More evidence has emerged of Hart’s Finance car crash. The black hole at the heart of Hart Council’s medium term finances is growing. They recently published their draft accounts for last financial year which updated the medium term financial plan (MTFP).
This shows that the expected deficit for FY22/23 has expanded to £1,175K and the deficit for FY23/24 will be £1,413K.
Hart Council Medium Term Financial Plan
This represents a massive deterioration compared the the forecast provided in last year’s accounts and to Cabinet as recently as December 2020. At that time they forecast zero deficit in both years.
Hart MTFS presented to Cabinet December 2020
They got closer to reality at the time of the budget in February 2021. However, the FY22/23 deficit has grown from the £1,018K estimated at that time.
Hart Council budget deficits 2021/22 and 2022/23
Even these horrifying numbers are optimistic. They assume £499K of as yet unidentified savings will be made in FY22/23 and £796K in FY23/24.
If they manage to make the savings, then the deficit will still be 10.7% of their budget in FY22/23 and 12.5% in FY23/24. If those savings don’t materialise then the deficits will be 15.1% and 19.6% respectively. These are huge numbers. Even more troubling is that there doesn’t appear to be any formal committee set up to deal with the issue. However, they have recently bought an office block in Basingstoke. The income they receive may help to close the gap.
Crumb of Good News in Hart’s Finances
The only crumb of comfort is that the estimated deficit for this financial year has fallen from £381K when the draft budget was signed off to £179K in the MTFP. This seems to reflect that they have received £270K of extra income for Shapley Heath (£130K) and Recycling Credits (£140K) not included in the draft budget. However, this extra income should have seen the deficit falling by £270K, not £202K.
Shapley Heath still burning money
It is galling to see that money is still being squandered on the entirely unnecessary Shapley Heath project when the overall financial position is so dire. The Council are fiddling while our money burns.
We have asked questions about these and other issues to be answered at Council on Thursday 29 July. They can be found here.