North Yorkshire County Council share financial challenges despite major increase in Government funding

A shortfall of more than £30 million has emerged due to severe financial pressures caused by a succession of unprecedented events despite a significant upturn in funding from the Government.

The Government has confirmed that almost £60 billion in funding will be provided to councils in England for the next financial year.

The announcement, which was unveiled this week by Levelling Up Secretary Michael Gove, means that councils across the country will benefit from an additional £5 billion – a nine per cent increase on last year’s settlement assuming that local authorities increase council tax to the maximum level allowed.Councillor Carl Les, who will assume the leadership of the new North Yorkshire Council, said: “We are faced with the biggest financial pressures which I have witnessed in all of the time I have been a member of the county council since I was elected more than 20 years ago.

“While the extra funding from the Government is extremely welcome, it will not be enough to alleviate the extraordinary challenges which we do need to tackle in the coming financial year.

“The pressure on budgets will be felt across all of the directorates which provide key services for the hundreds of thousands of people who live and work in North Yorkshire.

“However, we are committed to ensuring that we can continue to provide the best possible services to the public in the face of these immense financial challenges.”

The new North Yorkshire Council, which launches on April 1, will see an increase of £22 million in additional funding from the Government in the 2023/24 financial year.

Nearly £18.5 million in grant funding will be given to North Yorkshire to ease the pressures on the county’s adult social care services.

However, it is estimated that there will be a shortfall of more than £30 million in the new council’s budget for the next financial year, the majority of which will have to be covered by the one-off use of reserves as well as some savings.

In the longer term, the financial gap is expected to widen and will need to be met by additional savings.

The new council will be working on a detailed plan for a major strategy to balance the authority’s books.

Cllr Les welcomed the largest increase in funding from the Government in a decade, but stressed that the additional money would not be enough to counter the soaring rate of inflation which has had a dramatic impact on the authority’s finances.

Alongside the highest rate of inflation for 40 years, the intense pressures on the country’s finances have been compounded by the aftershock of the Covid-19 pandemic as well as the ongoing effects of Britain’s exit from the European Union.

Cllr Les said that he was acutely aware of the financial pressures that households in North Yorkshire are facing, and every effort would be made to ensure that they are given the support they need.

For instance, a streamlined approach to providing financial support running into millions of pounds to households in the greatest need has already been approved to help to tackle the cost of living crisis.