Harrogate council facing ‘sizeable overspend’ of £2.5m

Harrogate Borough Council is forecasting to spend £2.5m more than budgeted in its final year of existence, a meeting has heard.

The council’s revenue budget for the year is £21.8m and it was predicted to overspend on this sum by £701,000 at the previous quarterly update in July.

But last night’s overview and scrutiny committee heard the figure had increased to £2.5m in the latest quarterly forecast for the period to October.

Gillian Morland, service finance manager at the council, said the “two really big variances” were utility prices and larger than expected staff pay increases.

Gillian Morland, HBC

Gillian Morland speaking at last night’s meeting.

Ms Morland said utility bills were £1.7m above budget and staff pay was £1.1m higher than expected following the 2022/23 pay award.

She told the meeting the council had locked into a 12-month rate for electricity but gas prices were “more complicated and it is possible we could see a reduction of up to £600,000 on the overspend that’s quoted in the report”.

She added the council had budgeted for a 2.5 percent pay increase and the agreed figure turned out to be almost 6.7%.

“As things stand we are looking at a sizeable overspend this year.

“We are hoping overspend will come down but we do have sufficient funds to cover it.”

John Mann, the Conservative councillor for Pannal, told the meeting the overspend was “typical of most councils”, which were dealing with similar issues relating to rising utility bills and pay awards.

Harrogate Borough Council is one of seven district councils, which along with North Yorkshire County Council, will be abolished on April 1 to make way for the new North Yorkshire Council.

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