Councillor Ray Morgon. (Image: LDRS)
(Written by Local Democracy Reporter, Josh Mellor)
Various cuts and increased charges have been tabled for the council’s “on the brink” budget for 2024/25, which would come into force in April.
However, in response to public concerns, pay and display charge increases have been halved to 20%, Havering’s cabinet member for finance confirmed on Wednesday, 7 February.
Chris Wilkins said car parking in the borough’s parks will remain free pending “further reviews” and plans to charge for parking on Sundays have also been dropped.
The budget changes come as the council awaits a £54million bail out loan from the government.
Parking charge increases had been proposed in a bid to rebalance the budget by £12m through cost cutting and income generation.
The loss in anticipated parking income will be replaced by a reduction in funding paid to the East London Waste Authority and a £2.2m increase in funding from the government.
Havering is expected to overspend its budget by about £20m this year and has an estimated shortfall of at least £14m in the coming financial year, which starts in April.
Leader Ray Morgon said the loan is the council’s only hope of avoiding declaring itself effectively bankrupt, by issuing what is known as a section 114 notice, because it cannot balance its books.
If a section 114 is issued, government-appointed commissioners would likely take control of the council and democratic control would be “out the window,” he told cabinet as its members approved the amended budget yesterday.
Most of the demand comes from soaring costs of social care for the elderly, protecting children’s welfare and supporting the growing number of homeless residents.
Cllr Wilkins, who oversees the borough’s finances, said Havering faces a “bleak future” unless the government addresses “chronic underfunding of the social care sector nationally”.
The government has repeatedly refused to comment on complaints that it has not updated the formula for funding councils since 2011.
In total, Havering will receive about £41.5m in funding from the government in April, a below-inflation 4.49% increase compared to this financial year.
The government’s funding package assumed that the council should increase its share of council tax by 4.99%, which has now been approved by cabinet.
Havering’s 2024/25 budget must now be approved in a final vote by all councillors on 28th February.Tags: Havering, Havering Council
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