Hampshire’s fire authority has said it will be £6 million short this year – but officers are confident the deficit can be bridged.

Officers said that the authority could reduce the gap to £3 million if it followed a series of recommendations in February.

Hampshire and Isle of Wight Fire and Rescue Authority reported (December 17) that the £6 million deficit for 2025/26 is down to four reasons.

They include the increased cost of ill health and injury pensions, which amount to £200,000, and the additional inflation contingency proposed as a “prudent” measure, which would cost £520,000.

However, the fire authority indicated measures could be taken in February to reduce the budget to £3.339m.

The introduction of council tax premiums for second and empty homes could generate an extra £500k for the organisation.

If the council tax were increased in February to the referendum limit of £5, which would be 6.04 per cent for the authority, it would reduce the forecasted gap by £2.420m.

Savings totalling £489 million have already been identified to be used to bridge the gap.

The authority’s chief financial officer Catherine Edgecombe said she is “hopeful” that the budget deficit will be the smallest after she learns more details on the Local Government Finance Settlement.

She said: “Then, what we would do is the first call on closing that gap would be our budget equalisation reserves, which are reserves we hold for that purpose. We would then look at other reserves. As a last resource, we would reduce our annual contributions to reserves to bridge that gap.”

Ms Edgecombe reassures members that she is not concerned that the fire authority would be unable to set a balanced budget.

“We aren’t in the position of not being able to bridge the gap, but obviously, then any reserve funding we put into closing the budget gap is money we can’t spend on investing in our estate and assets, so it is always a difficult decision, but I’m not concerned that we would be in the position of not being able to set a balanced budget.”

The increase in employer’s National Insurance and a reduction in thresholds announced by the government could generate around £1.4m extra pressure on the fire service.

However, the government has said all public authorities will receive a grant to cover the full cost of the increase, but she warned that the real risk is how the grant will be allocated between authorities.

“It is one of those examples where the devil is in the detail,” she said.

For the year 2024/25, the authority had an underspend of £740,000 relating to on-call firefighters, which is largely due to lower activity levels and ongoing recruitment and retention challenges.

As a result of staff vacancies, the organisation also has an underspend of £691,000.

On the other hand, transport costs related to travel between the mainland and the Isle of Wight and higher costs for maintaining and repairing vehicles caused the authority to overspend £117,000.