The council is in “financial peril” and will have to cut millions of pounds in spending next year to balance its books.

In new figures announced on Friday, Brighton and Hove City Council leader Bella Sankey said the chancellor’s autumn statement last week has left the council with a gap of £31 million for next year’s budget.

Previous forecasts predicted a funding gap of around £25.3 million for the financial year 2024/25.

But the city council said the autumn statement and local government settlement for next year “falls disastrously short of meeting the huge inflationary costs and increasing demand”.

It said that in the last 13 years, the government has slashed the council’s budget by £120 million in real terms.

The “very large shortfall in funding” will mean “extremely difficult decisions being taken to protect essential services”.

The Argus: Council leader Bella Sankey wrote to the ChancellorCouncil leader Bella Sankey wrote to the Chancellor

Councillor Sankey wrote to Chancellor Jeremy Hunt calling for a fair deal for the city in his autumn statement.

On Friday, she said: “The council’s finances are in an extremely perilous position. 

"There was absolutely nothing in the autumn statement to provide relief for this council or local authorities who have faced a decade of heartless central government austerity or any real-world financial help for struggling families.

“Demand for our services is increasing, especially in key areas like adult social care, children with special educational needs and disabilities (Send) and homelessness, which is putting pressure on other services.

“Even the government’s own Household Support Fund, which allowed the council to give extra help to households in Brighton and Hove struggling to pay for food, energy and other essential costs, is being cut.

“We’re being forced to look at every one of the 400 services we provide and start the extremely difficult process of deciding what are priority services and what aren’t.

“To put it bluntly, the less money we have the less services we can provide.”

The local government funding crisis has already seen many councils throughout the country issuing a Section 114 Notice, effectively declaring themselves bankrupt.

The Argus: The Chancellor Jeremy Hunt delivered his autumn statement last weekThe Chancellor Jeremy Hunt delivered his autumn statement last week (Image: PA)

Although Brighton and Hove is not in this position yet, it is in “financial peril”, the council said.

Cllr Sankey added: “While we await the final detail on the local government settlement, we will almost certainly have to find millions more savings next year than planned because the government has chosen to ignore the crisis in local government funding.

“I want to reassure all of our residents we are doing everything we can to make service improvements while balancing the council’s budget, which is a legal requirement.

“We’ve had a staff vacancy freeze at the council for most of the year, worked quickly with officers to find in-year savings this year and have been working on budgets and savings for next year.

“The disastrous autumn statement means that we now have even tougher decisions ahead but must find ways of reorganising the council to ensure we are at the very least providing basic and essential services.”