Savings might be used to help dig the Isle of Wight council out of a £10m overspend this financial year, its finance director has revealed.
However, Chris Ward has also warned dipping into the local authority’s savings could leave it short next year and he says the cash would need to be replaced.
Adult social care services, home-to-school transport, growing numbers of children in care and the Medina and The Heights leisure centres are areas that have required more money than was originally budgeted for.
£3.2m overspend
On Tuesday night, head of finance, Chris Ward, revealed the budget is predicted to be over £10 million short.
He said the gap could be covered by savings and the Covid-19 contingency fund, bringing the overspend down to £3.2 million.
Corporate contingency fund
Further cash could come from the corporate contingency fund, but it would mean any ‘risks’ later in the financial year would not be covered, Mr Ward said.
He said the council could use further reserves to balance the books at the end of the year, if required.
Impacting next year’s finances
Mr Ward warned an overspend was likely to impact next year’s finances as well and said it had not been accounted for in the Isle of Wight Council’s medium term financial plans.
Quirk: Fair funding review needed
Conservative councillor, Chris Quirk, said carrying an overspend was not sustainable and said a fair funding review was needed, to give the council more cash.
The long-awaited review will not happen in this parliamentary session, said Mr Ward, but he hoped the government’s autumn statement, the local government finance statement and adult social care funding would provide more council cash.
This article is from the BBC’s LDRS (Local Democracy Reporter Service) scheme, which News OnTheWight is taking part in. Some alterations and additions may have been made by OnTheWight. Ed
