A funding gap of £82m by 2031 has been forecast ahead of the next budget being agreed later this month, reports Nick Clark, Local Democracy Reporter
Barking and Dagenham Council faces a funding gap of more than £82million by 2031, newly-published budget plans have warned.
The warning comes despite an expected increase in government funding announced in December.
The council says it faces “rising demand for services because of growing poverty” while at the same time having to find “significant savings as part of a squeeze on public finances”.
Budget papers add that the council has suffered “a substantial reduction in funding” over the past 15 years.
Council leaders are set to endorse a draft budget for the 2026/27 financial year at a meeting this Monday (16th).
The draft budget is balanced – meaning spending matches the amount of funding the council will have – but includes “savings” of almost £9m.
Budget plans say the council is set to benefit from changes to the way the government allocates funding to local authorities.
The government’s Fair Funding Review published in December indicated that the council’s ‘core spending power’ would increase by 11.5% in April.
Speaking last month, Labour council leader Dominic Twomey said the increase would mean council staff will “hopefully have less worry about what cuts they need to make next year”.
He said the extra funding would allow them “breathing space” while the council implemented changes aimed at efficiency and bringing down costs.
However, budget plans say that the funding boost “does not compensate for the substantial reduction in funding the council has faced over the past 15 years”.
The draft budget says that the town hall’s core spending power is still estimated to be up to 40% lower in real terms than it would have been if austerity measures after 2010 hadn’t cut council funding.
It says this has left “Barking and Dagenham tens of millions of pounds short of the level it might otherwise have received”.
At the same time the budget papers say that – like all local authorities – the council faces increased demand for services such as housing and social care, coupled with rising costs.
Budget papers say: “As is the case across the country, social care funding, particularly adult social care funding and its escalating costs, is a significant challenge for all local authorities, and we continue to see rises in requests for support and assessments.”
They add: “Councils like Barking and Dagenham with high levels of deprivation have faced rising demands for services because of growing poverty.
“At the same time as this they have had to find significant savings as part of a squeeze on public finances.”
Budget papers predict that, based on current trends, the amount the council will need to spend between April 2027 and March 2031 will be £82.4m more than it will have funding for.
They say that the council will need to implement a “robust, strategic, and transformative programme of change” to avoid this.
The papers say: “Incremental or ‘salami slicing’ savings will no longer be sufficient to close the gap.”
The final budget is set to be debated and voted on at a meeting of all councillors on Wednesday, 25th February.
