The meeting approved the Revenue and Capital Budget 2025/26, the External Auditor Recommendations and the Pay Policy Statement 2025/26. Both the Green and Liberal Democrat groups presented alternative budgets that were not carried.

Library Budget Cuts

The meeting began with a deputation from Laura Swaffield and Maureen Freeman about a proposed £1 million cut to the library service's budget. Swaffield and Freeman argued that the cut would damage the service, putting pressure on other Council services and creating extra costs, and contrasted Lambeth's proposed library budget with that of the neighbouring borough of Southwark.

We can argue about whether a million quid is a or more or less of your 4 million plus budget, but that 4 and 4 million plus budget has barely budgeted in 40 years. So 40 years of inflation has reduced it to a third of what it was. And I would like to point out that Southwark funds its libraries to the tune of 8 million, double.

Councillor Donatus Anyanwu, Cabinet Member for Stronger Communities, responded that Lambeth was proud to continue its investment in libraries, and that no libraries would be closed and no staff would be affected by the cuts. He added that Lambeth's libraries were a place for people to study and that they delivered services such as the Home Library service and the Prison Library Service. He also pointed out that 99 council-run libraries in London had reduced their opening hours since 2016 due to 14 years of austerity imposed by Conservative and Liberal Democrat governments.

In the last seven years, a further 900 libraries have had their hours reduced in the past seven years as I mentioned. And in this recent decision here in Lambert the council is forced. To deliver more with less. Despite this, we have not only protected investment in our libraries. We have enhanced it because we know. Often the heart of our communities are in our libraries.

Anyanwu said that Lambeth spends £4 million on libraries each year and that it has also invested £4.7 million in capital funding to improve libraries. He said that this funding has been used to refurbish and modernise libraries, creating new spaces and venues, including a cafe at Brixton Library.

This include 1.7 million to refublish and modernize our libraries, creating venues, spaces, launching a cafe and providing enhanced customer support. Some of those, as you mentioned, is investment we have done in Brixton library, which we have done in Brixton library for 1 million.

Swaffield and Freeman had argued that a proposed increase of £100,000 to the book fund was inadequate. Anyanwu countered that this was a significant investment in the book fund.

This efficient services, as you mentioned, is, in relation to our book fund, underspend for many years. I've looked at the record since 1998 is only one year to spend over 347.

Swaffield and Freeman also pointed out that libraries provided a massive programme of events and activities, and questioned if this would be possible following the proposed budget cuts. Anyanwu said that it would be, as library staff have not been affected.

Proposed Council Budget Cuts

The meeting then heard a deputation from Ruth Cashman and Jocelyn, a representative of Lambeth UNISON about proposed budget cuts across a range of services.

Cashman and Jocelyn argued that after 15 years of cuts, there was nothing left to cut. Cashman and Jocelyn contrasted Lambeth Council's previous insistence that austerity was a political choice made by the Conservative government, with their current acceptance of the newly elected Labour government's decision to continue austerity.

For 15 years, unions of residents have fought against the cuts without you. And for 15 years, the message from Lambeth Labour has been the same... You told us austerity was a political choice by the Tories. The Labour Party won the election, telling us that it was the end of austerity. Now the Labour government is making a political choice, a political choice to continue with austerity.

Cashman and Jocelyn argued that the Council should use its reserves to protect services, rather than cutting services including children's centres and the library service. They added that the council should be increasing spending in the borough, not making further cuts.

Jocelyn drew attention to the Contextual Safeguarding Team within Children's Social Care, which they said had been eliminated from the proposed budget. Jocelyn described the work of the team, which included supporting young people at risk of violence, coordinating community programmes and helping to make community spaces safer.

Unison have been raising the posted in children's services contextual safeguarding team. This team could coordinates community programs and assist dangerous locations in the community... The team provides the overall intelligence lead approach to social work. This team has been eliminated within the proposals.

Councillor Ben Kind, Cabinet Member for Children's and Families responded that the council was realigning its approach to safeguarding.

Keeping children safe is an absolute priority and that is why after a two year pilot. We're embedding contextual safeguarding to frontline social care to reach at risk young people earlier and provide direct services. And provide direct support rather than just funding an advisory function which sits separately.

Kind said that the new model of contextual safeguarding followed evidence on tackling child exploitation. He said that the new model would place specialist workers in frontline teams to provide direct support, and that youth coordinators would work alongside an 18 Plus Youth Coordinator Lead and a Strategic Coordinator to strengthen partnerships with schools, youth workers and families. He said that the council would be embedding this approach into its frontline services.

Cashman and Jocelyn had argued that the cuts to services would have a disproportionate effect on Black workers and the multicultural communities in the borough. Kind argued that the budget was designed to protect the most vulnerable young people, and that rejecting the budget would mean losing extra funding for services such as the School Admissions and Transport Team and social care. He argued that the opposition groups were not serious about protecting services as they had not provided meaningful alternative proposals. Kind said that austerity had caused the council's financial problems, but that after 14 years of Conservative cuts, Labour had increased council funding by 7%. He said that this meant Lambeth would get £20 million in extra funding.

After 14 years of Tory and Lib Dem cuts, things are beginning to change. Labour increased council funding by 7% this year and Lambeth got £20 million extra, whilst last year we got a £1.3 million cut under the Tories. Is it enough? No, but change takes time, especially after 14 years of Tory and Lib Dem austerity that they did, Brexit, Liz Truss's economic crash and it doesn't just happen in nine months following an election.

Kind said that there was £74 million in additional spending in the budget, partly funded by savings. He said that this included £46 million for temporary accommodation and social care, and £19 million for inflation, including £6 million for worker's pay.

Kind said that Lambeth Labour defended trade union facility time, that it had brought leisure services back in-house and that it paid the London Living Wage. He concluded that Labour's approach was responsible, whereas the opposition groups' approach was reckless.

Revenue and Capital Budget 2025-26

The meeting then debated the Revenue and Capital Budget 2025-26.

Councillor Danial Adilypour opened the debate on behalf of Councillor David Amos and said that Lambeth was facing a challenging financial future as a result of austerity from Conservative-led and Liberal Democrat-enabled governments. He said that Lambeth welcomed the £2 billion of increased funding to local government from the Labour government, but that more was needed, as Lambeth's core spending power would be £136 million higher if it had increased in line with inflation since 2010. Adilypour added that the increased investment showed that Labour was serious about tackling the damage caused by austerity but that it would take years to repair the damage done.

Adilypour said that the Liberal Democrat and Green budget proposals would offer no solutions to the problems of temporary accommodation or social care and that Lambeth would be investing £45.9 million in additional funds to protect these services. He said that Lambeth would raise council tax by 2.99% and the adult social care precept¹ by 2% to keep funding essential services. He added that support would continue for Lambeth's council tax support scheme², which he described as one of the most generous in London. Adilypour said that Lambeth would be introducing a council tax premium on second homes from next year and that since its introduction, Lambeth has charged over £21 million against absentee landlords.

He concluded by arguing that the Labour budget was a reflection of Labour values, that it put the Council on the side of local people and that it delivered the services that vulnerable residents rely on.

Councillor Donna Harris, Leader of the Opposition, then spoke. She argued that Lambeth Labour had overspent for the last two years and had been forced to resort to a government loan. She said that the Council's auditors had issued rare statutory recommendations to prevent further crises and that the corporate peer challenge team had recommended that the council should bring Homes for Lambeth, its wholly owned housing development company, in-house to allow it to assess the full cost of the company. Harris argued that Labour was taking an insufficiently urgent approach to this issue.

Harris said that the Liberal Democrat's amended budget could not fully fix the damage that Labour had done to the borough's finances, but that it offered steps to reprioritise cuts and spending plans, focusing on five key priorities:

Reversing harmful cuts. Harris said that the Lib Dems would restore Labour's proposed cuts to street lighting and healthy eating programmes.
Housing. Harris said that the Lib Dems would introduce an urgent repairs housing officer to improve the service on urgent housing repairs.
Pensioners. Harris said that the Lib Dems would help pensioners by offsetting the Labour government's decision to remove millions from the Winter Fuel Payment scheme.
Devolving power. Harris said that the Lib Dems would devolve power to local communities by allocating modest budgets to Councillors to spend on community projects in their wards.
Incentive-based emissions reductions. Harris said that the Lib Dems would reward residents for driving less as part of their emissions reduction strategy.

Harris added that in the past, Labour had ridiculed the Lib Dems' budget proposals, but then quietly adopted them. She concluded by saying that the Liberal Democrats would continue to offer constructive and fair alternatives to Labour's budget proposals.

Councillor Nicole Griffiths then presented the Green Group's alternative budget, arguing that Lambeth Labour's proposed budget was a budget of cuts. She criticised the Labour administration's failure to take responsibility for the Council's financial situation and drew attention to the external auditors' report, which she said was littered with red flags. Griffiths argued that Labour had been responsible for the high cost of Homes for Lambeth, for selling off council homes and for neglecting the Council's existing housing stock. She also argued that Labour had mismanaged the Council's budget, failing to control costs and exhibiting weak governance. She said that this had resulted in legal costs rising and in compensation having to be paid to residents due to the Council's neglect of social housing and its failure to carry out repairs. She said that Lambeth's proposed increase in council tax by 4.99% would result in residents being asked to pay more for fewer services.

Griffiths highlighted the Green Group's budget amendment, which she said focused on investing in people and maintaining public services and infrastructure. She said that the Green Party wanted to see Lambeth's most vulnerable residents protected, and she criticised the Labour administration for proposing cuts to the Library service, to services for young people and old people and to children's services, which she said would leave more young people vulnerable.

She highlighted a number of proposals in the Green Group's budget amendment, including:

Providing full council tax support to all those who qualify for it.
Funding a replacement winter fuel payment scheme.
Providing extra help for people to claim benefits.
Developing a pilot furnished tenancy scheme.
Reducing leisure fees for young people, and
Funding the Contextual Safeguarding Service.

Griffiths concluded that the Labour government had halted progress towards a fairer society and urged the meeting to vote for the Green Party's amendments.

The meeting then heard a number of speeches from Labour Councillors in support of the Labour budget, which covered topics including the Council's investment in libraries, leisure services, its commitment to being a borough of sanctuary, the Council's success in reducing its spending on agency staff and the Council's cost of living programme. Councillors also highlighted the Council's record on delivering housing, its success in supporting Ukrainian refugees, its work with the Portuguese-speaking community in the borough and its efforts to tackle violence against women and girls. Councillors highlighted the Council's successes in promoting apprenticeships and supporting business development in the borough.

In his closing speech, Councillor Scott Ainslie criticised the Labour administration for what he described as an appalling lack of corporate grip on budget setting, claiming that the Council's proposals were vague and that they were not a serious response to the Council's financial situation.

Ainslie drew attention to the auditor's statutory recommendations to the Council, which he said had been issued as a result of the Labour administration's failure to manage the Council's finances. He said that this was a first stage warning from the auditors, and that unless the council addressed the problems with the management of its finances, government inspectors would have to be sent in. He pointed out that only two other London boroughs had received statutory recommendations: Croydon, which he said was bankrupt as a result of a disastrous attempt to become property developers, and Tower Hamlets, which he said had to have government inspectors sent in to address serious problems with their finances. Ainslie argued that Lambeth Labour's response to the auditor's report had been complacent and inadequate, and that Labour was failing to address its failings.

How can we ignore the mistakes you've made that have brought us here? The gap in the budget is almost exactly equal to the debt owed by Homes for Lambeth at the end of last year. Not to mention ongoing neglect of council housing, millions in compensation payouts, wasteful contracts and countless other governance issues. This budget is your mess.

Ainslie said that the Green Group's budget amendments highlighted the damage that Lambeth Labour's proposed budget would do, and that the Council was proposing to cut essential services. He said that there was no reassurance that the council had identified all possible savings or that it was proposing to take the necessary steps to improve value for money, before proposing to raise Council Tax and cut services for young people, transport, and libraries.

Are you going to review executives pay? Are you going to look at the leaders office budget? You either don't know or you won't tell us what your plans are. Every year we are told that a few million won't make a difference, but tell that to the people whose council tax and heating bills are going up or families of same children who can no longer rely on the short breaks program.

He argued that Labour had broken its manifesto commitment to maintain one of the most generous Council Tax Support schemes in London, and he said that other councils, such as Hackney and Islington, had more generous schemes. Ainslie concluded that Labour's budget was a budget of austerity.

Councillor Matthew Bryant then spoke on behalf of the Liberal Democrats and argued that Lambeth Labour had mismanaged the Council's finances. He said that the Lib Dems had focused on five priorities in their alternative budget: street lighting, the Healthy Living Platform, housing, pensions and decarbonisation. Bryant argued that before making further cuts to frontline services, the Council should reduce spending on senior management salaries, in particular the number of highly paid posts. He also said that the Lib Dems' budget would see an end to the doubling of high paid salaries in the Council, and that it would generate more income from letting out vacant office space.

Bryant pointed out that the Lib Dems' budget included a local scheme to compensate residents for the Labour government's decision to remove millions of pensioners from the Winter Fuel Payment scheme. He said that the Lib Dems' proposals were aimed at improving the Council's performance on repairs, and that their proposals would see dedicated housing officers with responsibility for urgent repairs allocated to each ward. He argued that this would improve responsiveness in housing services and that it would address the problems of repairs requiring multiple visits from housing maintenance staff.

He criticised Lambeth Labour for failing to expand the Community Toilet Scheme, pointing out that there were half as many public toilets as there were nine years ago, and he said that the Lib Dems' proposals would see a low mileage discount for parking permits introduced, which he said would help residents who were struggling to afford parking permits and would also encourage people to drive less.

Councillor Clare Holland closed the debate on behalf of Labour and said that the Green and Liberal Democrat proposals were not alternative budgets, but tweaks to the Labour budget. She argued that both opposition groups were silent on the challenges of social care and the housing crisis, and that they were in denial about the impact of 14 years of Conservative and Lib Dem austerity.

14 years of economic vandalism. Vandalism that stripped away our public services and asked us to deliver more with less. Vandalism that failed to tackle the dramatic increase in demand and cost of providing services. Vandalism that has forced councils across the country into our worst financial crisis yet.

Holland said that Labour was working with the government to address the issues facing the borough, and that they were investing in affordable housing, good quality local jobs, library services, parks and leisure services. She said that they were also tackling violence against women and girls and leading the way in tackling the climate crisis. Holland concluded that Labour was the only party that was taking governing seriously and that Labour would protect vulnerable residents.

All three budget amendments were defeated, with the Green Group's amendment receiving 5 votes, the Lib Dem's amendment receiving 5 votes and the Labour budget receiving 49 votes.

External Auditor Recommendations

The meeting then moved on to consider the External Auditor Recommendations.

Ainslie opened the debate for the Green Group and argued that the statutory recommendations that the auditors had made to Lambeth were unprecedented. He said that the external auditors had issued the recommendations because they had been raising the same concerns about the Council for three years, but that the council had ignored them. He argued that the recommendations were effectively a warning to the Council that unless they get a grip on how they were managing the Council's finances, they risked government inspectors being sent in to oversee their work.

There is inadequate governance in place, insufficient management of the council's finances and serious feelings on value for money. We and others have been saying this for years. The fact that Lambeth's paid auditors are saying it out loud should be ringing alarm bells, as this is effectively a first stage warning that unless you fundamentally get a grip on governance yesterday, your risk government inspectors coming in.

Ainslie criticised the Labour administration's response to the auditor's report, arguing that they were deflecting criticism and blaming everyone but themselves for the Council's financial situation. He said that only two other London boroughs had received statutory recommendations.

Ainslie highlighted two examples in the auditor's report that he said demonstrated Labour's failure to manage the council's budget:

The savings the council identified that would be needed in December 2023 had increased by £10 million by February 2024.
The savings the council identified that would be needed in December 2024 had increased from £49.9 million to £101.9 million three months later.

In December 23, Cabinet identified that 19.3 million of savings were acquired. Three months later, by February, this figure had increased to 29 million. You then repeated the error. In December 24, Cabinet identified 49.9 million of savings were needed. Just three months later, the savings needed had bloomed to 101.9 million.

He argued that the council was repeating these errors with a one line item in the budget of £30 million for a Target Operating Model and that no one could explain how this saving would be achieved.

Ainslie also highlighted the auditor's concerns about Homes for Lambeth, questioning how much the company's mistakes would cost the people of Lambeth. He concluded by saying that the Green Group would be voting against the Council's response to the auditor's report, but that they agreed with the recommendations made by the auditors.

Councillor Matthew Bryant then spoke on behalf of the Lib Dems and argued that the auditor's report was effectively a warning to the Council that unless they got a grip on their finances, they risked being declared bankrupt. He argued that the Labour administration's response to the auditor's report had been complacent and inadequate, and that Labour was deflecting criticism rather than addressing its failings.

Bryant highlighted the auditor's recommendation that the Council should urgently bring Homes for Lambeth back in-house, contrasting Labour's previous commitment to complete this task with their current position, which he said was to delay until after the next local election.

But it's the final recommendation in their letter that there can be no running away from. This is the recommendation that calls on the council to get a move on in transferring Holmes for Lambeth back in house... Yet as we saw at Cabinet last week, the council's response to the peer review was to assign this task as some long term timescale defined as summer 2026 or later.

He argued that until the Council had completed this task, they would not know the true cost of Homes for Lambeth. He pointed out that the council had already written off £23 million of loans to the company, but that the final bill would be much higher, and that until this process was completed, the council could not have an accurate view of its finances.

Councillor Rezina Chowdhury, Deputy Leader of the Council, then responded to the debate on behalf of Labour, arguing that the Council's financial problems were the result of 14 years of structural underfunding from central government. She said that in line with other London boroughs, Lambeth Council's finances were under pressure as a result of increasing demand for services and a rise in the costs of delivering them. Chowdhury said that Labour had responded to this pressure by significantly reducing the council's reliance on agency staff and that enhanced spending controls would continue to mitigate service pressures during 2025/26. She said that the Council's reserves strategy would be reviewed to determine how to replenish the level of unallocated reserves. Chowdhury also said that the Council would continue to work to bring Homes for Lambeth back in-house and that this work would identify the risks and implications for the Council's finances.

As we have heard from contributions this evening, and as our budgets set out, and as the calls from sector bodies such as the LGA and London councils make clear, this is the worst funding crisis that local government has ever faced on the back of 14 years of structural underfunding from successive governments commenced commenced by the Tory Lib Dem coalition of 2010. Councils of all stripes are in crisis.

She concluded that the council had been warning central government for a long time that the funding system was broken and that further urgent action was needed to support councils and to secure the future of council housing in England. The recommendations in the report were approved.

Pay Policy Statement 2025/26

The meeting then moved on to consider the Pay Policy Statement 2025/26.

Ainslie argued that the statement was inaccurate, as it did not acknowledge that the new Chief Executive's salary would be £230,000, not £196,000 as stated in the report. He said that this was £34,000 more than budgeted and £44,000 more than the previous Chief Executive. He argued that this meant that the pay multiple between the highest and lowest paid staff was now 9.6 to 1, not 8.18 as stated in the report.

Ainslie criticised the Council for exceeding its budget for the Chief Executive's salary by £30,000, arguing that if the Council was committed to narrowing the pay gap, it would not have done so.

If the Council was truly committed to this equality metric, why did they pay their successful candidate $30,000 more than budgeted in the job description?

He pointed out that the number of employees paid more than £100,000 had increased by 24% in the last year, to 51, and that the number of employees paid more than £125,000 had doubled. Ainslie said that this represented £3 million being paid to a small number of highly paid staff, at a time when the Council was facing budgetary pressures.

The number of employees paid over $100,000 has increased by 24% in the last year to 51% from 41% last year and 24% in 2020. After including real wage value for the Chief Executive, this represents nearly $3 million out of residents' pockets.

Ainslie criticised the Council for failing to provide evidence that its highly paid executives were delivering value for money.

I don't know about any other members, but I'm constantly asked where the evidence is to prove that our highly paid execs are talented. How do we prove that to people? And why do these talented people seem to be leaving?

He said that during his time as a Councillor, he had seen six Chief Executives leave, alongside a number of other senior staff from Legal, HR and Finance, and he questioned why they were leaving if their salaries were so high.

He also drew attention to the fact that in 2024, Lambeth topped the Housing Ombudsman's League Table for the highest number of complaints, with an 85.5% maladministration rate.

In 2024, Lambeth topped the Housing Ombudsman's League Table for highest number of complaints, with an 85.5 mal-administration rate. Obviously, executive salaries do not equate to quality services in this Council.

Ainslie said that the Greens supported paying people fairly, particularly those on the frontline, but that their concern was that the Council was paying excessively high salaries to executives without a corresponding return for residents. He called on the Council to quantify the value for money residents could expect from the increases in salaries. He added that the Council was failing to be transparent, as for the second year running, a salary range had been reported in the statement rather than an exact salary figure, and that in the interest of transparency, the Council should go further than guidelines required and report exact salary figures, including for IR35 contracts³.

Councillor Donna Harris then argued that the Lib Dems were concerned about the rapid rate of increase in senior staff salaries and contrasted the rise in salaries with the Council's overspend in the last two years and the cuts to services the council was proposing. She pointed out that in the last three years, the Council had doubled the number of employees earning more than £50,000, that there were 1,200 Lambeth officers earning £50,000 or more per year, that there were 280 officers earning £70,000 or more, 51 earning at least £100,000, and 7 earning more than £160,000.

Harris said that 11 new appointments were made last year to posts attracting more than £100,000 per year, contrasting the high salaries being paid to these new appointees with the fact that the lowest paid employees earn £23,000. She said that the Chief Executive would soon be paid ten times the salary of the lowest paid employee and that the ratio of 1.8 given in the pay policy statement did not reflect this reality.

She added that the Lib Dems believed that cuts could be made to the management structure without impacting frontline services and that the statement did not explain why there had been two severance payments exceeding £100,000 last year.

The pay policy statement also refers to two severance payments exceeding over £100,000 last year. Issues like this matter not only in terms of money, but in terms of perception.

Councillor Nanda Manley-Brown responded on behalf of Labour, arguing that the statement reflected progress made in ensuring fairness in pay and workforce conditions.

Colleagues, in a time of financial uncertainty and increasing demand for services, fair pay and strong workforce policies are more important than ever... Their dedication and expertise are the backbone of our services, and we thank them for all that they do.

She pointed out that the lowest paid staff now earn nearly 50% more than they did in 2014, compared with the highest paid earners who earn only 1.7% more and that the pay multiple between the highest and lowest paid staff has decreased from 12.1 to just over 8.1.

Manley-Brown said that the increase in the number of employees earning more than £50,000 was the result of nationally negotiated pay settlements, not unchecked increases locally, and that if the threshold had risen with inflation, it would now be £72,000. She added that the council's workforce now more closely reflects the demographics of the borough than ever before, with more Black and Asian staff in senior management roles. She concluded that Lambeth Labour was committed to decent pay, fair conditions and workforce diversity.

The recommendations in the report were approved.

This is the adult social care precept. It is an additional charge levied on Council Tax in England since 2016. It is intended to fund adult social care services. Councils are able to set the level of the precept within limits set by the government, currently up to a maximum of 2%. ↩
The council tax support scheme is intended to help people on low incomes with their Council Tax bills. ↩
IR35 is a piece of UK tax legislation introduced in 2000 to counter tax avoidance by workers supplying their services to clients via an intermediary, for example a Personal Service Company. The legislation places an obligation on the client to determine if the worker would be classed as an employee if the intermediary did not exist. If they would be classed as an employee, then the client will be required to deduct income tax and National Insurance contributions before paying them. ↩

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Budget Council, Council - Wednesday 5 March 2025 7.00 pm

Summary

Library Budget Cuts

Proposed Council Budget Cuts

Revenue and Capital Budget 2025-26

External Auditor Recommendations

Pay Policy Statement 2025/26

Attendees

Documents

Subscribe to updates

Budget Council, Council - Wednesday 5 March 2025 7.00 pm

Transcript

Summary

Library Budget Cuts

Proposed Council Budget Cuts

Revenue and Capital Budget 2025-26

External Auditor Recommendations

Pay Policy Statement 2025/26

Attendees

Documents