SOMERSET Council is “breathing slightly easier” over its financial position after managing to balance its books for the last financial year.

The council declared a financial emergency in November 2023, and only managed to pass a balanced budget in February by committing to the maximum possible rise in council tax, the sale of around £20m of non-operational assets and implementing savings of around £35m.

Since the budget was approved, the council has been working to stave off the threat of effective bankruptcy – including a rigorous transformation programme (which is leading to staff redundancies), identifying buildings which can be sold off and reviewing its borrowing levels.

The council has now confirmed that it managed to balance its books for the last financial year, and even achieved a slight underspend in the process.

It is also forecasting a smaller underspend for the current year – though great uncertainty remains going forward.

The council’s financial position was discussed at length when its executive committee met in Taunton on Monday, September 2.

In the 2023/24 financial year, the council achieved an underspend of around £1.8m, or around 0.3 per cent of its total annual revenue budget.

This sum has been added to its general reserves, meaning it can be used in the coming months and years should costs in other areas rise.

Deputy leader Liz Leyshon said: “This has made breathing slightly easier for a while this summer – but not for long.”

In the current 2024/25 financial year, the council is currently forecasting an underspend of £200,000, based on the spending figures for the first three months of the financial year.

Spending on some areas of the council has been brought under greater control, with savings being made on adult services through extensive commissioning work, which has brought down the fees associated with both residential placements and weekly nursing visits.

However, spending on other areas is still higher than forecast – particularly in children’s services and waste services, caused by the additional payments being made to Suez to protect the existing contract).

Chief executive Duncan Sharkey added: “This has given us a lot more stability in terms of what we can do.

“We are still in difficulty, in that we are still spending more than we raise, technically. But we’ve got a lot more things in the action plan which will hopefully deal with that.”

Within the capital budget (which includes new roads, schools and major regeneration projects), around £74m of spending is subject to “slippage” – meaning it will be spent in the next financial year or later, rather than before April 2025.

Much of the slippage has been caused by the unavailability of contractors, clashes with other schemes or the “re-profiling of legacy projects” from the former district councils, where projects have been reassessed in light of high inflation within the construction industry.

Council leader Bill Revans has reiterated his call on the new Labour government to address how local government is funded, arguing that the ongoing financial issues would persist without much-needed reforms to council tax and business rates.