Cllr Simon Radford says the borough needs “national policy intervention” to close its budget gap
Putting Barnet’s finances onto a sustainable footing is our top priority, so we welcome the Ministry for Housing, Communities and Local Government’s (MHCLG) review of the council’s financial position.
The report, conducted by the Chartered Institute of Public Finance and Accountancy (Cipfa), which has been published this week, recognises the scale and pace of change required to solve our £200m structural deficit.
We have current council spend under control and have already reduced our call on exceptional financial support (EFS) by £10m, but demand for services that are a legal duty is growing twice as fast as our income and far outstrips our central government funding. We effectively have a broken system that needs fundamental and fast reform from government, including through initiatives like the Casey Commission on adult social care.
Nevertheless, our plan is to try to reach financial sustainability by March 2029, and we will be bringing that plan to cabinet on 12th October. The task is mammoth – we need to find that £200m of savings or cost avoidance within three years, which requires some very painful decisions in the coming months and years, and a brutally honest conversation with residents.
The Cipfa report identifies issues that we have already been working on, validating our analysis and approach to balancing our books, but with a focus on our position two years ago (2024-25).
We have already made significant progress that is not reflected in this historical picture, with our financial sustainability programme board (FSPB) in place to strengthen direction and support robust decision making by the council’s management team.
Results include getting the cost of adult social care below the national average per adult whilst maintaining top quartile performance, as well as stabilising in-year spend on temporary accommodation.
Cipfa has made two recommendations which will be of particular interest to residents: that Barnet reviews its historically low council tax levels, due to government’s expectation in our funding settlement that we set Band D council tax at £2,060, and that we bring the frequency of bin collections into line with that of most other boroughs.
On council tax, we have already assumed an increase close to the legal maximum of 5%, which would take the Band D level to £1,703. Any further increase would need either permission from the government or a referendum result in favour.
Council tax impacts household budgets, particularly for those on low and middle incomes, so we have always said we would do the hard work to find savings and efficiencies before considering further increases.
We are doing that work but recognise that government has set an assumed level of council tax, known as the ‘notional level’, that they expect us to collect – for us that’s an increase of over 30%, which would need a significant safety net for those who would be impacted the most.
On Cipfa’s waste proposal, we are already planning to push up recycling rates next year by looking at fortnightly waste collections. This is in response to the cross-party recommendation that recycling rates must be increased to 50% in line with the North London Joint Waste Strategy.
We are doing everything we can, including bearing down on the biggest things that drive the need for statutory services in the first place like reduced independence and poor health.
The reality is, though, that none of the levers in our control can tackle the scale of future demand for these services without national policy intervention. Cutting all non-statutory spend would stop the work that helps prevent the need whilst only reducing the council’s budget by £18m compared to the £200m forecast demand.
With our very large and growing older population, we must get a speedier resolution on adult social care funding. As the Barnet ‘Graph of Doom’ predicted 15 years ago, if government does not fix the adult social care crisis it’s not just the NHS that will collapse, it will be local government too.
Cabinet will continue working with the council’s senior management team on delivering our commitment to closing the £200m budget gap by 2029. Most importantly, we will be starting that open and honest conversation with residents in earnest after the summer holidays.
Simon Radford is Barnet Council’s Cabinet Member for Financial Sustainability
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