Havering Council’s Cabinet has passed the Council’s budget proposals for next year (2025/26).
Havering Council’s Cabinet has approved its budget proposals for the 2025/26 financial year amid ongoing financial challenges. The council continues to face significant cost pressures, particularly in delivering social care and homelessness services, with a budget gap now exceeding £70 million. This shortfall includes £34 million in pressures carried over from the previous year.
To address the deficit, Cabinet has agreed to a council tax increase of 4.99 percent, in line with the referendum limit, alongside a 2.7 percent rise in fees and charges. A public consultation on the proposals saw 600 responses, with 55 percent of residents indicating support for a 5 percent or higher council tax increase, while 41 percent opposed any rise.
In addition, Cabinet has approved a 2.7 percent rent increase for council tenants. This rise is notably lower than last year’s increase, reflecting an effort to balance financial sustainability with affordability for residents.
The council continues to push for urgent government action to address what it describes as a funding crisis, exacerbated by rising social care costs, temporary accommodation expenses, and what it sees as chronic underfunding from successive governments. Despite extensive lobbying and discussions with government ministers and officials, no significant increase in funding has been secured.
The council continues to push for urgent government action to address what it describes as a funding crisis, exacerbated by rising social care costs, temporary accommodation expenses, and what it sees as chronic underfunding from successive governments.
In an effort to close the funding gap, Havering Council is implementing a series of cost-saving measures. These include new approaches to reducing homelessness and the reliance on expensive temporary accommodation, exploring the use of artificial intelligence to streamline operations, and working closely with NHS partners to manage social care costs more efficiently. Initiatives such as facilitating quicker hospital discharges and supporting residents in returning to their own homes aim to reduce care home expenses.
Alongside budget adjustments, the council has reaffirmed its commitment to community investment. Plans include an £18 million programme of improvements for council homes, ongoing maintenance of parks, and the continued regeneration of key areas to deliver new housing for residents. Additional investments are also being made in public safety, with the rollout of a new CCTV system and another year of funding for section 92 police officers.
Infrastructure improvements remain a priority, with the council set to continue its investment in road maintenance and local business support. Measures to assist vulnerable residents will also persist, particularly in response to the ongoing cost-of-living crisis.
Despite the financial strain, the council has emphasised that services will continue without disruption. Essential expenses, including staff salaries and operational costs, will still be met. However, to ensure a balanced budget, the council is preparing to apply for another government loan (Capitalisation Directive), expected to be at least £70 million. This follows a similar £32.5 million loan secured last year.
Without this financial support, the council would face the prospect of either imposing a council tax increase beyond the 4.99 percent threshold or making severe cuts to essential services. The council remains opposed to placing the burden solely on residents and continues to urge the government to provide a long-term funding solution that reflects the borough’s needs.
Havering Council has reiterated its call for residents to support its ongoing petition for fairer government funding. The budget proposals will now move to the full Council Tax meeting scheduled for Wednesday 26 February 2025, where a final decision will be made.
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