London borough to apply to Government for exceptional financial support, blaming temporary accommodation costs
Newham Council is set to become the latest local authority to apply to the Ministry of Housing, Communities and Local Government (MHCLG) for Exceptional Financial Support (EFS), blaming what it calls the “crippling” burden of temporary accommodation costs.
The council’s draft 2025/26 budget plan shows that it aims to make £79m in savings over three years in a bid to tackle a £151m budget gap, which has also been caused by increased costs in social services.
Newham is also set to seek a 10% increase in council tax, subject to government approval, according to the document.
The council is facing a projected budget gap of £51m in 2025/26 and £78m by the 2027/28 financial year.
Mayor of Newham, Rokhsana Fiaz, said: "Newham is on the frontline of this financial SOS, despite investing in our residents and communities on the things that matter to them over the past six years and through the hardest of times."
She later added: "We remain determined to achieve long lasting benefits for our communities and Newham as a place through our building a fairer Newham purpose, and in our draft budget plans we have protected those council services that reflect the priorities expressed by local residents through our engagement with them.
"We have also focused on early intervention and preventative approaches to ultimately reduce the growing cost pressures of the vast array of statutory requirements we have to deal with."
Cllr Zulfiqar Ali, Cabinet Member for Finance and Resources, meanwhile said: “Nearly 70% of our budget, like most councils, is already spent on services for vulnerable children and adults, leaving just the remaining 30% for every other service we provide.
"That’s why we are needing to apply for Exceptional Financial Support which allows us to sell our council assets to fund day-to-day spending.
"This obviously isn’t sustainable and the whole local government sector needs multi-year fairer funding settlements based on local need."
Full council will vote on the proposals in late February.
Adam Carey
