Haringey is taking action to address budget pressures brought about by the soaring demand for adult services and rising costs to ensure residents can still receive the best possible care.
An additional £17.3m was invested into the social care budget this year as the council were forced to deal with the growing complexity of cases since Covid-19 at the same time as inflationary and interest rate pressures.
However, a Cabinet report published this week predicts an adult services deficit of £18.5m caused mostly by an even greater demand for high-cost and lengthy care packages.
This figure represents 91% of the total £20.5m overall provisional shortfall, made up of £17.5m for adult social care and a £1m pressure on the housing demand budget brought about by high costs and a chronic shortage of temporary accommodation as private sector landlords leave the market.
Cllr Dana Carlin, Cabinet Member for Finance and Local Investment, said:
Despite several pressures beyond our control and the lack of adequate and sustained government funding, our sound financial management meant we were able to publish a balanced budget in February as well as invest heavily in vital services.
However, continued high demand for adult care services, increased costs, excessive inflation and continually rising interest rates mean that like many councils up and down the country, we are once again facing severe budget pressures.
Adult social care took up 44% of our budget in the last financial year and it is simply unacceptable that this government has not been able to get a grip on funding this vital frontline service and is leaving it to hard-pressed councils to pick up the bill.
It is clear this year and beyond will be challenging but we will continue to show leadership and work closely with officers to mitigate the budget pressures as far as possible.
Inflation remaining higher than expected and interest rates rising to levels not predicted by the financial markets are increasing pressure across the whole of the council’s revenue and capital budgets.
Debt arrears are growing because of the cost-of-living crisis and costs are increasing for Children with Special Educational Needs and Disabilities (SEND) services.
This is a similar story for many councils across the country. It is thought UK local authorities are expected to be £5.2bn short of balancing their budgets by April 2026, with the average council facing a predicted deficit of £33m.
Despite these challenges, council departments continue to make savings and are already on track to deliver almost 80% of these, a higher proportion than in previous years.
Led by directors, a comprehensive plan to reduce the budget shortfall is underway including ensuring the council gets the very best value out of every pound it spends.
The 2023/24 Finance Update Quarter 1 (Period 3) report will be considered by Cabinet at its meeting on Tuesday, 19 September.
