A number of new savings proposals have been set out that, if agreed, would save us millions of pounds and help us to balance the books for 2025-2026.
We continue to face significant budget pressures due to a number of factors which are beyond our control. These include pay and price inflation and rising demand for services, particularly in adults and children’s social care.
As well as a current forecast overspend for 2024-2025 (the current financial year) of £28.1 million, we have a predicted shortfall in our budget for the year ahead (2025-2026) of £18.6 million which has resulted in the new savings proposals being put forward.
Today’s announcement is detailed in a report on the Cabinet agenda (item 14), which will be considered on Thursday 9 January 2025. It sets out how we intend to make the savings required, meet the funding shortfall and set and maintain a balanced budget for 2025-2026.
We are legally required to set a balanced budget in advance of the beginning of each financial year.
The new proposals announced today aim to deliver £18.6 million of savings in 2025-2026 to meet the predicted budget funding shortfall.
The new savings proposals follow a significant savings plan for 2024-2025 which is on track to achieve its target of £31.9 million by the end of this financial year (31 March 2025) and will continue to deliver a further £18.9 million of savings in 2025-2026.
Derbyshire County Council Leader Councillor Barry Lewis said:
“During the course of the year we have made no secret of the fact that the pressures on our budget continue to mount due to costs and demand which are beyond our control.
“However, we are in a better space now than we were this time last year and the solid savings plan we put in place at the beginning of 2024 is on track to achieve its target.
“We are continuing to build on this good work to ensure we set a balanced budget for the year ahead.
“While we have made a step change in the way we identify and deliver savings, the pressures keep increasing, so we are focussing on ways to reduce those pressures and also fundamentally changing our operating model, including automating and digitising support services where we can.
“The situation around adults and children’s social care is serious for all councils but we are taking action to challenge how we deliver it, and also working as One Council to bring functions together and challenge all day-to-day expenditure.”
Following the announcement earlier in December that our forecast overspend for the current financial year totalled £28.1 million (the quarter 2 report) a number of measures were immediately put in place to support bringing this under control which include:
- vacancy management including pausing recruitment where appropriate
- reviewing vacant posts and freezing or deleting them where appropriate
- reviewing the use of agency workers to reduce costs
- reducing expenditure on procurement to only spend money on essential areas
A cross-party Budget Commission has also been set up to review the causes of significant budget pressures.
A review of our whole operating model is also being commissioned to ensure we are working as effectively as we can and that we are considering all available opportunities to reduce costs through rationalisation and improvement.
Councillor Simon Spencer, Cabinet Member for Corporate Services and Budget, said:
“These are still incredibly challenging times not only for our council but authorities across the country and I want to reassure our residents that we are facing these challenges head-on and doing what we can to ensure we balance our books while coming up with new ways to ensure we are operating in the most efficient and effective way possible.
“Our robust financial planning goes alongside other measures we are taking to ensure a strong future for this council and the services it provides to those who need them most.”
A full list of new budget savings proposals put forward is included in the report. They include:
- the use of AI tools to streamline and automate parts of the care and support planning process for adult social care
- a review of current in-house and external extra care housing schemes
- ‘One Council’ integration through centralisation and redesign of council support services
- a review of transport provision for people using adult social care services, looking at eligibility and charging policies
- improving reablement to reduce hospital stays and maximise independence
- council property rationalisation, reducing our property portfolio to a more affordable, sustainable level
- implementation of reforms set out in the Environment Act around collection and packaging which relate to waste and recycling
- savings in senior management costs, relating to savings from the transfer of functions to the East Midlands Combined County Authority (EMCCA) and part of the ‘One Council’ programme
Following the Cabinet meeting on 9 January 2025, our Improvement and Scrutiny Committee – Resources, will meet on 13 January 2025 to consider the new budget saving proposals and provide feedback to Cabinet.
The budget-setting report will then be considered by Cabinet at its meeting on Thursday 30 January 2025 before going to Full Council when it meets on Wednesday 12 February 2025.
Many of the proposals, if it is agreed for them to go forward, will be subject to further Cabinet reports and then followed by appropriate public engagement or consultation before any final decisions are made.