Somerset Council 'could still go bust'

Somerset Council's top finance officer has warned the authority remains in a "critical" position despite a planned almost 7.5% increase in its share of council tax bills.

A report by Maria G Christofi, interim chief finance officer, said the budget for 2025/26 was "robust and constitutes a balanced and lawful budget".

But the expected budget gap for 2026/27 is £101m, rising to £190m by 2029/30.

She said without action "to develop and implement further transformation and savings plans at significant scale and pace", the council would run out of reserves in two years' time and go effectively bust.

For the second year in a row, Somerset Council has been given special permission from the government, called exceptional financial support, to spend millions of pounds of capital money, largely from selling off property, on day-to-day services.

The agreement also allowed the council to increase its share of council tax by 7.49% , above the usual 4.99% cap.

Ms Christofi said it was "highly likely" the council would need exceptional financial support again in 2026/27.

She also warned about the possibility of intervention by the government if the council was not able to show it was financially sustainable.

An intervention could mean the council being required to work with a government-appointed assurance board or the appointment of independent commissioners to oversee the running of the local authority through its financial recovery phase.

Commissioners would take over the decision-making of the council, Ms Christofi said.

Liberal Democrat council leader Bill Revans said: "This is very much a budget to avoid unelected commissioners coming in telling us what we should and shouldn't spend money on here in Somerset.

"We are desperately trying to keep and protect services."

Speaking to BBC Somerset, he said councils all over the country were in the same position.

But he blamed the Conservatives for failing to raise council tax for the past six years when they were in control of the council and for putting Somerset "closer to the edge".

He added a consultation of residents had found 52% were in favour of higher taxes to protect services.

Opposition Conservative group leader, Mandy Chilcott, said her party had always managed to "balance the budget with the money we had" without the need for tax increases.

Revans said the system for funding local authorities was "basically broken" and urged the government to take action on a national level.

The government announced the extra £700m for English council budgets in December, as a "first step" to rebuild their finances.

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