Croydon Council has formally ended section 114 notice spending restrictions but will continue with its own tight financial controls as part of a long-term recovery plan.
The section 114 notice, which had been in effect from 11th November, meant that all expenditure went through a regular spending control panel and non-essential spend was stopped. Essential services continued throughout, such as supporting vulnerable adults and children, housing repairs, keeping the borough’s streets clean and safe, and the ongoing pandemic response.
Following government approval earlier this month of a £120m capitalisation direction, which meant Croydon could balance its in-year budget and set one for 2021-22, on Monday evening the cabinet were advised by the council’s finance director that the section 114 notice had lapsed as the council was able to balance the 21/22 budget.
The direction is conditional on the council delivering its renewal improvement plans and providing regular progress to the government-appointed Improvement and Assurance Panel.
Croydon’s Renewal Plan is a major programme mapping out proposals for further savings, strengthening governance and financial practices, bolstering reserves and new ways of working to put the borough on a more sustainable financial footing.
The budget will give priority to supporting high numbers of adults and children in need, keeping the borough’s streets clean and safe and addressing funding gaps caused by the demands of tackling the Covid-19 crises, which has already cost Croydon over £46m.
The council’s spending control panel will continue to meet regularly as part of the council’s ongoing approach of greater financial discipline.
“Although the section 114 notice is no longer in place, there is still a lot of work to be done and savings to find for the council to live sustainably and within its means for the long term.
“That means we must continue to keep a tight rein on our finances, keep working closely with the government-appointed improvement panel and deliver our improvement plans so we make the changes needed while providing vital services to our residents.”
Councillor Hamida Ali, leader of the council