Overspend shows slight reduction as year end nears

The latest financial information shows that Shropshire Council’s budget overspend has fallen slightly to £34m while it expects to make £47m of savings in the financial year that ended in March 2025. 

The council has published regular financial updates throughout the year to provide transparency around its financial challenges. 

The latest information is for the 11th month of the year and shows that the council expects to have sufficient reserves in its General Fund Balance to cover the forecast overspend; the fund will have almost £5m at the end of the year. 

A report shows that the council expects achieve 52% of the £90m savings target it began the financial year with and has plans in place for the £44m outstanding savings from this year and previous years which require new or different ways of working and time to implement. 

However, the report stresses that the Council’s financial position remains extremely challenging with continuing pressures across many areas from rising demand and growing costs for services, particularly in social care, which accounts for around £4 in every £5 in the council’s budget. 

The latest information shows that, like many councils nationwide, Shropshire is also seeing continuing pressures in many areas of social care such as external residential placements, fostering and growing numbers of children with special needs requiring home to school transport.  

The council has approved a further £18 million programme of savings for 2025/26, with £7.7m of these developed following public consultation. 

Key areas include a review of waste services and improving park and ride services in Shrewsbury to increase income, while further savings will come from service reviews across the council. 

James Walton, executive director for resources, said:

“The report shows our position has improved slightly and the expected overspend by the year-end is reduced by almost £0.9m and can be meet from our General Fund Balance reserves, meaning we remain in budget. 

“The £47m savings that Shropshire Council has achieved this year – equivalent to around 18% of our day-to-day budget – is one of the highest figures proportionately of any council in the country. This comes after achieving £51m of savings in previous year. 

“We must be clear to the people of Shropshire – the outlook remains extremely challenging, particularly as demand for social care continues to rise. More difficult decisions lie ahead. In our medium term financial strategy, however, we have plans for further savings next year, as well as delivering on any outstanding savings that for a variety of reasons cannot be delivered quickly.” 

The final year end figure is expected to be published in May 2025.