Homelessness Puts Pressure On Current Year's Budget

More hard times are ahead at Brighton and Hove City Council despite ending the most recent financial year with a £1.1 million surplus.

The Labour deputy leader Jacob Taylor said that the cost of supporting the homeless was already proving challenging in the new financial year which started in April.

Councillor Taylor, the council’s cabinet member for finance, said that the first formal update for the current financial year would be reported to the cabinet next month.

When the cabinet met yesterday (Thursday 26 June), Councillor Taylor said that the council had pulled itself back from a potential £11 million overspend – the amount estimated last July.

But ensuring the council ended the financial year £1.1 million in the black had put a “huge amount of pressure” on council staff.

There had been a hiring freeze and other controls on spending, with teams were having to work short-staffed while still delivering the council’s 700 services.

Councillor Taylor said:

“It’s a good result from the authority but doesn’t put us out of the woods by any means.

“Indeed, we will see in the first couple of months of the new financial year that there are very significant pressures, particularly in the area of temporary accommodation, on our budget.”

The council had previously kept about £9 million in reserves, also known as the working balance, but this figure had fallen to just under £6 million in 2023 to cover an overspend.

As of March 2025, the reserves stood at £7.8 million, he said, and the £1.1 million underspend would help replenish the working balance. This could enable the council to absorb unexpected costs.

But Councillor Taylor said that the £9 million was still a relatively low figure – and, out of 62 unitary councils, Brighton and Hove had the seventh-lowest reserves as a percentage of spending.

The Labour leader of the council Bella Sankey said:

“It’s taken a lot of hard work and effort to achieve, with tough decisions for staff and unavoidable impacts on service delivery.”

Councillor Sankey added:

“It does mean we’ve entered the new financial year in a stronger position than we expected a few months ago. This is a great start.

“But, as with all local authorities, we have significant financial challenges and service pressures ahead. There’s much more we need to do to build our reserves and ensure we remain financially resilient.”