Oxfordshire County Council faces £5.4m funding gap for next year's budget
The council says Government changes to funding formulas are impacting Oxfordshire.
Oxfordshire County Council has warned of a £5.4 million funding gap in its budget for the next financial year following changes to the funding formula made by the Government.
Money from central Government is now being directed towards areas with higher deprivation levels, which has sparked concerns from Oxfordshire’s cabinet member for finance, Councillor Dan Levy, who says this redistribution is negatively impacting local services.
Councillors will meet to agree on the budget at the full council meeting on 10th February. Ahead of that decision, the council’s scrutiny committee and cabinet will review proposals and options to bridge the funding gap. These include using reserves, setting aside less money for pay inflation forecasts, and reducing the allocation for the High Needs dedicated schools grant deficit, which supports education services for children with SEND.
Another option discussed was seeking an additional £1.5 million from council services in 2026/27 to address financial pressures.
Levy raised “stark” concerns about the long-term impacts of reduced funding from the Government. He said the funding cuts will have very real effects, even as the council plans a number of new investments.
“Money is being redistributed away from Oxfordshire and other areas on a large scale by the government,” Levy said. “While we respect the government’s desire to put extra money into areas of the country that have higher levels of deprivation, we do not think this should be at the expense of Oxfordshire and its residents.”
The proposed budget includes an increase of 4.99 per cent in council tax, the highest amount allowed without triggering a referendum.
Investments outlined in the budget include £19 million for children’s services, £14 million for adult social care, and £320,000 to maintain real-time passenger information digital display boards at bus stops. Funding will also go towards areas like drainage infrastructure with £4 million allocated to gully clearance and flood protection.
However, further significant financial gaps are projected, with a £14 million shortfall expected in 2027/28 and a net reduction of £24.1 million in 2028/29. Planning work throughout next year will be necessary to meet these challenges.
The council typically holds a public consultation on its budget proposals, but confirmed in November it would not proceed with this due to delays in confirmation of Government funding allocations.