Worcestershire County Council to hold meeting over funding blackhole
A cabinet meeting will take place today (16 January) over the draft budget proposals for 2025/26 financial year
Worcestershire County Council are set to hold a cabinet meeting later today (16 January) to look at the draft report proposals for the upcoming 2025/26 budget and how it will aim to fill a £33.6m gap in it.
Papers published last week ahead of the council meeting revealed the council had submitted a "capitalisation direction" request to the Ministry of Health, Communities and Local Government for up to £33.6m for the 2025/26 budget, and up to £43.6m for 2026/27.
The request means the authority has asked the government if it can sell assets or borrow to fund day-to-day costs.
It said in the report that if MHCLG did not grant the dispensation request then the council would not be able to balance the 2025/26 budget.
The council say it would be forced to issue a section 114 notice, meaning they cannot carry out any new spending.
This would mean that although local authorities can't technically do so, it would be declaring itself bankrupt.
Ahead of the meeting, Worcestershire County Council leader Simon Geraghty told us they are working to address the financial gap.
"We have got a series of weeks now where we'll be developing further plans and to look at how we address that gap," he said.
"There's more people needing our services and the cost of those services are going up and our income is going up, but not as fast to keep pace with that demand, so we're facing relentless financial pressure.
"We're applying to government for exceptional financial support that will allow us to use capital resources on day-to-day revenue spend which we will have to pay back, but what it will allow us to do is give us time to actually develop the plans to reform the authority."
The final budget report is due to be presented to the cabinet in February.