'Bankrupt' Nottingham City Council outlines major cost-cutting plans

More than 500 jobs could be cut at Nottingham City Council as it battles a major financial crisis.

A report published on Monday has revealed a £50m gap in the local authority's budget for 2024-25.

As well as service cuts, the loss of about 550 full-time equivalent posts is being considered in an effort to balance its books.

It comes as the council issued a section 114 notice on 29 November temporarily halting most new spending.

The measure was taken as the local authority was facing a £23m overspend for 2023-24, which in the council's view had mostly been caused by the increasing costs of social care, as well as looking after more homeless people, along with cuts in central government funding.

But the authority has also admitted past financial failures, including the failed Robin Hood Energy scheme, left it less able to cope with current pressures.

A section 114 notice means the council has ceased all new spending on services that it is not obliged by law to provide, or that it has already committed to.

But in a new report to the council's executive board, a set of initial proposals has been put forward aiming to reduce spending in 2024-25 as the local authority is battling a £53.7m deficit prospect.

These include:

The council has also said it is looking at cutting about 500 posts, from a staff of about 6,500.

It said every effort would be made to limit compulsory redundancies through targeted voluntary redundancy and support would be provided for those affected.

But the report confirms the proposed savings announced are only expected to reduce the deficit to about £33.2m.

Commenting on the initial proposals, leader of the city council David Mellen said: "As things stand, unfortunately the budget pressures we are seeing are unlikely to reduce next year and like many councils, we are facing a serious gap in our budget for 2024-25.

"This means officers have had to put forward proposals for significant savings and service reductions which no-one would want to make but have to be considered by councillors if the council is to meet its legal requirement to set a balanced budget.

"The proposals include some valued services and funding that we have been able to continue to provide in Nottingham but have already been stopped by many other councils."

The deficit comes despite a proposed council tax increase of a maximum of 4.99%, which includes the 2% adult social care precept.

But the council pointed out services for adults, children and housing and homelessness accounted for 62.5% of its budget and it had a lower than average council tax income due to the number of A and B band properties in the city boundaries.

It also said since 2013-14, the council's Revenue Support Grant (RSG) from the government had reduced by £97m every year.

Mr Mellen told BBC Radio Nottingham: "This is the most difficult time that I have ever experienced.

"Councils across the country are not receiving the money they need to have to run the services that government expect us to run.

"This is not what I came into politics for.

"We have agonised for the last three months as councillors, looking at these proposals and saying 'can we give support to these areas?'

"In many cases, we haven't been able to."

In a statement, the Nottinghamshire Trade Unions Council (TUC) said: "The main cause of the council's crisis is massive central government underfunding since 2010, amounting to £100m every year since 2013.

"Rather than fight the government for more money, the council attempted to cover the shortfalls by a failed commercialisation strategy that cost millions.

"We believe the best way to work together as one city is to unite in a campaign to fight, not implement, the cuts."

Some proposed cuts will have to go through a period of public consultation, while others will not.

The consultation will begin after the executive board meeting on 19 December, before final decisions at a budget meeting in February.

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