Stoke-on-Trent City Council is still facing a 'hard road' despite securing £9.14 million of transformation funding, councillors have been told.

The council was allocated the funding by government to make improvements to children's and adults' social care, cut overspends and reduce the authority's reliance on emergency bailouts.

But strategy and resources scrutiny committee members were told that the council's financial situation remains 'bleak' and that it will take years for the transformation work to turn things around.

The financial performance report for the first quarter of 2026/27 shows the authority is predicting a £6.7 million overspend for the year, mostly due to pressures in children's and adult's services.

Nick Edmonds, corporate director for resources, told the committee that the council faced long-standing 'structural' problems such as a low tax base and high levels of deprivation.

Work to reduce the cost of services – such as bringing down the number of children in care through early intervention – would be a 'hard road and a slow burn'.

Mr Edmonds said: "It's really positive that we have that transformation funding, and it will make a difference.

"But I'm still really concerned about our financial position. Despite the changes in the funding formula, despite the significant steps that we've taken, the demand challenge is just not abating.

"We'll continue with the transformation and try and bring the numbers down, but there's a real challenge out there, in society and across the economy.

"Real demand pressures and real inflationary pressures that are out of our control."

The council is facing a £4.4 million overspend on children's care placements alone, with 1,068 youngsters currently being looked after by the authority.

Increased demand for adult's social care, increased complexity of care needs and higher costs in the sector account for a further pressure of £6.3 million.

These overspends are partially offset by underspends in other council services, such as the Hanford incinerator and commercial rental income.

Mr Edmonds expects the overall projected overspend to get worse.

He added: "It continues to be a very stormy and challenging financial position for us. I'd love to be able to come to you and say I think things will be better in quarter two, but I don't, I think it will be more challenging with the numbers that we're seeing."

Councillor Sarah Hill, cabinet member for finance, told the committee that the cabinet and directors would be meeting to discuss the council's financial situation on Friday.

She said: "We'll be looking at next year's budget and where we're going. It's a very difficult situation we're in, there's no getting away from it."

The city council was one of 14 local authorities to be awarded transformation funding, due to its previous dependence on exceptional financial support (EFS) to balance its budget.

The council has been allocated more than £60 million of EFS over the last three years.