Council risks £3.9m overspend amid service demand

Stockton Council could overspend by £3.9m this financial year

A council has warned it is heading for a £3.9m budget overspend this year due to "growing demand" for services.

Stockton Council is facing "significant financial pressures" with bosses pointing to "volatile" costs for social care, according to the authority's latest financial report.

The council was already reviewing services in a transformation programme to make savings and tackle a budget gap of £1.9m reported earlier this year, which is expected to rise to £8.1m in 2026.

The report said: "Work is under way to look at ways to mitigate this projected overspend and the position will continue to be closely monitored and managed."

The update from Gary Cummings, deputy chief executive and director of finance, found one child in care alone was costing the council in excess of £1m while elderly and mental health places had exceeded their budgets, according to the Local Democracy Reporting Service.

Shortfalls of hundreds of thousands of pounds from empty town centre shop units and low income from car parks were also found.

'Financial pressures'

The report stated Stockton Council was "effectively on target to achieve the transformation savings but further pressures have created a further budget gap".

The council said it was focusing on children in care in its transformation programme but, according to the financial report, it was "difficult to predict financial savings".

It added: "These challenges are not unique to Stockton and the financial pressures experienced by many councils across the country are well documented."

Money which had been set aside for specific reasons could be used to fill the gaps for now.

But the report concluded: "The use of reserves to fund overspends is not sustainable and it is a key area that we must work to avoid as part of the transformation programme."

Middlesbrough Council is forecast to spend £3.7m more than its 2024-25 budget.