Where has it all gone wrong? We take a second look at Somerset Council's finances....
The latest set of published papers suggest a lack of pace has contributed to Somerset Council's problems.
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Where has it all gone wrong? We take a second look at Somerset Council's finances....
A couple of weeks ago we took a look at the finances of Somerset Council. This was against the background of the council declaring a financial emergency. Oh yes, and an outbreak of finger pointing and blame attribution among the various political parties at the council.
If you’d like to refresh your memory, then follow the link here to: Somerset Council battles with its finances
Before we go further looking at Somerset Council, it is worth reminding ourselves of how bad things are elsewhere. Last month Nottingham City Council announced they were filing a s114 notice (equivalent to bankruptcy). That was the ninth council to do so since 2018.
Last week Hampshire Council said they faced a £57m gap for 2025/26 and may have to consider a s114 notice in the future (albeit they appear to have more of a financial runway than Somerset).
And the icing on the cake was a local government finance policy statement following on from the Chancellor’s Autumn Statement. This suggested that local authorities should consider using reserves to maintain services over this and the next financial year. And there wouldn’t be extra money to help with the widening gap most councils face between expenditure and income.
That may be the backdrop but our concern is Somerset. The latest papers released by the council are our cue to swing into action and attempt an analysis of some of the issues that are starting to come out of the woodwork.
The newly published papers are to provide information to the last full council meeting of 2023 which will take place later this week on 20 December. Their publication has revealed more of the detail behind the financial crisis and give yet more pointers as to how we got here.
But first a reminder of something else. The financial position of Somerset Council is an estimate. A good one perhaps but still an estimate. The reason being that the accounts of the four districts and county that merged to form Somerset Council on the 1 April 2023 are still outstanding.
So no-one can be totally certain as to what the balances of the council were on its first day of business. This matters. As the council themselves point out: “A common feature of councils that have issued section 114 notices has been the number of prior year external audits that have not been completed with issues arising that were not known when setting budgets.”
Which is nothing to be complacent about as only one of the five councils has signed off accounts for 2022/23. And needless to say one council (can you guess which one boys and girls?) still has failed to get sign off on its 2021/22 accounts.
Yes it is our old friend South Somerset District Council. We were told the accounts were due to be signed off “shortly” back in October. The latest on this, as of 12 December is that they are now “approaching completion.” Let us guess. In a couple of months perhaps the accounts will be defined as: “shortly approaching completion.”