Tempting to think what happening in Downing St was the most important political story of the day. I’d counter that the more important story is this👇
https://twitter.com/lewis_goodall/status/1326643623534981128
Dark whispers have abounded throughout the pandemic that a series of local authorities are at breaking point and on brink of S114. Everyone familiar with LA finance is wondering which might be next and what govt might do. Real and potentially massive impact on people’s lives.
Even Croydon on its own terms is a big story. It has a population of 380k. Would be 11th biggest city in Britain if it weren’t part Greater London. It’s council is now effectively bankrupt.
For those not familiar, a S114 notice is issued when a council believes it cannot balance its budget. They’re rare. Last one was Northamptonshire in 2018. It’s big.
For the next three weeks the council cannot spend money without the permission of the Chief Financial Officer.
For the next three weeks the council cannot spend money without the permission of the Chief Financial Officer.
Labour run Croydon’s finances were parlous going into the pandemic. Some of that was mismanagement, some of it was a decade of profound cuts which had already stripped councils to the very basics. Pandemic hit and its a perfect storm higher obligations plus declining revenues.
Many other councils in a similar position but running on their reserves. Government has given extra money but much of that has been absorbed by extra covid obligations. Hence talk of more councils going into 114. Even if they don’t hit 114, the cuts are coming.
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