Royal borough seeks exceptional financial support to stave off section 114 notice
The Royal Borough of Windsor and Maidenhead is in talks with the Department for Levelling Up, Housing and Communities (DLUHC) about receiving exceptional financial support (EFS) over its "untenable" financial situation.
The request comes in light of more than £200m in debt, reserves of just £10m, and in the wake of a forensic accounting exercise that uncovered surprise costs at the local authority.
According to the council, its reserves of £10m are thought to be the lowest of any unitary authority. The council's debts, meanwhile, rose from £58m in 2014 to £204m by March 2023.
The council also pointed towards year-on-year reductions to council tax between 2010 and 2016 for its financial predicament – noting that the reductions left its budget £30m lower than if council tax had risen in line with average increases across the country.
The council also recently embarked on a forensic reconciliation of its budget and balance sheet transactions, which uncovered more historical costs that were not previously budgeted for.
In a statement, a council spokesperson said the costs, coupled with its low reserves, made the council's position "untenable in the short-term – unless additional financial support is agreed to provide the council with the time needed, in the medium-term, to deliver its plans to become financially stable".
The statement added: "Access to additional funding at this point would give the council a breathing space to deliver its planned transformation programme and reduce the risk of having to issue a statutory Section 114 notice, which would lead to severe consequences for the borough and local people."
It also noted that EFS arrangements are already in place for 19 other councils in 2024/25.
Cllr Lynne Jones, the Royal Borough's Cabinet Member for Finance, said: "We're confident in our plans to make savings this year and transform the council over the medium-term.
"But we continue to find historical unfunded costs in the budget, and in previous years, which need to be set against the council's already minimal reserves.
"We are determined to ensure that we can state the true financial position of this council and our figures going forward are accurate and robust."
She said EFS from the Government will "give us the time and capacity to deliver our plans and achieve the transformation needed to become financially sustainable, while continuing to maintain services for residents".
She also announced that the council has commissioned CIPFA to review its financial processes and the robustness of its plans.
Adam Carey
