Cash-strapped council to reduce its workforce

Leeds City Council faces a budget shortfall of more than £273m over five years

Job losses will happen at a cash-strapped council as it draws up new plans to tackle an ongoing budget crisis, it has said.

The equivalent of 260 full-time roles could go over three years as Leeds City Council faces an “unprecedented” financial shortfall.

It will be the latest round of cuts after measures including building closures and parking charges were introduced to save cash this year.

Last month, it emerged Leeds City Council faces a budget shortfall of more than £273m over five years.

The council’s latest financial report puts the gap for next year alone at more than £100m, equivalent to 16.7% of the overall revenue budget.

It said: “With the biggest area of spend within the council’s budget being the wage bill, staffing reductions will be necessary.”

The 260 figure includes around 148 roles to go in the next financial year, according to the Local Democracy Reporting Service.

The report said some vacant posts would remain unfilled and unions would be consulted to help avoid compulsory job losses.

Overspends at the council include meeting the rising demand of placing vulnerable children in care.

The report said: “The scale of the pressures on the council’s financial position this year, in particular in the demand-led areas of adults’ and children’s social care, combined with the gap over the next three years is unprecedented.”

Possible job losses and other savings will be discussed by the council’s executive board at a meeting next week.

The report said savings of £37.4m had been identified for 2025/26, meaning further cuts would be proposed later this year.

Cash reserves used

Failure to balance the budget would see the council required to issue a Section 114 notice, effectively declaring itself bankrupt.

At the end of 2023/24, the council managed to balance its budget after digging into cash reserves and receiving a refund on transport spending from the West Yorkshire Combined Authority.

The council previously warned the ongoing use of one-off funding sources would not be sustainable.

The report to Wednesday’s meeting said: “The 2025/26 savings proposals presented today total £37.4m, leaving a projected gap in the next financial year of £66.6m.”

The report said the council would monitor government financial announcements, including the chancellor’s autumn budget statement on October 30.

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