Leeds City Council has put forward its initial budget proposals for this year, planning to achieve additional savings of around £106.4 million as a result of rising costs and demands, particularly in social care, for the 2025/26 fiscal year.
Like many other local authorities nationwide, Leeds is grappling with significantly higher costs to maintain services and a growing demand, particularly in the realm of social care. This includes care for vulnerable children and adults. The council is experiencing challenges in managing the needs of looked after children, especially those who are most vulnerable and require expensive external placements. Additionally, there is a rising demand for adult social care services, particularly for the elderly, adults with learning disabilities, and individuals requiring mental health support.
The recent statistics from Leeds illustrate the extensive impact of the national care system for children in external residential settings, a challenge shared by councils throughout the UK. Over the past four years in Leeds, the expenses related to caring for children in external residential facilities have surged by 75%, climbing from £68 million to £119 million this year. The average cost for each child in an external residential placement has increased by 45% since the 2021/22 period, now averaging £6,300 weekly, or £340,000 annually. For children with particularly complex needs, the costs can reach up to £1 million annually per child.
Additionally, the adult social care sector has seen a 20% increase in the number of working-age adults and seniors receiving support over the last three years. Concurrently, the budget to meet the rising demand for these groups has escalated by £100 million during this timeframe.
Leeds City Council’s draft budget for 2025/26, aiming for total savings of around £106.4 million, already includes £23.8 million integrated into the financial plan. At their October meeting, the council’s executive board examined proposals amounting to £37.4 million. An additional £45.3 million in proposals is set to be evaluated to comply with the statutory requirement for councils to present a balanced budget annually.
The budget plan proposes a 4.98% increase in council tax, with 1.99% of this increase allocated specifically to cover rising adult social care costs. Last fiscal year, Leeds had the lowest council tax among England’s major core cities. The council is actively reviewing and assessing all assets and services to explore potential contributions to alleviating financial pressures. Additionally, Leeds City Council has implemented a hiring freeze along with a curb on non-essential expenditures, except those critical for health, safety, or legal obligations.
Leeds City Council’s initial budget proposals for this year outline specific areas for consideration to meet the required savings:
Review of non-statutory grants in adult and health services;
Assessment of in-house care delivery services and day opportunity facilities;
Evaluation of the impact of preventive programs in adult social care;
Passenger transport services within social care;
Transport cost reductions in children and family services;
Strategies to reduce the number of children in the Leeds care system, ensuring timely and appropriate support;
Integration and review of children’s centers and local services in Leeds;
Potential leasing options for Middleton Leisure Centre;
Consideration of ‘Pay as you Feel’ admission fees at city center museums and galleries;
Proposed closure of Abbey House Museum;
Examination of community committees and local working practices;
Public consultation on potential savings and revenue options for bowling green facilities;
Review of print and sign services.
The savings proposals reviewed in October and December are expected to lead to a reduction of 243 full-time equivalent positions within the council. There is a strong commitment to consulting with unions to avoid, minimize, and mitigate compulsory redundancies. However, the substantial financial challenges anticipated for the 2025/26 fiscal year may make such measures unavoidable.
Leader of Leeds City Council Councillor James Lewis said:
“The large increase in demand for many services, particularly social care, means we need to take action to ensure we meet our legal requirement to balance the council’s budget each year. Around 60 per cent of the council’s budget is spent on social care in Leeds, and the increase in council tax helps towards this.”
Moving forward, Leeds City Council expects to find additional savings of £35.2 million for the 2026/27 fiscal year and £29.6 million for the 2027/28 fiscal year.
