Oxfordshire county council faces £25m shortfall

A budget black hole has grown to £25m at Oxfordshire County Council.

The authority said in October that it had a shortfall of £13.9m for the financial year 2025/2026.

But since then extra pressures have arisen, including the rise in employer contributions to National Insurance announced by the Chancellor.

Those running the authority said they hoped the £1.3bn for local councils also announced by Rachel Reeves would close its funding gap - but they have not been told yet how much Oxfordshire will get.

Dan Levy, who is the Liberal Democrat county councillor responsible for finance, said that he was "anxious" that Oxfordshire should get a fair share of that funding.

"We're waiting for the government to tell us how much money we're going to get and they're being very guarded at the moment about that," he said.

"But I'm hopeful that in December when the [local government] settlement is announced we will get a large amount of money from central government, which we need."

The county council's draft budget has been written based on a presumed council tax rise of 1.99%.

But the government announced on Thursday rises would be capped at 3%, unless authorities held a referendum, with an extra 2% for those with responsibility for adult social care - such as county councils.

The government also pledged local government would receive a real-terms increase in core spending power of around 3.2%.

Deputy Prime Minister Angela Rayner said: "For too long councils have been let down by an outdated and inefficient funding system which has led to public services creaking and taxpayers’ money not being spent efficiently.

"Whilst there’s no magic wand to fix what we’ve inherited, we’re taking the necessary steps to fix the foundations of local government by creating a fairer system and ensuring every penny is spent on the services so many people rely on every day."

The county council's draft budget includes a £1.5m investment to improve highway drainage, following this year's flooding.

An extra £1.141m will be spent on services for children with special educational needs and there will be £1m in funding for early years support.

Savings would be made through a "forensic review" of spending on goods and services, with the aim of cutting £5m, the council said.

There will also be a 2.7% reduction in staffing costs through reducing the use of agency workers, not automatically recruiting to vacant posts, internal recruitment and potential redundancies.

A consultation on the proposed budget will run until 2 January.

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