Shropshire Council has already delivered two thirds of its mammoth £51.4 million savings target this year, its finance chief has said.
A new report to councillors says by the end of the first quarter of 2023/24, savings of £34.3m had either been made or were on track to be made, with “further work” needed to achieve the remaining £17.1m.
However, it also reveals unplanned spending on social care has had to be factored in, meaning the authority still risks overspending by up to £37.6m by next April if no extra measures are taken.
The report by James Walton, director of finance, says the savings made in the first three months of the year is more than those achieved in the last three years combined.
It says: “In a challenging year, where other councils have struggled financially, Shropshire Council is robustly managing its finances.”
Addressing the cuts that still need to be made, Mr Walton says: “Further work is needed to deliver the balance of spending reductions to achieve the overall target.
“Additionally, reductions achieved to date are those which are comparatively easier, so the remaining amounts are likely to be more challenging.”
The report estimates around £11.9m of the remaining £17.1m planned savings will be achieved by the end of the year.
Mr Walton also says says the council will identify “short-term funding” to meet the £20.5m extra demand in social care costs.
The council is therefore working on the assumption that it will be left with a £5.2m overspend by next April, which will need to be funded by reserves.
This year’s budget included bolstering the council’s general reserves pot after overspends in recent years saw it plummet to just £7.1m – less than half the minimum recommended level.
The council had planned to bring its reserves back up to £27m this year, meaning a £5.2m overspend would still leave it at £21.8m.
The report says this is “above the lower end of the target range”, which is around £15m to £30m.
The report will be discussed by the authority’s transformation and improvement scrutiny committee on Monday, September 4, before being presented to cabinet later that week.
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