The ‘Triple Whammy’- how Havering Council is suffering from 40 years of government underfunding.

Cabinet Lead for Development, Regeneration and Inclusive Growth Councillor Graham Williamson today writes in the Havering Daily.

The media is awash with stories of Council’s on the brink of ‘bankruptcy’ i.e. unable to balance its books. Whilst it is true that the present Government is largely responsible for the Council’s present financial plight Havering has actually suffered under-funding for around 40 years.                                            

Firstly, in the 1980’s the then Government introduced a ‘London formula’ to determine the dispersal of Government financial support between the Capital’s Council’s. Unfortunately, Havering being an outer borough received one of the lowest grants of all. For example, Tower Hamlets would receive over six times/per person than Havering did (then and now our large elderly population attracts little financial support). Thus, this has meant Havering now has higher Council Tax (CT) charges (previously rates) than most other Councils and dipped into our meagre and now dangerously low Reserves of £8m (now the 2nd lowest in London).

Secondly, a Government policy of Austerity from 2010 meant all Councils had their grants progressively cut. In 2010 Havering received a sum of £70m but in 2023 this was only £1.8m (the 3rd lowest in London). This meant that Council Taxes continued to be increased and drastic cuts (over £160m since 2013/14) had to be imposed simply to balance its books. 

Thirdly, there has been a massive increase in young children (presently the fourth highest increase in the Country) as families moving to Havering due to the Government housing benefit cap in 2020 and the borough having the cheapest rental costs. This of course has led to a growing demand for assistance from Children’s Services but without the necessary financial support. This is because the Government froze the demographic numbers to calculate their funding formula way back to 2011 (ironically, another part of Government, the Dept. for Education, accepted that this year’s pupil census shows that Havering’s children’s increased by nearly 60%!)

All in all Havering has suffered over the years a ‘Triple Whammy’.

As a result of the above, we are in a very precarious financial position and the possibility of going ‘bankrupt’ by declaring a Section 114 is a distinct possibility if we cannot source greater funding. We can say however that all of Havering’s budgetary woes can be laid at the feet of Government of all parties

Cabinet Lead for Development, Regeneration and Inclusive Growth

* a couple of diagrams below to highlight the reality

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