Cheshire East Council forecasting £3.1m overspend this year

Cash-strapped Cheshire East is forecasting a £3.1 million overspend this year, in addition to the planned use of £25.3 million exceptional financial support.
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 at FR1 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 finance sub-committee meeting takes place at Macclesfield Town Hall at 10.30am on Wednesday 10 September.
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