Lincolnshire County Council says it cannot balance its budget without raiding reserves

Lincolnshire County Council will not be able to balance its finances without dipping into reserves next year “no matter what the Government gives us” - members have been warned.

Andrew Crookham, the authority’s executive director for resources, told a scrutiny meeting on Thursday that the council was looking at “somewhere upwards of about £60 million of cost pressures next year”.

“Energy cost prices are a significant part of that, as are inflationary pressures that have come up in other sections,” he said.

“No matter what we do, no matter what the Government gives us in terms of a grant we will not have a balanced position at this stage without having to potentially dip into reserves next week.

“Any way of saving money from a purely financial perspective has to be looked at and that’s simple economics for me.”

The Overview and Scrutiny Management Board on Thursday was asked to renew its contract with the ESPO Electricity framework from 2024 onwards.

As part of the report, the authority revealed it would use almost 14% less electricity this year, but will still be charged more than 83% extra.

The report said the council’s energy suppliers Total Gas and Power already produce approximately 50% of electricity through sustainable sources, but that for the council to go 100% green, electricity would cost an additional £231,450 a year.

Officers also estimated a further £100,000 could be added to the tag.

Scrutiny members asked why the council was not funding the extra cash to be completely green.

Council leader Martin Hill said: “We’re currently projecting a budget deficit for the next budget year. So I think that is why the recommendation is that we stick to the current policy, but there are within that quite substantial measures where we are mitigating that.

“A quarter million pounds for not guaranteeing 100% renewable green electricity I think that’s too high a price to pay.”

Highways bosses recently revealed they were facing nearly £20million of inflationary cost pressures in the future and would have to make tough choices over what projects to fund.

Coun Richard Davies expressed frustration and disappointment that the national government had not stepped in already to help fill the council’s funding holes, leaving the authority to do itself by raising revenue and manouvering its own budget.

Council’s have not yet been told what the government will be giving them next year.

In November, data collected by union UNISON suggested Lincolnshire district and county councils face budget gaps of more than £16 million for 23/24 and over £28 million by 24/25.

Lincolnshire County Council figures showed that the authority expected to use £9 million of reserves in 23/24 and £16 million in 24/25. A number of councils were hopeful at the time that the financial situation had changed and they would be able to address funding gaps.