Southampton: New bid to tackle cash crisis at city council

Now local government troubleshooter Theresa Grant has been drafted in to help Southampton City Council as it struggles to close a big gap in its finances.

The authority is facing a budget deficit in the current financial year of £14.1m – down from the £29.99m forecast in June.

But its projected budget shortfalls for future years are £37.8m in 2024-25, £44.9m in 2025-26 and £52.4m in 2026-27.

Southampton City Council is struggling to fill a gaping hole in its finances (Image: Chris Yandell)

Now an Improvement Board chaired by Ms Grant has been set up to help the authority balance the books.

As reported in the Daily Echo, an independent review of the council's finances has already been carried out by the Chartered Institute of Public Finance & Accountancy (CIPFA). The Labour-run authority is using the findings to form the basis of a "robust" recovery plan.

READ MORE: Southampton City Council aims to tackle budget crisis by cutting costs and hiking charges

A council spokesperson said: "CIPFA continues to work with the council to review financial forecasts to ensure external validation.

“A voluntary Improvement Board has been established to provide external support as the council develops its improvement plan and transformation programme."

Theresa Grant pictured during a charity sleep out earlier in her local government career (Image: Newsquest)

Ms Grant was head of Trafford Council in Greater Manchester for nine years before applying for what was dubbed "the most difficult job in local government " - chief executive of Northampton County Council.

The Conservative-led authority had just been forced to issue a section 114 notice, which bans all but essential spending.

READ MORE: Leader of Southampton City Council says authority is being 'open' about its finances

Ms Grant says she applied for the post because she "couldn't bear to see something in such a mess". During the following three years, the council went from having debts of £65m to reserves of £105m.

After overseeing its financial recovery, she went on to "stabilise" Liverpool City Council.

Cllr Simon Letts, cabinet member for finance and change (Image: Newsquest.)

Ms Grant and fellow members of the new improvement board will work alongside representatives from Southampton City Council, including the leader, Cllr Satvir Kaur, and the chief executive, Mike Harris. 

The board will hold its first meeting on October 16, the day before the next cabinet session.

Cllr Simon Letts, cabinet member for finance, said:  “While we are seeing an overall improvement in our financial position, there is a significant amount of work still to do.

"The measures identified in the Cabinet report are not sufficient to close our budget gap and more proposals will be coming forward in the next few weeks, with the public being consulted where necessary."