Havering Saved For Now-As It Must Look For Alternative Funding.

Last week it was announced the Havering Council would receive an £88million bailout loan the borough desperately needs to keep afloat. After endless years of funding cuts by successive governments, Councillor Graham Williamson, Cabinet Member for Regeneration today writes:

The monies required to deliver services that the Council by law has to deliver, has been steadily cut by the Government, meaning that for the last two years, Havering has been put in the perverse position of borrowing from them simply to survive.  The total line of credit the Government has agreed we can draw upon is £70.2m, rising by a further £17.8m to £88m if required. This line of credit from the Government is predicated on several conditions. These include continuing to make any efficiencies this year and delivering on the saving plans we had agreed in previous budgets, such as closing libraries. The opposition were aware of these facts but continued to be reckless and tried to undermine the Administration for political posturing, thus putting the Council and, more importantly, our residents at risk.  Not keeping to the Government conditions would result in them withdrawing the line of credit, thus forcing the Council to declare a Section 114 i.e. ‘bankruptcy’.  Until our funding is settled, we will have to go cap in hand to those responsible for the problem in the first place!

BANKRUPTCY?

Sadly, not all the Opposition members understand the necessity to borrow and would prefer to give up and declare a Section 114. They have been making public statements ignoring the severe consequences which residents will face if this happens.  What they fail to understand is that this would result in the Government appointing Commissioners at a cost of £500k – 1million a year, met by Havering residents’ council taxes. As mentioned above they would also increase Council Taxes between 9 and 15% a year, sell assets without scrutiny and at reduced prices, as well as further reductions in services. However, we would still have to take a loan to make up the difference! Indeed, both this and the last Government asked whether we wanted to put Council Tax above the 4.99% cap. Since the problem is not our residents’ fault the Administration said NO. If the Opposition parties had their way and rejected a loan it would result in even higher council taxes.  

 THE FUTURE – HOLDING OUR NERVE

If not taking out a loan is foolish what next for Havering? Although we have consistently lobbied all Governments, Conservatives and Labour alike, to fund us fairly, they have not up to now, but the latest one is reviewing Local Government funding and how social services should be funded nationally. In the meantime, we need to hold our nerve until funding is resolved and make greater use of developer 106 Agreements, tighter control of social value from contractors and attract inward investment to the borough to improve the services that most residents want e.g. clean and tidier streets and Green spaces. 

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