Sefton Council plans to freeze recruitment until 2027 after its forecast overspend for the year almost doubled in two months, according to a Cabinet report published this week.
The local authority told OTS News in response that it “has a clear plan to deliver long-term financial sustainability” despite operating “in extremely challenging financial conditions.”
The Council said this week it expects to finish the 26/27 financial year £7.7m over budget, which has risen from a £4.3m overspend predicted in June.
The report asks councillors to approve a freeze on new hires until the end of the financial year, and implement a ban on new spending.
In expectation of financial pressures, £9.3m was set aside by the council in February for future overspends. That entire cushion has now been used or allocated. Further savings on pension contributions and highways brings the net forecast overspend down to £7.7m.
Sefton Council finished 2025/26 with a £10.4m deficit, which it covered by spending £12.1m of earmarked reserves and almost all of its general balances. A council report from July put “general balances” at just £9,000, down from £10.4m a year earlier while earmarked reserves fell from £20.8m to £3.2m.
The budget for children’s social care in this financial year is £97.3m. The council expects to spend £109.4m, an overspend of £12.1m.
In July, Sefton Council said that its projected overspend for the £141.4m adult social care budget was £0.4m. In this most recent update the overspend has grown to £1.9m. No reasons for this growth are provided in the report.
Sefton had previously committed to finding £5.5m worth of savings in the adult social care budget this financial year. The report confirms it has found £1.2m which it calls “below expectations”.
The council’s capital program, the list of major infrastructure works it expects to complete, has had spending expectations cut from July’s £148.5m to a newly-published figure of £118.7m. The capital program is mostly funded by government grants, Liverpool City Region grants and loans that the council pays back over the life of the asset.
Southport Pier’s £12.6m budget for this year is unchanged, with £7.5m to follow in 2027/28.
A Sefton Council spokesperson said: “Sefton Council, like local authorities across the country, continues to operate in extremely challenging financial conditions.
“Growing demand for essential services, particularly children’s and adults’ social care, is placing significant pressure on council budgets, making this very much a demand-led financial challenge.
“Despite these pressures, the Council has a clear plan to deliver long-term financial sustainability while continuing to provide the services residents rely on. The financial position is being closely monitored and managed throughout the year, and we continue to work with Government and partners to secure the best possible outcomes for Sefton.
“As part of this approach, we are scrutinising every pound we spend to ensure it delivers the greatest possible value for our residents and communities. This includes carefully reviewing services, spending and investment decisions to make sure resources are targeted where they are needed most.”