Nottinghamshire, Mansfield and Ashfield councils confident their finances are in good shape

The city council issued a ‘Section 114 notice’ because it expects it won’t have enough money to cover its costs in the current financial year and is facing a budget deficit of £23m.

Coun David Mellen (Lab), the council leader said while he accepted past decisions had cut its reserves, the authority’s decline pointed to a worsening national picture for the finances of local councils.

By law all councils must be able to set a balanced budget – meaning they do not spend more money than they receive in 12 months.

The Local Democracy Reporting Service has asked both the county and local district and borough councils for their latest financial positions as of December 1.

A report that went before cabinet in November revealed Nottinghamshire Council as running at £700,000 over-budget for the financial year – around 0.1 per cent of its annual budget.

However, it is confident this will be closed within the financial year.

Coun Ben Bradley MP (Con), council leader, said back in November: “We’re in a reasonable position given the challenges everyone is facing.

"We are managing the situation well.”

Senior councillors were hopeful of closing the gap, and said it compared favourably to other nearby county councils such as Derby, which has a £46m predicted overspend.

Over the next three financial years to 2026-27, it is estimated the council will spend £60.2m more than it brings in, although this gap too could close.

Mansfield Council currently has an in-year deficit of £86,000 for 2023-24 and says it is working with all departments to make in-house savings and set a balanced budget for the next year.

It had already earlier set aside £222,000 from its reserve fund to meet this year’s gap.

However, this will be increased to £306,000 to cover the current deficit.

Ashfield Council reported that it doesn’t have a deficit, and its current forecast spend is ‘significantly within budget for this financial year’, meaning no reserves will need to be used.

Newark & Sherwood Council said as at quarter one, its forecast showed that a shortfall of £20,000 for the general fund may need to be met by reserves.

However, as at quarter two, the authority said it is indicating that £422,000 would be transferred into the reserves, meaning it does not have a deficit.