Redbridge financial reserves dwindling

Redbridge Council’s reserves are dropping by £26million as the east London local authority struggles to balance its budget amidst the cost-of-living crisis.

Budget papers for 2024/25, published this week, show that between April last year and March this year the council’s reserves – which are seen as its “safety net” – will fall from £89.9m to £63.5m.

The drop in reserves reflects Redbridge Council’s growing difficulty at managing its day-to-day finances with the funding it has available.

This is partly due to a 54 per cent cut to government funding since 2010 and huge pressures on the services it provides, particularly adult social care, children’s welfare and temporary housing.

Budget papers published yesterday say that the council’s spending on day-to-day services this financial year is likely have have a £17m “impact” on the reserves.

Redbridge’s most senior finance officer, Maria Christofi, has signed off next year’s budget but warned that the council faces “significant risks” to balancing its books.

These include a failure to deliver £23m in cuts and “savings”, increasing costs and further reductions in funding from the government.

Ms Crostofi added that the council will need to make “difficult decisions” to control spending.

To control spending this year, Jas Athwal’s cabinet has already issued a council-wide “moratorium” against any spending that is not needed for safeguarding, health and safety, generating savings or increasing income.

Redbridge is also increasing its fees by 9 per cent or more for services such as street trading, premises licensing, registry services and adult social care.

Details are limited on many of the £23m in “savings” the council is planning.

However, the report suggests these include increasing “highways income” by £3.2m, saving £4m by reviewing care packages for people leaving hospital and saving £3.5m on the council’s pension fund.

The Institute for Fiscal Studies, a think tank, says that the government’s system for funding council’s has “broken down”.

Redbridge Council has not responded to a request for comment.

The council’s overview and scrutiny committee is due to scrutinise the budget at a meeting on February 19 ahead of a vote at full council on February 29.

To read the budget proposals in full, visit this link: https://moderngov.redbridge.gov.uk/ieListDocuments.aspx?CId=823&MId=8723

Josh Mellor

Local Democracy Reporter