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County forced to slash £45m to fix ‘extremely challenging’ finances

A major council in the north has this week announced that it is considering pushing for £45m worth of savings to keep its fragile financial position afloat in the future.

Lancashire County Council will hold a cabinet meeting next week to work out where the savings will come from through a “detailed review of service budgets”.

Leaders of the authority say that the savings will come from more than 40 council-run services, but that frontline service delivery would not be affected as the money will be taken from efficiency savings, recurrent underspends, income generation and “service changes”.

Lancashire also admitted that the council’s position remains “extremely challenging”, as a combination of inflationary pressures and unprecedented demand for services means that it is now facing a funding gap of £167m by 2021-22.

It follows the authority being slammed for failing to carry out its duty to run libraries in the region back in April, as a civil society minister said its decision to close a number of services was “predetermined”.

The CC also rejected a four-year funding settlement from DCLG back in October 2016, with its deputy leader at the time, Cllr David Borrow, arguing the settlement would mean the authority would not be able to balance its books in the near future.

At that time, the deficit was expected to rise to £79m by 2020-21, a figure which has more than doubled since then.

Leader of Lancashire County Council, Geoff Driver, stated: “The county council’s financial situation is clearly extremely challenging and one of our key priorities is to create a more financially stable council that will enable us to future-proof our improvements to critical services for the most vulnerable in our communities. 

“This detailed line-by-line review of all service budgets has identified significant savings and is a very helpful first step to putting the council's finances on an even keel.”

Driver added that the authority would clearly need to make more savings in the future, and that councillors were working very hard to look at how Lancashire can do that in a way that allows it to protect frontline services. 

“Every council in the country has to make decisions about how it uses its resources and we are absolutely committed to funding those services that we know people value, by reopening libraries, investing in good quality roads and local environments, and supporting bus services,” he concluded.

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