A North London council has issued a stark warning about the need to take ‘difficult decisions’ regarding cuts to public services over the next few years. The local authority has estimated a budget gap of £16m for the 2025/26 financial year, potentially rising to £30m by 2027/28.
Brent Council’s finance department highlighted the ‘significant risks, issues and uncertainties’ it faces over the coming years to meet a growing demand for services in the borough. A report published by the department lays bare the challenges it faces to balance the books, having already made cuts totalling more than £210m since 2010.
February’s budget revealed a need to plug an £8m gap to make sure it could continue to deliver core services to residents for 2024. But the Deputy Leader and Cabinet Member for Finance and Resources, Cllr Mili Patel, said the council is likely to require further ‘significant savings’ over the next few years to deliver a balanced budget – particularly due to growing pressures to continue providing social care and homeless support.
Published prior to the recent general election result, Cllr Patel described the picture painted by the report as ‘sobering’, with difficult decisions needing to be made about ‘which services to prioritise and protect, and which to reduce’.
Cllr Patel said: “[…] officers and members will be asked to identify a staggering £16m in cuts if this council is to continue standing still as we are today. There is no doubt, these cuts will be challenging for residents and for officers and members alike.”
She added: “It is therefore unconscionable to consider that things could still get worse. If things remain the same, the best estimate for 2027/28 is that we will need to find in the region of £30m in savings. Without intervention, we will enter freefall, heading towards the ground, with no easy way to pull back. Plainly, this will mean the functions that this council will be able to perform will be changed irreversibly, allowing for only the most vital services to remain.”
Over the 2023/24 financial year, the council revealed that it ‘broke even’. However, £13.5m of earmarked government funds had to be used to ‘manage unexpected pressures’ – namely due to the pressures on housing services. The residential services department had an overspend of £11.2m because of the ‘extremely high levels of demand’ for homeless services.
More than 150 families are presenting as homeless every week, according to council figures. The report sets out a further £10m overspend on temporary accommodation to support those in need. The issue is being exacerbated by a lack of housing, both in the borough and in London more widely. However, rising interest rates and building cost inflation due to the war in Ukraine has impacted development.
Cllr Patel claimed many housing schemes are ‘shovel ready’ but without increased subsidy the borrowing required means the numbers ‘simply don’t stack up’. Following the election of a Labour government earlier this month (4 July), the council hopes that ‘economic stability’, alongside planning reforms and the possibility of multi-year funding settlements – rather than the current annual settlements – could be a ‘turning point’.
Addressing a recent Cabinet meeting (15 July), council Leader, Cllr Muhammed Butt, said the challenges it faces are ‘not insignificant’ and it is becoming ‘more and more difficult’ for the local authority to continue to deliver critical services.
Cllr Butt said: “The demand and the need continues to grow. Some of the needs are becoming more and more complex, which adds to the issues and challenges. We want to remain one of those boroughs that continue to build and hopefully some of the reforms that will be coming through will enable us to continue that growth that we need.”
He added: “Some of the challenges we are going to be facing are quite substantial. […] We do have to be serious about how we support residents going forward and how we target some of the support. When you take a look at the amount of money that’s being spent on the council tax support scheme, the Brent Hubs, and all the other schemes, I think [there’s an] opportunity for us to revisit some of these and make sure we are targeting that support.”
