“Despite Our Best Efforts The Council Remains In A Very Challenging Financial Position”-Havering’s Leader of the Council.

Councillor Ray Morgon shares his monthly column in the Havering Daily. Today, he talks about the difficulties Havering faces financially.

As we welcome in the New Year, I want to extend my warmest wishes to every resident across Havering. A new year brings with it a moment to reflect, reset and refocus on the priorities that matter most to our borough.

As we begin 2026, one of our biggest tasks is finalising the Council’s budget. This is never a simple process, but this year – like recent years – it is shaped by severe and persistent financial pressures. Rising demand for vital services, particularly adult and children’s social care, alongside escalating costs linked to homelessness, continue to place extraordinary strain on our finances.

In December, the Government published its provisional funding settlement for local authorities. While we have been lobbying tirelessly for a fairer deal for Havering, and I want to thank everyone who has supported that effort, the outcome is still far from what we need.

The provisional settlement confirms an increase in our core grant of £37.7 million over the next three years, alongside £1.9 million in specific increases for Family First Partnership Funding and support for homelessness and rough sleeping. While any increase is welcome – and reflects the strength of our lobbying – it still falls short of the rising pressures we face. The extra funding will also need to fund the launch of a new mandatory food waste collection service, which is an additional burden for the Council.

The reforms to local government funding have redistributed existing funds across councils, and as a result the deal for Havering is lower than we had expected and lower than what is required for long-term financial security.

Despite our best efforts, the Council remains in a very challenging financial position. The unavoidable reality is that, in order to set a legally required balanced budget, we will again have to apply for a capitalisation direction – effectively a loan – of around £90 million per year for the medium-term period. This is not a position any council wishes to be in, but it is the only mechanism currently available to protect essential frontline services.

We will continue to lobby the Government not only for a fairer funding deal for Havering but also for measures that would ease the long-term burden on our finances – including asking for the interest on these loans to be waived. We will not stop making the case for the funding our borough deserves.

Despite the financial challenges, our commitment to delivering for residents remains as strong as ever. This year, we will continue to make progress on the things that matter most:

• Cleaner and greener streets, volunteering and community pride through our Where We Live campaign.

• Support for local businesses with our Keep It Local initiative, helping strengthen our high streets and local economy.

• Investment in community safety, including funding S92 police officers and expanding our network of modern digital CCTV cameras.

• More homes for local families, with continued investment in high-quality, affordable housing.

These are the priorities that make a real and tangible difference to people’s daily lives. And even in challenging times, we remain focused on building a borough that is clean, safe, supportive and full of opportunity.

Thank you for everything you contribute to Havering – whether through volunteering, supporting neighbours, running local businesses, or simply being an active and caring part of our community. Your support helps us to make Havering a place we all want to be part of.

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