Action is pledged on Shropshire Council's £5m overspend

The predicted overspend has been labelled “a catastrophe” by a councillor.

The authority’s cabinet members voted to approve recommendations made in the Financial Monitoring Report yesterday, which include a spending freeze.

The overspend forecast in children’s services alone is predicted to be £3.9 million, unless changes are made. The report also revealed a new ongoing budget pressure relating to unaccompanied asylum seeking children of more than £500,000.

Central Government funds a proportion of the costs of caring for the children through a weekly value based on each child’s age.

Previously the council has managed to fund these costs within the grant funding available but due to what it says are “complex safeguarding needs” and “high flight risks” there has been a need to place some children in high cost placements that are not fully funded, placing a pressure on the service.

The news comes as it was revealed 10 Vietnamese children are being looked after by the council after being abandoned in the Battlefield area of Shrewsbury in May.

Lib Dem leader Roger Evans spoke at the cabinet meeting held at Shirehall. He said: “£5 million coming out of reserves is catastrophic.

“I understand that extra costs have been incurred by safeguarding of children.

“I’m having complaints from residents that there’s a request for a bin at the side of the road so that the road can be cleared of litter and dog mess but that it’s been refused.

“Another request for a mirror on a bad road bend has been refused due to a spending freeze.

“The freeze would only make the problems worse next year. The expenditure next year will be even greater than is at first estimated. We are facing a catastrophe. There needs to be policies put in place, not living day to day with one-off grants.”

If the changes are made, it is predicted that the overspend would be reduced to about £400,000.

But council leader Peter Nutting said he hopes to balance the budget by the end of March. He said: “This is a slightly worse picture than we were expecting. Whilst the report is suggesting we can end up with a £400,000 overspend, it’s my intention that we end up with a balanced budget.

“We are taking the necessary action to ensure that happens.”

“We’re having discussions and we will be doing everything to get back to where we should be with the budget.”

Councillor David Minnery added that the predicted £5 million overspend is “clearly unacceptable”.

He said: “This is reporting what’s happened over the first part of the financial year.

“There’s a predicted overspend of £5 million which is clearly unacceptable.

“There will be a spending freeze.”

Councillor Minnery added that part of the spending is due to looking after unaccompanied children.

He said: “These individuals are going through a catastrophic period.”