DENBIGHSHIRE County Council’s predicted £5.5m overspend has been reduced thanks to staff working from home and the end of COVID lockdowns.

The cash-strapped authority is struggling to make ends meet in the face of the cost-of-living crisis as inflation hits construction projects and energy prices soar.

Consequently, the council tasked its finance officers with making cutbacks to free up funds.

Whilst the authority is still expected to go over budget by around £2.1m, the council’s head of finance said the situation had improved.

Cabinet members were discussing the finance report outlining the council’s revenue budget and savings as agreed for 2022/23.

The purpose of the report was to provide an update on the council’s current financial position and confirm the agreed service budgets for 2022/23.

Councillors backed the report.

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Speaking at this week’s cabinet meeting, finance head Steve Gadd commented: “The main story if you like is that last month we were reporting a £5.5m overspend.

“It is always a good thing to keep within budget as much as possible. But obviously this year it is even more critical due to the budget strategy for next year, which we are hoping to utilise reserves to help fund.

“The majority of the savings we’ve found, so £3.4m almost, has come from corporate items.

“There is a declared underspend on capital financing budget of £1.5m. This is mainly due to delays in projects which happen most years.

“We’ve also managed to release another £400K from contingency. If you remember last year we put in a contingency – £1.9m for COVID – well the COVID expenditure hasn’t happened because we haven’t had to lockdown again.

“So we’ve been able to use that COVID contingency for that increased pay award, and this £400K is what is left of that contingency, and the final one (saving) is a new-ways-of-working saving, so this is just reviewing all the budgets for mileage.

“Obviously our staff are not travelling from office to office, et cetera.  There is a saving there of £230K, so we’ve declared that as well.”

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Mr Gadd explained delays in recruitment had also freed up around £1m as many council staff were doing extra work to cover vacant positions.

“The balance of about £1m has come from services,” he said.

“As you know, there is a recruitment problem. We are finding we are having to go out once, twice, three times in some cases to find the right candidate for posts, so it does mean, as you go through the year, there are more vacancy savings.

“And the other one is use of service reserves. We are asking services, ‘if you are overspending, look at your reserves. Can you apply some of your reserves in-year to help with the corporate position?’”

He added: ” We have managed to bring that overspend down to £2.189m, which does allow us £2.7m will be left in the budget mitigation reserve, which can help with the budget position. So we are in a lot better position this month than we were last month.”