By Don Mort, local democracy reporter
A financial crisis facing the city council has continued as the expected overspend for this year rose to almost £40m.
The forecast deficit for 2025/26 was up by more than £10m between August and September, latest figures show.
Leeds City Council said the costs of social care and keeping at-risk children safe were mainly behind the increase in its overspend position to £39.5m.
It means the council could be required to find more savings and dig into cash reserves to balance this year’s budget.
A financial report said: “This could include action to reduce spending, income generation or other measures to bring budget pressures under control for the rest of the year.”
The biggest overspend was on the Children and Families budget, up £12.8m since August to £28.7m.
To cut costs, the council has been working to reduce the number of youngsters living in costly residential placements outside the city.
The adults and health budget was also predicting a £15.1m overspend, up £2.7m since August.
Budget controls included restrictions on the use of purchase cards at the council, which already needed to save more than £100m this financial year.
The report said a “complete recruitment freeze” was now in place, except for front-line jobs like social work or some income-generating posts.
It said: “Furthermore, additional more stringent cost controls, with central challenge and sign-off of any expenditure over £500, are being introduced from November.”
Restrictions on travel costs would remain, along with controls on overtime and agency staff.
“No travel should be undertaken unless it is required for the essential delivery of a service or in very exceptional circumstances,” the report said.
The finance report will be discussed at the council’s executive board meeting on Wednesday (November 19).
A separate report on revenue savings proposals up to 2028/29 will also be presented to councillors.
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