READING Borough Council has said that rising demand for council services is continuing to place “significant budget pressures” on the local authority.
Continued increases in demand on services and the costs of providing those services has posed financial challenges to councillors.
The council is also still yet to hear how much money it is set to receive in the upcoming Local Government Finance Settlement, as well as the results of the Government’s Fairer Funding Review.
Later today (Wednesday, December 17), the Policy Committee is set to update its medium-term financial strategy, which will outline how the financial challenges are set to be mitigated.
This includes how additional funding will be allocated to children’s services, with a focus on finding placements for looked-after children.
Then a public consultation is set to begin on Thursday, December 18, and will run until January 17 next year.
Adult and Children’s Services already account for around 70% of Reading Council’s overall budget.
The council says that percentage will rise again in the next financial year as it directs more of its funding into these statutory services.
The council says financial challenges in Reading mirror those being faced by other councils nationwide, with more vulnerable residents turning to their local council for support and the costs of operating services continuing to rise.
Despite those pressures, the council has worked to to make financial efficiencies of around £17 million to absorb additional costs.
A further £7.6 million is on track to be delivered by the end of the financial year, with a gap of around £4 million still to be found to balance the books by February.
After the conclusion of the public consultation and the announcement of the Provisional Local Government Finance Settlement, a further report will be brought to Policy Committee on in February.
The report is likely to recommend approval of a balanced budget to council in order that it can approve its budget and associated Council Tax level for 2026/27 at a meeting set for February 24.
Alongside consideration of the council’s revenue budget, the MTFS Update report to the policy committee will also consider the Council’s provisional Capital Programme of investment for future years.
This is different from the money the council uses to run services and cannot be used to balance its revenue budget.
On-going budget pressures mean that at this stage only a small number of priority schemes funded by borrowing, developer contributions or capital receipts have been added, other than fully grant funded and rolling programme schemes such as the construction of the Hexagon’s new Studio Theatre.
They include significant investment in bridges, streetlighting and traffic management measures; the purchase of vehicles to enable increased recycling; work to conserve and improve the Town Hall roof; works to increase the number of SEND school places in Reading; and structural conservation works at Cemetery Arch.
Councillor Liz Terry, Reading Borough Council Leader, said: “Cost and demand pressures continue for local councils, particularly in essential areas like caring for vulnerable children and adults or providing temporary accommodation for local people who cannot afford high local rental costs.
“Helping the more vulnerable members of our society are the fundamentals of what local councils do, and we would never shy away from that.
“In practical terms however, the more money the Council has to direct into these statutory services, the less money is available for other universal services most of us expect.
She explained: “Many councils have yet to recover from the deep and shortsighted cuts to local government finances made under previous Governments and, combined with several years of absorbing increased demands for high- cost services, it is easy to see why there are now 29 councils receiving Exceptional Financial Support (EFS) from Government, which is up from 18 the previous year.
“It means one in six councils with social care responsibilities are now dependent on this additional support.
“The council’s hard work to stabilise its finances means Reading is not in that position, but our demands mirror those seen at most other councils, with residential placements for children regularly costing £10,000 a week. It underlines the enormous challenges councils face in securing appropriate, cost-effective placements for children and young people with complex needs.”
She concluded: “While councils have been balancing their books through measures such as savings in discretionary service areas and drawing on their diminishing reserves, this is not financially sustainable in the long-term.
“This year the Government is providing local authorities with a multi-year settlement, which enables the Council to better plan for the next three years, rather than year-to-year as was previously the case.
“The Government is also in the process of simplifying more than thirty different funding streams as part of its Fairer Funding Review.
“Along with other councils, we will wait and see what that means for Reading before finalising our budget for the year ahead, and up to 2029.”
