Council bosses discuss financial woe at last meeting of 2023

Last week, Bradford Council announced it was in discussions with Government for “exceptional financial support” to try and balance a £73 million black hole in its current budget.

If this support was not forthcoming, the Council would not be able to balance its budget, and have to effectively declare itself bankrupt.

The issue was discussed by the Council’s Executive this morning, when the Leader said the situation was down to 13 years of Government cuts and rising costs of social care.

But the district’s Conservative leader claimed Council bosses were blaming everyone but themselves, arguing that other Councils have “rolled up their sleeves and got on” with Government cuts.

At the meeting, Council Leader Susan Hinchcliffe said: “We have got to the point, after 13 years of Tory austerity, that 87 per cent of the Council’s spend is on adult and children’s social care.

“That leaves just 13 per cent for everything else.

“We’ve had a 60 per cent cut in spending in real terms in Bradford over the last 13 years – £350m a year.

“The rising cost of living having a hugely damaging impact on Bradford. The Council is the safety net for the most vulnerable people, it helps pick them up and get them back on their feet.

“Sadly the way the economy has been mismanaged it has left us with lots of people in Bradford in poverty.”

Chris Kinsella, finance director, said the gap in the current year’s budget was now £73m. The gap in next year’s budget was likely to rise to £103m.

The Children’s Trust was responsible for the bulk of this overspend, but Mr Kinsella said adult social care was also a growing cost.

Members were told that work was underway to reduce Council costs, and detail would be revealed in January.

He elaborated on the “exceptional financial support” the Council was seeking from Government.

Currently any money the Council makes through the sale of assets cannot be spent on services – such as social care.

If the Government grants the Council the support it needs, it will be able to use income from property sales to boost the budget of other Council departments.

It would also allow the Council to borrow money to balance its budget.

He said discussions with Government over this plan were in their “very early stages.”

Cllr Hinchliffe added: “In 2010 62 per cent of our funding came from Government – now its just nine per cent.

“Agency costs are so high – the Government could cap these costs, or give us more money to help pay for them. But they don’t seem to want to do either.”

Councillor Sue Duffy, Executive for Children and Families, said: “We can’t get away from the fact that the Government has introduced a number of policies that directly impact families – things like cuts to benefits have exacerbated the issues faced by our poorest families.

“The Government approach to finance has been diabolical. What we have coming in the future is frightening.

“The issue of the high cost of children’s placements is absolutely appalling. Private companies that provide places have made £300m profit this year.”

Councillor Alex Ross Shaw, Executive for Regeneration, Planning and Transport, explained why the public were seeing large developments, such as One City Park and Darley Street Market in Bradford, and several Towns Fund schemes in Keighley and Shipley, when the Council was short on cash.

He said money for such capital projects cannot legally be spent on services. Many, such as the Transforming Cities Fund schemes underway in Bradford city centre, were funded with ring fenced cash from Government. He added: “But the income these regeneration schemes bring in through business rates help create a more sustainable budget in the future.”

Cllr Hinchcliffe added: “We can’t spend money for buildings on people. They are two separate pots of money that can’t be mixed without permission from Government.”

Councillor Sarah Ferriby, Executive for Healthy People and Places, said pleas from Council to Government for better funding for social care had fallen on “deaf ears.”

Councillor Rebecca Poulsen – leader of the Conservatives in Bradford, pointed out that her party’s finance expert Councillor Mike Pollard (Baildon) had been predicting the Council’s potential bankruptcy for much of the past year. She said: “It gives us no pleasure to saw we saw this coming.

Councillor Rebecca Poulsen (Image: Newsquest)

“There is not much of a plan in this report. There should have been a plan in place for this many months ago.

“Waiting for details on the planned budget in the New Year leaves Council staff, residents and Councillors in a dreadful situation – not knowing the fate of the Council.

“The Council’s leadership blames everyone else for the current financial situation, but takes no responsibility for their own failings.

“We don’t dispute there have been reductions in funding, but the majority of Councils have rolled up their sleeves and got on with it.”

Referring to the claims that the Conservative opposition could see the Council’s financial crisis coming, Deputy Leader Imran Khan said: “It didn’t take a genius to see where we were heading. It has been heading this way since 2010.

“Every time Councillor Pollard has said we are running out of money we’ve said we agree. It is easy to play politics, but we need solutions.”

Cllr Pollard said during this year’s local elections he said Bradford Council would be “bankrupt by the end of the year.”

At the Executive meeting he said: “Some people thought I was being a bit over the top.”

He said he had independently struggled to produce a balanced Council budget for the coming years, and had regularly questioned how the Council would do so.

He added: “By the Council refusing to fly the white flag until so late in the day is almost reckless.”

He said even if Government “waved a magic wand” and massively boosted funding for Children’s social care, the Council was still unlikely to balance its coming budgets.