‘The deteriorating financial position, which is not being gripped and tackled adequately by the council, is reaching a “financial crisis”.’
Here is the full written statement to the House of Commons today from Jim McMahon, the local government minister
I have previously updated this House that this government is committed to resetting the relationship between central and regional government, and to establishing partnerships built on mutual respect, genuine collaboration and meaningful engagement. Local councils must be fit, legal and decent and this government is taking the action necessary to fix the foundations of local government.
Today, I am updating the House on the steps we are taking to support the London Borough of Croydon to recover and reform.
London Borough of Croydon
I am today publishing the latest report of the London Borough of Croydon Improvement and Assurance Panel, which I received in April. The report acknowledges and welcomes the hard work of the council’s members and staff and notes that there has been some progress over the course of the intervention, which is due to end on 20 July this year.
However, the Council’s financial position is deteriorating rapidly and the report documents serious concerns particularly on the council’s ability to improve, on some aspects of leadership and on use of resources.
Croydon remains one of the most financially distressed councils in the country. The council’s General Fund debt sits at around £1.4billion and it relies on the allocation of Exceptional Financial Support (EFS) through in-principle capitalisation directions to balance its budget. The dramatic increase in the council’s £136million EFS for 2025-2026 from £38million granted for 2024-25 is highly concerning.
The council has received approximately £553m in total EFS since March 2021. This is simply not sustainable. Continue reading →
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