Dorset Council is forecasting an overspend of £13.2 million by the end of this financial year, equivalent to 3.5% of the £376.7 million budget set in February 2024. This has increased from the £10.1 million that was forecast at the end of July.
Much of the overspend is due to increases in demands on services growing faster than expected, particularly in adult social care. The number of adults requiring support from the council is higher than those forecast when the budget was set. Dorset has the largest population of older people per capita of any other county in England and the council is now seeing an increase in demand to help for carers who can no longer support family members, meaning that the council is now providing the care that is needed.
The process to set the council’s budget for next financial year is well underway, and the current forecast budget gap is £35 million, around 9% of the budget. Increases to council tax and business rates are set by government, and the provisional detail of local government funding settlements for next year will not be announced until late December.
Cllr Simon Clifford, Dorset Council Cabinet Member for Finance and Capital Strategy said:
“We continue to work hard to reduce our overspend. We have acted quickly to make sure that resources are used efficiently to deliver the council’s services in a sustainable way.
“The promise made as part of the Autumn Statement of a 3.2% real terms funding increase does not go far enough to address the underfunding for Dorset Council. The increase to national living wage and national insurance will put significant pressure on many of the small and medium size businesses that provide much needed local employment. Many of these businesses also provide services for the council and may look to the council for help meeting this additional burden. Without fair funding, it’s not clear how this cost can be met. We now await the detail of what this means for us in Dorset, which we expect will come in late December.
“Like many councils across the country our financial position is extremely challenging, and it is more than likely we will need to make very difficult decisions to meet our legal responsibiltiy to set a balanced budget.”
