The council is also currently engaging with the government on an ongoing basis about support to deal with huge pressures in its housing revenue account. This follows years of central government policies that have restricted the council’s ability to raise income to maintain its housing stock, and also seen extra unfunded responsibilities put on local authorities.
Cllr Claire Holland, Leader of Lambeth Council said: “The Local Government Settlement provides welcome additional funding for services in Lambeth, with growth of £11million in our core spending power.
“This builds on the welcome engagement from the new government with local councils, with the announcement of more powers for local communities and moving towards more sustainable funding after 14 years of cuts forced on councils by central government.
“The settlement has provided funding at a greater level than our earlier forecasts, but the increase in funding does not address the funding gap and growth in the spending pressures we are experiencing in a number of areas.
“One year’s funding settlement was never going to be able to reverse the impact of those 14 years of cuts, especially given the economic inheritance the new Government has received.
“So we need to be open with residents that we still face significant budget gaps caused by 14 years of government funding cuts, unprecedented demand for emergency housing for homeless families and rising demand for adult and children’s social care.”
The council needs to save £69 million over the next four years, and proposals worth £50 million to bridge much of that gap were agreed by the council’s Cabinet on December 9. The council will now consider the full implications of the Local Government Finance Settlement and bring forward final budget proposals to Cabinet and Full Council in February.
In addition to these savings, housing services – which are funded through a separate council housing account – are under major pressure due to years of underfunding, ageing council estates and the cost of extra fire safety work needed following the Grenfell tragedy.
In total over the last 14 years in Lambeth alone Government cuts and unfunded policies have taken £500 million out of the ‘Housing Revenue Account’ budget which is used to maintain the borough’s council homes.
Lambeth Council is the second largest social housing landlord in London with 23,600 socially rented homes, as well as 10,000 leasehold properties. But the borough’s housing is ageing and needs investment, with most homes being flats that are on average more than 60 years old.
As a result, the council is in discussions with the Ministry for Housing, Communities and Local Government to determine what actions will need to be taken to balance the budget over the next few years and how services like repairs, funding improvements such as new windows and doors and cleaning and improving estates can continue to be delivered.
Cllr Danny Adilypour, Lambeth’s Deputy Leader and Cabinet Member for Housing, New Homes and Investment, said: “The situation is stark. Previous governments placed restrictions on how councils could run and fund their housing revenue accounts, and then imposed rent cuts that have cost the council tens of millions of pounds a year. That’s money that we don’t have to improve our repairs service or to invest in ensuring every home is maintained to a high standard.
“It leaves us with a huge shortfall when it comes to meeting our commitment to high standard social housing. We have cut back spending on all but the most essential services, sold buildings where possible, generated new income and borrowed more. But this is still not enough to meet the gap between the money we have and the amount we need to spend on our housing estates.
“This is a situation that many councils in London now face.
“Because of the size of this budget gap, Lambeth is in discussions with the new government about borrowing extra money and raising additional income as well as reducing costs, so we are able to meet our commitments to residents regarding the standard of council housing in the borough. We welcome the new government’s commitment to working with councils to address challenges that have been forced on councils by the previous government.
“We have made good progress in our housing maintenance work, and a national inspection outcome announced in November highlighted Lambeth’s successful improvement journey. But we can only keep this going if we get fresh investment in our housing services and our homes, and that is what we are working to secure.”
