Finance report forecasts major gap in 2026-27 budget due to increasing numbers of children and adult needing support.
Reductions in central government funding are placing an increasingly serious strain on local authority finances, says once council. What’s more, this is happening just as demand is rising.
A quarterly finance report published by Bournemouth, Christchurch and Poole Council sets out a forecast deficit of £27m in its budget for 2026-27, which it largely puts down to an increased number of children and adults needing support.
In addition, BCP Council says it also faces significant additional pressure as a result of the dedicated schools grant high needs block, which includes an annual interest payment of some £10m.
The council says every effort is being made to reduce costs, work efficiently and manage demand. Spending controls are in place, recruitment is tightly managed and work through the council’s ‘continuous improvement and innovation programme’ has been prioritised in the hope of finding further savings. Short, medium and long-term opportunities for savings are all being identified and actioned.
Cllr Mike Cox CBE, Deputy Leader and Portfolio Holder for Finance at BCP Council, says: ‘We have warned government repeatedly that councils across the country are at the sharp end of a national funding crisis. Ultimately, funding for vital services such as adults and children’s care is not keeping up with need or rising costs of delivering that care. This is a gap that central government must address urgently because demand is rising, inflation is rising, and yet government funding for BCP Council will reduce by £15m in real terms by 2028-29. It’s easy to see that this is simply not sustainable.
‘We welcome the government’s recognition that reform in areas such as SEND and adult’s social care is needed, but councils cannot afford to wait for that change. Our residents and communities need action now before the services they want and need suffer. Locally we have done everything we can to manage the financial impact of this rising need for care responsibly. We are entering this period of unprecedented pressure from a far stronger position because of the careful financial management we have put in place in recent years. We’ve worked hard to control spending, bring in extra income, deliver planned savings, reduce costs of running services by being more efficient and freeze non-essential spending across the council – and we will continue to do so.
‘It is this strong financial discipline which has enabled us to build reserves, helping us respond to this growing need. But using reserves is a last resort and cannot continue indefinitely. This is not a local issue. It is a growing national crisis. Without action, councils across the country will struggle to protect and support those who need it most. We’ve already reduced spending in areas of the council, including £14m planned savings and efficiencies in 2026/27. But efficiencies alone cannot keep pace with rising demand. We need government to act now and will continue to lobby for that change to happen.’
Photo: William Warby / Unsplash
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