Council improvement

Managing the money

It is a legal requirement for all councils to balance their budgets. 

Slough Borough Council was unable to balance its budget in 2021. Strict financial measures were introduced to manage the council’s finances.

The council continues to operate with restrictions on spending as part of the work to resolve the current challenging financial situation.

No new spending is allowed, with a few exceptions including protecting vulnerable people, minimum level statutory services, and pre-existing commitments.

Background and next steps    

• In June 2021, the council asked Government for financial help with serious debt that had reached an unmanageable level.
• In response to the council’s financial crisis, the Government sent commissioners into the council in December 2021 to oversee day-to-day operations and support recovery.
• The early findings into the financial situation were laid out in an external assurance review for the government led by the Chartered Institute of Public Finance and Accountancy (CIPFA). The review attributed the excessive debt to poor decisions, poor value for money, inadequate processes, and financial mismanagement over many years.
• The council’s past debt is considered excessive because sums were borrowed without sufficient plans in place for how the money would be repaid, which led to a financial crisis when the repayments could not be met.
• Understanding the full extent of the accumulated historical debt is complex and the details are still being assessed now.
• The current political council administration came into office following the local elections in 2023. Council Members and officers are working with Commissioners and the Government to regain longer-term financial sustainability and reduce the debt over time.
• The Council has sold more than £200m of assets to reduce debt and cut costs. The sales are ongoing. It has been assessed that the remaining property sales will help reduce the council’s debt but will not raise enough to resolve the debt.
• By law, all councils must set a balanced budget each year.
• The excessive past debt has a substantial impact on the Council’s ability to fund services and set a balanced budget as interest and repayments pre-empt up to a fifth of the available resources each year.
• Council income comes from Government grants, Council Tax, and fees and charges.
• Councils across the country are facing financial pressures from a combination of rising costs and increasing demand, while receiving reduced grants from central Government over many years.
• Nationally, the rising costs of temporary accommodation, adult social care and children’s services are major council budget stress factors. For example, locally in Slough Adult Social Care services have seen an 8% increase in total clients accessing long term support throughout the year between 2019 to 2020 and 2023 to 2024, which compares to a 2% increase across England, and 4% across the Southeast, in the same period. Also, Slough has experienced a rise in homelessness, and placements in temporary accommodation have increased as a result. A recent review of the numbers showed a significant rise in approaches for Temporary Accommodation in 2024, with numbers more than 25% up on our annual target from early in the year. By the end of the year, the numbers in Temporary Accommodation had increased to 1400 households.
• In this financial climate, councils are making difficult decisions on how to use limited and reducing resources.
• In November 2024, the government announced intervention at Slough will continue until November 2026.