Blackburn with Darwen Council is to spend £350,000 on employing consultants to find savings as it battles to close a potential cash black hole of £9.9 million in 2025/26.
The proposal is included in an assessment of the authority's Medium Term Financial Strategy (MTFS) submitted to its executive board meeting on Thursday.
A report by resources boss Cllr Vicky McGurk says the budget for the current year 2024/25 is currently on track to stay in balance.
But it predicts that without extra government grant, other income savings or the use of reserves there will be an in year funding gap in 2025/26 of £9.9m.
This falls to £4.4m in 2026/27 and £4.6m in 2027/28.
The report asks the meeting as 'as part of a process of identifying savings options over the medium term to agree to commission external advisors to support the development of strategic business cases and that a budget of £350,000 funded from the Invest to Save Reserve be agreed for this'.
It also asked for the board to 'agree that some form of public and business-based consultation on the budget savings proposals should take place over Autumn 2024 with a view to informing decisions on the council’s budget for 2025/26.
Cllr McGurk's report says: "There is still more work to do before the Council can be considered financially sustainable.
"As the MTFS will expire at the end of the current financial year, work was planned to refresh the strategy.
"However, with the General Election due to take place in July 2024, the probability of a new government being formed and the likelihood of a comprehensive review of government spending plans, the update of the strategy will be deferred until 2025/26.
"The latest assessment of the council’s 'Value for Money' arrangements identified no significant weaknesses under the criteria for financial sustainability but one
improvement recommendation was made: ‘Going forward, the council should ensure that the budget efficiencies set are realistic and achievable’.
"This recommendation reflected some under-delivery of savings in both 2022/23 and 2023/24.
"It is a reminder that the council is expected to have in place a plan to deliver a balanced budget including savings proposals that are robust and deliverable.
"The council agreed savings totalling £4.140m to balance the budget for the year 2024/25.
"All these savings were permanent reductions and to the extent they are not delivered in full or at all, there will be an additional budget pressure for 2025/26 onwards.
"Demand for adult and children’s social care remains an ever-present risk for the council.
"The council should seek to reduce the reliance placed on reserves which are a finite source of funding."
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