Cash-strapped Cheshire East Council is forecasting a £3.1 million overspend this year – in addition to the planned use of £25.3 million exceptional financial support, writes Belinda Ryan.
The figures are revealed in the first financial review of 2025/26 (FR1) and are based on the council’s income, expenditure and known commitments as at the end of June 2025.
And a report to next week’s meeting of the finance sub-committee says, while the situation could improve, it could get substantially worse.
“The value of additional mitigation plans not yet reflected as delivered at FR1 are estimated at £2.8 million, giving a potential improved overall forecast of £0.3 million overspend,” it says.
“However, should the current mitigations included in the FR1 forecast not materialise, alongside further risks identified, then the forecast overspend position could increase to £18.7 million adverse.”
It continues: “The forecast overspend of £3.1 million remains a significant financial challenge for the council when considered in addition to the planned use of EFS of £25.3 million.
“Reserves levels are insufficient to cover this level of overspending.”
Councillors will be told the key areas causing these financial pressures include a projected overspend of £9 million within children and families, which is largely due to increased costs of placements and staffing.
The report says a shortfall of £9.7 million is forecast against in-year cross-directorate transformation savings.
But it says some of these pressures have been offset by savings of £4.7 million within the place directorate due to vacancy management and various one-off income items expected in-year.
It adds: “The contingency budget is contributing a further £7.2 million to the overspend position – including the use of £1.6 million to cover the pay inflation pressure – whilst interest and minimum revenue provision (MRP) are forecast to be £3.3 million under budget due to lower than expected borrowing, increased levels of investment and slippage in the capital programme.”
The report says mitigations are planned to manage pressures.
These include:
– line-by-line reviews of all budgets to further identify immediately any underspends and/or additional funding
– actively managing vacancies, particularly agency usage and reduce any overspends on staffing as soon as possible
– review the borrowing elements of the capital programme to minimise the minimum revenue provision and interest payable
– review of capital receipts available and potential surplus assets that can be sold
– for children and families – reviewing costs of placements, establishment reviews, reunification of children
The council finance sub-committee meeting takes place at Macclesfield Town Hall at 10.30am on Wednesday, September 10.
Here we go again – shortfalls – guess ratepayers, who don’t receive a penny in financial assistance, are going to be hammered with huge increases on council tax and green bin collection increase – YET, you cannot claim compensation from CEC when bins are NOT collected, road gullies/storm drains are NOT cleared, traffic problems ignored, no police presence – the list goes on.
Sadly Cheshire East Council can not effectively manage its operations and operate within budget. Despite increased revenues from increases in Council Tax over many years, often with above inflation increases. Add in the increased revenues from the explosion in new housing. They forget the Citizens have paid the national insurance and income tax on income before paying this tax. A 5% increase is actually 6% when you add in the income tax at basic rate, the effects of National Insurance is more difficult to determine.
What actions are they taking to recover the 20 million pounds of underpaid council tax. Where are the details of the 91million Pound cost cutting programme and plan which has not been made available to Councillors.
What Planned Management restructure has been implemented to reduce costs and enhance effectiveness. Have they reduced their income cost ratio a key management indicator that prevails in the private sector.
There is a distinct lack of communication between Cheshire East and Its residents.
Relevant information appears to be withheld.
Why are Directors, Executives and Senior Managers not held both responsible and accountable.
It is joke when the Councillors duly elected by the citizens fail to hold the executive to account.
Where has democracy gone?