Increase in expenses for children leads to request for £15 million bailout

Redcar and Cleveland Council is seeking a 15 million bailout from the government, citing a sharp rise in children's social care expenses as a key factor. Ahead of next weeks cabinet meeting, a report highlighted that the Labour-led council is also considering a 4.99% council tax increase, the maximum permitted without holding a referendum.

The councils report described ongoing "sustained and significant budgetary pressures," largely stemming from escalating spending on childrens social care. Labour councillor Neil Bendelow, a member of the resources committee, noted that the council has long been underfunded and is now facing a critical financial juncture.

Over the past four years, the council has implemented 20 million in budget cuts. Additional government funding, to be repaid over time, is seen as an essential step toward achieving a more stable fiscal situation. The report stated that the government recognizes some local authorities require temporary support while reforms to the previous funding system are implemented.

Upcoming Financial Challenges

If the councils application for financial aid is approved, the exact amount and confirmation are not expected until February. This timing may create a tight window for finalizing the 2026/27 budget. Following a statutory consultation with residents, the proposed budget and council tax rate will be presented to the full council on 26 February.

Phil Winstanley, assistant director of finance, warned there is a "some risk" the council may need government assistance again in 2027/28, though this will be continually reviewed. He added that the requested sum represents the lower end of what other authorities have applied for in similar circumstances.

Author: Ava Mitchell