Key Points:
- Havering Council’s Cabinet has approved the budget proposals for the 2025/26 financial year.
- The council faces a £70 million budget gap, including £34 million in carried-over pressures from last year.
- A 4.99% increase in council tax has been approved, in line with the referendum limit.
- Fees and charges will rise by 2.7%, along with a 2.7% rent increase for council tenants.
- Council Leader Ray Morgon has criticised government underfunding, citing rising social care and homelessness costs.
- Measures to reduce costs include AI-driven efficiencies and partnerships with the NHS to reduce care home expenses.
- A £32.5 million Government loan was taken last year, with another £70 million loan application planned for this year.
- Investments in safety, roads, parks, local businesses, and regeneration projects will continue.
- The budget will be presented for final approval at the Council Tax Council meeting on Wednesday, 26 February.
- Residents are urged to sign an online petition to demand fairer government funding.
Havering Council’s Cabinet has approved its budget proposals for 2025/26, tackling a financial shortfall of over £70 million. The budget, which includes a council tax rise of 4.99%, reflects the borough’s ongoing struggle with rising social care and homelessness costs.
Why is Havering Council Facing a £70 Million Budget Deficit?
The council has attributed the funding gap to spiralling costs in social care and temporary accommodation, coupled with insufficient government support in Havering borough. Council Leader Ray Morgon expressed his frustration over the deepening financial crisis, stating:
“Astronomical costs for social care and temporary accommodation, coupled with year-on-year chronic underfunding from successive governments, have left us in a dire position.”
Despite continued lobbying efforts, the council has yet to receive significant financial relief from the government.
How Will the Budget Shortfall Be Addressed?
To bridge the funding gap, the council has approved several financial measures:
- Council Tax Increase: A 4.99% rise to the maximum allowed without a referendum.
- Fees and Charges Adjustment: A 2.7% increase in fees for council services.
- Rent Increase: Council tenants will see a 2.7% rent rise, lower than last year’s hike.
- Government Loan: An application for at least £70 million in additional government borrowing will be submitted.
What Cost-Saving Measures Are Being Implemented?
The council is exploring radical new solutions to cut costs, including:
- Using AI to improve efficiencies and reduce expenditure.
- Partnering with the NHS to transition elderly residents from hospitals to their homes, reducing care home expenses.
- Reworking homelessness strategies to minimise reliance on costly hotels and temporary accommodations.
What Investments Will Continue Despite Budget Cuts?
Despite the financial strain, the council has pledged to maintain key services and projects, including:
- £18 million investment in council housing improvements.
- A new borough-wide CCTV system for enhanced safety.
- Sustained funding for Section 92 police officers.
- Ongoing maintenance of parks and roads.
- Support for local businesses through a new campaign.
- Continued commitment to regeneration projects and new home-building initiatives.
What’s Next for the Budget Proposal?
Following Cabinet approval, the budget will now move to the Council Tax Council meeting on 26 February for final agreement.
In the meantime, Council Leader Ray Morgon is urging residents to sign an online petition demanding a fairer funding allocation from the government. He stated:
“We will keep fighting for the borough and continue lobbying the Government for a common-sense solution that meets national demand while reflecting our changing population and needs.”
Residents can sign the petition at www.havering.gov.uk/budgetpetition to voice their concerns.
