Spending at Dorset Council is likely to be £10.25 million adrift by the end of the financial year – after just three months so far.

Finance portfolio holder Cllr Gary Suttle said the authority is being hit in all directions by inflation … and has yet to quantify what a staff pay award will cost.

He told Cabinet members that the figure represented “a significant difference” between what was planned for and what is happening, with the Place directorate and Dorset Travel particular areas of concern.

“It’s not one issue or problem, it’s numerous,” he said, although he added that he would wait until the half-year figures are in, in the autumn, before deciding whether of not to work on a revised budget.

The Purbeck councillor also warned that savings targets, of more than £5 million, were now looking doubtful while he feared there was a chance that the council’s £8.6 million revenue contingency fund might not be enough to see the authority through the financial year.

He also said that the capital budget was suffering “slippage” and might need adjustment.

“I will not shy away from the fact that this budget is under considerable pressure and there’s considerable work to be done in the coming months,” he said.

Cllr Suttle said the warning about finance, followed by everything turning out alright by the end of the year, might sound like a B-Movie script, but he said the only way it could end that way was by considerable hard work and continuing to find savings.

He said that among the issues being tackled was the level of council tax collection with some people struggling to pay, although the business rate situation had improved.

Cllr Suttle said the authority was also focusing on debt collection although he said a council the size of Dorset was bound to have what he called “trading debt.”

A the  previous, June Cabinet meeting, Weymouth councillor David Gray had calculated the council was owed around £47 million, while another Weymouth councillor, Brian Heatley, had noted that the ear-marked reserve funds held by the council were predicted to diminish from £158 million to £40 million and, he warned, could be gone altogether in two years.

Among the council’s debts at that time was £10.4 million which has been due for more than a year; £6.6m for between 90 and 365 days; £2.8m owing for 30-90 days and £19.6 due for less than 30 days.

Unpaid council tax described as “historic arrears” amounted at the time to £24.8m with £7.3m owing in business rates.

On the plus side Portfolio holder for corporate development and transformation, Cllr Jill Haynes, said at the June meeting that council’s transformation programme, by combining previous councils and finding more efficient ways of working, was continuing to deliver savings with £13.6m achieved in the first two years and £31 million projected over the five years to 2026.