Barnet Council’s £20million overspend on this year’s budget has grown to £25million despite attempts to cut costs reports David Floyd

The Labour leader of Barnet Council has warned that his administration is facing a “perfect storm” of rising costs and increased demand ahead of a crunch cabinet meeting next week. 

Barry Rawlings says that a growing need for adult social care and temporary accommodation for homeless people, which the council has a legal duty to provide, is the main cause of the £25million gap in the council’s budget for the current 2024-25 financial year. 

But Conservative group leader Peter Zinkin slammed the council’s Labour leadership, accusing it of “breathtaking financial mismanagement” since coming to power in 2022. 

Massive drop in reserves

The council’s estimated funding gap has risen from £20million in the previous quarterly figures despite the administration’s attempts to cut costs. 

This is primarily down to a £1.7million increase in the overspend on temporary accommodation and a £3.7million increase in the overspend on adult social care, outlined in the ‘2024/25 Quarter 2 Financial Forecast and 2024/25 Budget Management report’, which is one of the papers to be discussed at the meeting on Monday 18th November.

The report explains that: “If the forecast overspend crystallises, and none of the risks materialised, Barnet’s un-ringfenced reserves at the end of 2024/25 would stand at c£1m.” 

It adds that: “This is clearly an unsustainable position” before outlining the council’s “action plan” to tackle the issue. 

Given the council’s financial position has become £5million worse during a three-month period when it was already seeking to save money, the situation looks increasingly precarious. 

“Difficult decisions” – Barry Rawlings

In a statement issued today, Cllr Rawlings said: “We are in a perfect storm of more people needing adult social care or being placed into temporary accommodation, while at the same time the costs of these services just continue to increase.

“The council’s budget has halved since 2010 with 14 years of austerity-driven cuts to local government funding. While the Chancellor’s Autumn Budget gave us some positive news, right now it’s not enough to close the budget gap we face.

“By law we must set a balanced budget, which is to say we can’t spend beyond our means. We have curtailed our spend but the fact is we still have more difficult decisions to make.”

“Unforgivable recklessness” – Peter Zinkin

However opposition Conservative group leader Peter Zinkin blamed Labour for the council’s woes. Cllr Zinkin told Barnet Post: “Barnet Council is reeling as it faces an unprecedented financial crisis, launching a consultation on slashing its own workforce simply to meet its legal requirements for a balanced budget.

“To put it plainly, we’re talking about a potential ‘decimation’ of staff – cutting one in every ten employees. This isn’t an isolated issue. It’s the culmination of Labour’s breathtaking financial mismanagement since coming into power.” 

He added: “This level of recklessness is unforgivable. Labour’s disregard for basic financial management has brought Barnet to the edge of financial collapse, and now it’s residents’, essential services and hardworking council staff who will pay the price.”

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