East Riding Council is set to overspend by nearly £13m this year with a £9.2m overspend in it's School's budget.
It comes despite a five and a half million pound improvement in it's budget position over the last three months.
Finance Director - Julian Neilson - says there are a number of areas of the council's operations which are facing financial challenges.
A report presented to the council's cabinet said:
"The Council's General Fund budget is projected to outturn with a balanced budget, however, this position has been achieved through use of one-off funds to meet recurrent costs. General Fund services are projected to overspend by £12.7m and this can be balanced by underspends on centrally managed budgets and through use of reserves. The overspend is largely focussed within adult’s and children’s social care and relates to a significant demand for services at levels higher than budgeted for, combined with the impact on costs of inflation remaining higher for longer than forecast and a significant underachievement of savings. "
Underspends on centrally managed budgets, most significantly from the delayed implementation of Total Pay and Reward, combined with £3.9m of one-off support from reserves, bring the overall forecast overspend down to a balanced budget position. This highlights significant budget risk for future years as growth in recurrent annual costs are being met from one-off funds
Funding for Schools in the East Riding remains under pressure with the Schools budget expected to end the financial year with a £9.2m overspend.
Finance Director, Julian Neilson, says the education budgets are particularly difficult.
In his update to the cabinet Mr Neilson said:
"The forecast overspend of £4.7m on the General Fund budget, after £4.7m of support from reserves, in the previous budget monitoring report has improved to a forecast balanced budget position after £3.9m of support from reserves.
This is a welcome and significant improvement in a short space of time and reflects the initial impact of measures put in place by management during September 2023 to address the forecast overspend. However, it must be stressed that there remains a forecast overspend of £12.7m against service directorate budgets and the balanced budget forecast is achieved largely through one-off measures.
This highlights significant budget risk for future years as growth in recurrent annual costs are being met from one-off funds."
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