Manchester City Council is facing a £50m funding shortfall over the next few years, with the authority’s finance chief warning they are “at a cliff edge”.
While no overspend figure has been released, the problem is thought to stem from rising costs and increased demand in the social care sector, the Local Democracy Reporting Service (LDRS) said.
The council needs to make the cuts after having already used up £51m of “smoothing reserves”, according to executive councillor for finance Rabnawaz Akbar, presenting the current budget in February.
“Then they are gone. We are at the cliff edge,” he warned.
A £5.3m social care overspend was one factor behind the council expecting to face a budget gap of £41m by the 2026/27 financial year.
However, faced with increasing costs and overspends, the LDRS understands the authority is now working on finding £50m in savings over the next few years.
The council is the latest in Greater Manchester to confirm it is facing rising costs, which is putting pressure on its budget.
Oldham Council recently announced it was projected to overspend by £25m this year, on top of an existing £11m black hole from last year, prompting the launch of a voluntary redundancy scheme.
Meanwhile, Salford is facing a £6.8m overspend, and Tameside’s figure is £680,000, mainly due to increased pressures in adults and children’s social care, as well as homelessness.
A full update outlining the size of Manchester’s overspend is due to be released in early September.
A report into the council’s finances in June said: “Robust monitoring processes are in place and future reports will be brought to the executive on the position throughout the year.”
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