East Ayrshire Council has set out a plan which it hopes can deal with financial issues, including a £6million overspend.
A range of challenges and ongoing pressures were set out at the council’s quarterly performance report ‘East Ayrshire Performs’ at cabinet earlier this week.
During the first quarter of this financial year (April to July), the council has incurred a £6m overspend.
Part of the council's plan to deal with this issue it to halt any non-essential vacancies being filled until further notice.
Joe McLachlan, Chief Financial Officer and Head of Finance and ICT, stated there was potential for this to rise to as much as £20m by March 2025.
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This would depend on things such as demand, cost pressures and spending plans remaining the same way.
Almost £10m of that projected overspend would relate to services provided by the Health and Social Care Partnership, with the other almost-£10m relating to services directly governed by the council, primarily education.
East Ayrshire Council says that financial recovery plans are currently being prepared for services across the authority.
Mr McLachlan explained: “These precautionary measures will be challenging for services, and they will require an increased level of financial control and monitoring to ensure that their implementation has the desired impact - which is to prevent the potential financial projection being realised.
“The council’s Management Team fully supports these interventions which will ensure that recovery action can begin immediately, with other service-based recovery options implemented at pace.
"Additional technical and professional supports have also been provided to assist Heads of Service complete and monitor their recovery plans."
The council says that Health and Social Care services continue to experience legacy issues from the pandemic as well as the long-term pressure from an ageing population with increased numbers of people living with multiple and complex conditions.
Councillor Douglas Reid, Leader of the Council, welcomed the new cost-cutting approach.
He said: “East Ayrshire Council has always prided itself in having sound and rigorous financial management arrangements in place.
"This has enabled our Finance Team to identify potential risks at an early stage in the fiscal year and to respond quickly with an alternative course of action.
"We’ve known for some time that there would be some significant financial challenges ahead for us, but we have previously taken steps to prepare for this and having a whole Council approach to financial recovery is the way forward.
“Innovation and new models of services will be the key to success and the creation of the £40m ten-year fund to tackle child poverty and support early intervention and prevention initiatives aimed at reducing demand on Council services, reducing costs, and increasing collaborative working with partners will support the Council - and our communities - into the future.”
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