Fears over city council finances

There are fears Gloucester City Council could be in serious financial trouble after budget overspending has wiped out cash reserves.

Liberal Democrats councillors warning that any further financial shocks during 2023/24 would lead to services being cut to balance the books.

The council has around £1million stored in its general fund for emergencies but is forecast to overspend by £1.4 million, leaving the working balance £400,000 in the red.

The ruling cabinet’s monitoring report on first quarter’s financial outcomes, reveals:

– the planning and housing portfolio is forecast to be £1.1 million over budget

– the culture and leisure portfolio is forecast to be £382,000 over budget

– the corporate and funding portfolio is forecast to be £362,000 over budget

Key financial pressures on the city council include the rising cost of temporary accommodation for housing the homeless, and the operating costs of the GL1 leisure centre nearly doubling due to rising energy costs and the cost of living crisis and high inflation.

Councillor Jeremy Hilton, leader of the opposition, said: “A large proportion of the council’s cash put aside for a rainy day has been blown in the first quarter of this financial year.

“The Conservative financial management of the city council has been unbelievably poor and the financial situation could be even worse because the accounts have not been audited for the last two years.

“Without urgent action to balance the books the council is set to overspend by 3.7% on its gross expenditure.

“There could be other surprises the administration is sweeping under the carpet.

“We know the Conservatives sleepwalked into the closure of the GL1 leisure centre and the Oxstalls tennis centre and the taxpayers of Gloucester cannot afford another financial disaster.”

The council is considering purchasing property to increase the availability of temporary accommodation and reducing the reliance on expensive hotel rooms.

It has also applied to the Government for funding to meet the rising energy costs of heating the Barton and Twyver pools at GL1.

Councillor Declan Wilson, Liberal Democrat finance spokesman, added: “The Conservatives have blown our emergency reserves, which have taken years to build up, in just three months.

“There is now a debit balance of £400,000.

“It leaves the council vulnerable to just one more financial shock and then we start cutting services just to balance the books.

“We need an explanation from the Conservatives.”