Council faces substantial cuts after declaring unsustainable budget

Slough council has been forced to suspend all non-essential spending after admitting it will be unable to meet its budget, putting non-statutory social care services at risk

Budget cut
Photo: ducdao/Fotolia

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.

‘Completely unacceptable’

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.”

7 Responses to Council faces substantial cuts after declaring unsustainable budget

  1. Ray Jones July 7, 2021 at 7:00 pm #

    Absolutely awful, especially for children and families, disabled people and social workers and others in Slough. Mr Jenrick is right. It is ‘completely unacceptable’. What is unacceptable is how local authority funding has been cut by the government beyond the core, with the cuts even more severe in areas of high and increasing deprivation, how councils have sought to mitigate the cuts by playing Monopoly with public money by trying to raise an income from risky business deals and ‘creative accounting’, and for Slough how they they were forced by the government to incur the disruption and extra costs of having to move their children’s services out of their management and control. It has been an expensive failure but fits within the government’s agenda of undermining public services and promoting private profit-focussed companies. Conservative-controlled Surrey County Council, Somerset County Council and others have previously blown the whistle on the damage being caused to local government, communities and services by what is now over a decade of deep cuts and Conservative-controlled Northamptonshire County Council completely imploded. And Mr Jenrick is the secretary of state for communities, housing and local government who is overseeing and should be held to account for the chaos being created. He has a controversial record about election expenses, planning decisions over-ruling local councils and benefitting private developers, and about his personal and central role in an illegal housing deal favouring a Conservative party donor and which would have avoided the private developer paying what was due to the local council. So yes Mr.Jenrick what is happening in Slough and elsewhere is completely unacceptable but may be a look in the mirror will help you to understand why.

    • Chris Sterry July 7, 2021 at 9:21 pm #

      Yes, this Government and the previous Conservative Governments have a lot to answer for, for the 10 years of austerity cuts have put most councils in a dire financial situations and some more than others. Then there is the additional spending due to COVID, is it no wonder that council services are starting to falter.

      But do not blame the councils for that purely rests with the Government, for the cuts meant savings had to be made, where savings were not possible, only by cuts to services when cuts should not have been made, but had to be to result in a balanced budget.

      This is of the Conservatives making and it is they who should be made to account, not the councils.

    • Lilybright July 8, 2021 at 7:56 am #

      Spot on.
      This will continue to happen across local government until/unless funding is restored. At one level it is that simple.
      At another level, unfortunately, it is less simple because the undermining of local government services & local control is driven by the essentially financially & morally corrupt Tory agenda of centralisation & privatisation, which Labour has historically done very little to counter. Voices like Roy Jones’ are important but we all need to protest more loudly & visibly in defence of local & national democracy & public services.

    • Harvey Campbell July 8, 2021 at 10:29 am #

      Previously relatively affluent Conservative controlled local authorities such as Surrey have been very successful in being awarded ‘parachute’ payments by central government to offset the impact of cuts. Whereas, Labour controlled authorities with multiple areas with multiple deprivation have not. It’s gerrymandering by any other name.

  2. Christine July 8, 2021 at 11:30 am #

    Admirable rebuttal of Mr Jenrick but sadly like Croydon Council and others, the infatuation with grand projects by Labour councils is also a massive contributor to the mess residents like me have to live with. Many Labour councils embraced financial practices like creating power companies or property speculation with a zeal that supply side Tories balked at. Labour councils have forgotten that councils are there to provide everyday services for residents. Ask why there are so few local libraries? Tories didn’t ask Labour councillors to create Ideas Partnerships as a pretext to sell prime real estate to property developers at knocked down prices on the empty promise of “affordable” housing. Many Labour councillors and leaders seemed bored with the services our residents wanted when I was a Labour councillor. Meetings were always looking for ‘landmark’ schemes and partnerships instead of doing the tedious bit of keeping roads safe, street lights in good order, the vulnerable looked after. I resigned from my council after one too many “that won’t put us on the map” barbs. I yield to no one in my disgust at Tory assaults on local councils but also have much disdain for how far Labour councils have moved away from their local residents. When New Labour told us they were relaxed about people being filth rich, it unleashed the mindset that has destroyed many a Labour council. Tories just nudged, our side went over with gusto on many occasions. So yes, Tories are seeing what they wanted councils to become but Labour didn’t have to embrace some of this with the enthusiasm they have. I am afraid when Mr Jenrick looks in the mirror he sees a politician content with the world Labour had helped him engineer.

  3. Tony July 8, 2021 at 11:30 pm #

    Would this be the same Slough council that paid its Interim Chief Executive £595,000 when he left?

  4. Daniel July 12, 2021 at 9:46 am #

    When you cut too deep you risk bleeding out. Sadly, It’s the elected government that are holding the knife.

    I feel like we are standing by watching our councils be tortured by this government.