on social care without creating a better future for young people in Bradford.

“We have things around the corner – mass transit, City of Culture and the new station for Bradford. Things are turning around for Bradford, we just need to keep managing the budget to get through a very difficult time.”

In response to the finance report Councillor Mike Pollard, Conservative spokesman on financial issues said: “I can just about, using a series of heroically optimistic assumptions, model a scenario in which the Council’s Budget could be technically balanced to the end of the current 2023/24 Financial Year.

“However, barring an implausibly generous Autumn Statement by the Chancellor in November and likewise implausible Provisional Local Government Settlement in December, it will be impossible for the Labour Executive to present a balanced Budget for 2024/25.”