Havering Council has cut its predicted budget gap for this financial year from £19 million to £14m, as it battles an estimated overspend of more than £60m over the next four years. 

In October, leader Cllr Ray Morgon warned of the council’s “toughest budget ever” with potential closures or “significant changes” to council services. 

This was due to a combination of soaring demand on the council to care for the elderly, disabled and children following the pandemic, as well as inflation. 

As the council is legally required to balance its budget each year, it proposed a range of changes, including cutting weekly waste collections. 

In a report published ahead of cabinet on Wednesday (December 14), council officers said the recent reduction is “through a mixture of service actions to contain spend and an increased underspend on treasury management". 

Cllr Chris Wilkins, cabinet member for finance and transformation, said the budget situation is “really awful”, but that a £5m drop in the overspend is “an improvement”. 

According to the report, the overspends include £10m in children’s social care and £4m in adult social care. 

Combined, the overall cost of the two services is two-thirds of the council’s £172m budget for the year. Council tax brought in £136m this year, while business rates brought in £36m. 

Giving an example of cost increases, cabinet member for adults and health Cllr Gillian Ford said the cost of a placement in a residential home has seen a “huge jump” from £695 up to £1,200 per month. 

One care home says its energy costs have tripled in a year, with much of that being “passported” onto the council. 

Cllr Ford felt the government’s system of using council tax to fund social care is not “deliverable or sustainable”, particularly for “older” boroughs like Havering. 

The council’s adult social care service is receiving more than 1,000 calls a week from people asking for more support with elderly or disabled residents they care for. 

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Cllr Morgon said he and chief executive Andrew Blake-Herbert met a government minister this week to make a “strong case” for more funding and also to “offer a solution”. 

About 3,000 Havering residents responded to the council’s consultation on how it should handle the budget overspend, compared to 400 last year. 

Cllr Wilkins said many residents he met have been “very empathetic” about the need to care for adults and children, with one expressing “outrage” at the council’s situation.