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Croydon Faces £34m Overspend; Stabilisation Plan in Motion
This week in Croydon:
Council Grapples with £34.2m Overspend
Croydon Council is facing significant financial challenges, with a projected overspend of £34.2 million as of January 2025. This was revealed in the 2024-25 Period 10 Financial Performance Report, discussed at the Scrutiny & Overview Committee meeting on Tuesday. The overspend is primarily driven by demand-led services, particularly in housing, and the council's historic borrowing and debt burden.
- The Stakes: Without intervention, this overspend could lead to further cuts in essential services and increased financial strain on residents.
- Mitigation Efforts: The council plans to reduce the overspend to £4.3 million through a combination of risk contingency budgets, corporate earmarked reserves, and capitalisation directions1.
- Housing Crisis: The Housing Revenue Account (HRA) is also forecast to overspend by £8.0 million, with temporary accommodation costs soaring due to an average increase of 50 paid units per month and rising nightly rates.
The council's financial woes are not new. As previously reported, Croydon Council effectively declared bankruptcy in 2020 and has been under scrutiny ever since.
Stabilisation Plan Aims for £27.3 Million in Savings
In response to its financial difficulties, Croydon Council is implementing a Stabilisation Plan, a key topic at the Scrutiny Homes Sub-Committee meeting on Thursday. The plan aims to save £27.3 million in 2025/26 through various measures:
- Housing Focus: Key actions include reducing temporary accommodation placements, allocating general needs housing to temporary accommodation, and accelerating the house buying process for homeless families.
- Impact on Vulnerable Groups: These measures could disproportionately affect vulnerable residents relying on council housing and support services.
- Parking Income Boost: The plan also includes increasing parking income by £1 million through increased penalty charge notice (PCN) income and improved debt recovery, a move that could impact drivers across the borough.
The Cabinet is scheduled to discuss the plan on 25 June 2025.
Housing Service Performance Under Scrutiny
The Scrutiny Homes Sub-Committee also reviewed the performance of the Council's Housing Service, focusing on key performance indicators (KPIs) and financial performance.
- Tenant Satisfaction: The council is required to submit Tenant Satisfaction Measures (TSM) annually to the Regulator of Social Housing (RSH).
- Repairs and Maintenance: The committee examined average call waiting times for the repairs contact centre and satisfaction levels with how the contact centre deals with repairs and maintenance.
- Re-letting Properties: Performance in re-letting properties had improved, with the average turnaround time decreasing from 45.3 days in December 2024 to 33.5 days.
The committee also discussed the Housing Revenue Account (HRA) and Housing General Fund (GF) forecast outturn for 2024-25, noting a significant overspend in the Housing General Fund due to demand pressures within temporary accommodation.
Other Matters
- Cemetery Regulations: The Bandon Hill Cemetery Joint Committee convened to discuss proposed new regulations for Bandon Hill Cemetery, covering memorials, planting, conduct, and fees. No video was provided.
- Health and Wellbeing: The Health & Wellbeing Board approved a themed approach for its forward plan, discussed representation from the voluntary sector, and signed off on the Better Care Fund Year End Submission for 2024/25.
Upcoming Meetings
- Scrutiny Streets & Environment Sub-Committee on Tuesday 24 June 2025 will discuss the council's stabilisation plan, the climate action plan, and the latest financial performance report. Link to meeting
- Cabinet on Wednesday 25 June 2025 will discuss the council's financial situation, its performance against the Mayor's Business Plan, and proposed changes to family services. Link to meeting
- Scrutiny Children & Young People Sub-Committee on Tuesday 01 July 2025. Link to meeting
- Planning Committee on Thursday 03 July 2025. Link to meeting
- Planning Sub-Committee on Thursday 03 July 2025. Link to meeting
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Capitalisation directions allow a council to treat revenue expenditure as capital expenditure, effectively spreading the cost over a longer period. ↩
Recent meetings
Scrutiny Streets & Environment Sub-Committee - Tuesday, 24th June, 2025 6.30 pm
The Scrutiny Streets & Environment Sub-Committee was scheduled to meet to discuss the council's stabilisation plan, the climate action plan and the period 10 financial performance report. The meeting was also scheduled to include a review of the sub-committee's work programme for the coming year.
Scrutiny Homes Sub-Committee - Thursday, 19th June, 2025 6.30 pm
The Croydon Council's Scrutiny Homes Sub-Committee met on 19 June 2025 to discuss key performance indicators, the Housing Revenue Account and General Fund, the stabilisation plan, responses to scrutiny recommendations, and the 2025-2026 work programme. The committee reviewed the Housing elements of the Stabilisation Plan and provided feedback. The Sub-Committee also noted the Cabinet's responses to previous recommendations and discussed the draft work programme for the upcoming year.
Health & Wellbeing Board - Wednesday, 18th June, 2025 2.00 pm
The Croydon Health & Wellbeing Board convened to discuss several key issues, including the development of the board itself, the Better Care Fund, a pharmaceutical needs assessment, local community partnerships, and the Director of Public Health's annual report. The board approved a themed approach for its forward plan, discussed representation from the voluntary sector, and approved the addition of a representative from the Croydon Resident Voices Group to its membership. The board also signed off on the Better Care Fund Year End Submission for 2024/25 and received updates on the Pharmaceutical Needs Assessment and Local Community Partnerships.
Scrutiny & Overview Committee - Tuesday, 17th June, 2025 6.30 pm
The Scrutiny & Overview Committee was scheduled to meet to review the 2025-26 work programme, receive an update from the Executive Mayor, Jason Perry, and discuss the 2024-25 Period 10 Financial Performance Report. The committee was expected to agree on the principles that would guide its work and that of its sub-committees for the coming year. Members were also expected to consider whether any recommendations should be put to the Cabinet[^1].
Bandon Hill Cemetery Joint Committee - Monday, 16th June, 2025 4.00 pm
The Bandon Hill Cemetery Joint Committee convened to discuss several key items, including the approval of the minutes from the previous meeting, a financial update, and a review of the cemetery's regulations. A significant portion of the meeting was dedicated to discussing the proposed new cemetery regulations.
Planning Sub-Committee - Thursday, 12th June, 2025 7.15 pm
The Croydon Council Planning Sub-Committee was scheduled to meet on 12 June 2025 to consider planning applications. The sub-committee was expected to review applications for the change of use of existing buildings, and for building alterations and extensions.
Planning Committee - Thursday, 12th June, 2025 6.30 pm
The notes from this meeting have not yet been summarised.
South London Waste Partnership Joint Committee - Wednesday, 11th June, 2025 6.30 pm
The notes from this meeting have not yet been summarised.
Corporate Parenting Board - Wednesday, 11th June, 2025 5.15 pm
We have not been able to find a video broadcast of this meeting.
Pension Committee - Tuesday, 10th June, 2025 10.00 am
The Croydon Council Pension Committee met on 10 June 2025 to discuss a range of issues including investment performance, compliance, and governance. The committee agreed to note the contents of several reports, including updates on the London Collective Investment Vehicle (LCIV), key performance indicators, breaches of the law, and the risk register. They also agreed to send a letter to The Pensions Regulator (TPR) regarding breaches of the law and to agree to the Fund's draft Communications Policy Statement.
Upcoming meetings
Audit & Governance Committee - Thursday, 26th June, 2025 6.30 pm
Scrutiny Children & Young People Sub-Committee - Tuesday, 1st July, 2025 6.30 pm
Scrutiny Health & Social Care Sub-Committee - Tuesday, 8th July, 2025 6.30 pm