A council faces making substantial service cuts after declaring its budget unsustainable and ceasing non-essential and new spending.
While Slough Borough Council will continue to deliver its statutory social care duties, children’s and adults’ services that are not statutorily required are vulnerable to cuts as it bids to tackle a projected deficit this year of £96m. This is equivalent to 72% of its £134m budget, but is also contingent on a £15.2m government loan that will only be delivered if an external review finds the council has a credible plan to deliver financial sustainability.
The council will review its services along with internal structures, vacancies, assets and land. It will not make any new commitments to spend money, including in social care, and has suspended non-essential spending pending a council meeting on 22 July to determine specific budget controls. The constraints also apply to Slough Children First, the council-owned provider of children’s services in the borough.
The so-called section 114 notice setting out the council’s financial position said that an internal review had identified “severe weaknesses” and “poor practice” in financial management going. Borrowing has quadrupled since 2016-17, from £180m to £760m, the council has no unallocated general reserves, its 2018-19 audit has still not been signed off and estimates local income tax and collection rates have not been accurate for several years.
The housing, communities and local government secretary, Robert Jenrick, described the situation as “completely unacceptable”. The government’s £15.2m loan for the council is contingent on the external review finding that Slough has a credible plan to deliver financial sustainability without further government support. However, Slough has said that it requires a bigger government bailout than the one currently being offered.
Slough’s chief executive, Josie Wragg, said: “There is no quick fix. This will be a long process. We were on the wrong path financially, but we are committed to making the changes needed and as officers, working with the political leadership and government to reduce disruption as much as is possible.”
However, she insisted that the notice did not mean any immediate changes to services, including in social care.
Following an ‘inadequate’ Ofsted judgment, government intervention led to Slough’s children’s services being turned over to a trust in 2015. However, following longstanding financial difficulties, the trust was taken under council ownership in April, though remains operationally independent.
‘Too early to gauge children’s services impact’
Now known as Slough Children First, the trust said it was “too early” to say what the full impact would be of the section 114 notice on their services. Tony Hunter, the chair of the board, promised that Slough Children First would continue “to safeguard and improve the lives of children in Slough, with the diligence and determination we’ve always had”.
Paddy Emond, UNISON’s regional organiser covering Slough council, said: “This must be a wake-up call to Westminster about the perilous situation of councils after a decade of massive cuts to their budgets. The black hole in local government has serious consequences for communities everywhere.”
He added: “Slough Borough Council must work with unions to find a way out of this situation protecting essential services for vulnerable residents as well as the jobs and living standards of dedicated staff.”