Peter Landman reports from the Council cabinet on budget cuts to deal with overspending that will extend well into 2024.

By Peter Landman

Inside shot of a gym. — Image ©Danielle
Cerullo/unsplash

Newham Council will slash its looming £14 million budget deficit with a crisis programme of savings that will affect jobs, support for young people and money available to tackle the Borough’s deepening homes crisis.

The Council cabinet has agreed a list of urgent cuts over the coming months to reduce the budget deficit by half and warned of more to come next year as officials scramble to balance the books.

Cuts agreed by the Council involve:

Fewer jobs for agency workers

A ban on overtime working by Council staff

A freeze on recruitment for Council jobs

There will also be less money spent on young people’s services and some resources allocated for social housing will be transferred to address the homelessness and temporary accommodation crisis.

Savings will be made across a range of Council areas including adult social care (£3,433,000); housing and community wealth (£600,000); transfer of social housing for 2023/24 to temporary accommodation (£1,770,000) and youth services (£1,200,00); in total more than half of the deficit will be dealt with in the short term.

Council leaders blame government cuts, economic austerity and neglect over the crisis facing local authorities with high levels of deprivation for the financial crisis.

Cllr Zulfiqar Ali, the cabinet member for finance, told the meeting that areas such as funding for social care of both adults and children are grossly underfunded by government. He said London’s homelessness crisis is the most severe in the country and that London boroughs have an average estimated overspend of £12m in 2023/24, all as a result of the failure of government policy.

Part of the problem facing the Council has been a spike in spending on homelessness. There was a 35% increase in the number of households presenting as homeless from February 2022 to 2023. In July it was revealed the Council had spent £7.4 million more than its budget for temporary accommodation.

Around seven per cent of the Borough’s residents living in temporary accommodation are placed in hotels, which has put “massive pressure” on the Council ’s finances.

As a result the Council is planning to extend its use of places outside the Borough for temporary accommodation, even though, as reported in Newham Voices last month in places like Chatham there is local opposition to Newham’s transfer of its homeless families.

Mayor of Newham, Rokhsana Fiaz, said: “We are continuing to take swift action to tackle the financial challenges facing our Borough, using effective and robust financial management alongside a host of measures that will ensure that vital services continue.”

She said the action by the Council will drive down spending to reduce the budget deficit from £14.2m to £7.3m.

“Years of austerity, cuts in funding, high inflation, higher demand for key services and the lack of reform to local government funding is stretching our budget like never before,” she said.

Despite the latest cuts problems will still remain, so more cuts are expected in the budget for next year.

All change at the gym: new contract for leisure centres

The Council has agreed a combined leisure management health promotion contract with Greenwich Leisure bringing to an end the existing arrangement with Active Newham.

The new deal will recognise the need for more physical activity and the high incidence of obesity, particularly among children.

It includes a range of health promotion initiatives, including free swimming for children under 16, and people over 60; specially designed classes and facilities for older people; lower intensity classes and activities for people new to physical exercise.

There will be discounts for community projects on physical activity, with existing discounts for people on benefits and over 60 and free off peak membership for refugees in Newham.

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