Haringey Council has been reassured about the state of its finances following an earlier warning that it needed to find urgent savings.

An independent auditor brought in to check Haringey’s accounts said its cash reserves were “reasonably healthy” and the council had a grip on its savings plans.

But he warned the situation could get “very tight” if the council did not manage to make those savings.

Earlier this year, a team from the Local Government Association (LGA) praised the council’s ambition but warned that failing to tighten up financial monitoring could lead to a “precarious future for the council and its services”.

The LGA report says the council needs to find an extra £20 million of savings over the next five years as it faces a “growing gap between income and expenditure”.

It adds that around £13 million of the savings need to be found by October this year to avoid the council having to continue raiding its reserves.

But Leigh Lloyd-Thomas, from the council’s external auditor BDO, told Thursday’s (July 25) corporate committee the council was not in a particularly bad financial position.

He said the council was still running an £8 million overspend but had “some reasonably healthy reserves to cover that”.

Mr Lloyd-Thomas said: “I have seen a lot worse. We think you have got a grip on what your savings plans need to be and plans to close your budget gap.

“You can carry on for a few more years with some slippage, but it will get very tight in a few years’ time if you do not deliver that.

“As of today, you won’t be having to do a fire-sale budget and sell all the crown jewels.”

Labour councillor for St Ann’s ward Cllr Noah Tucker asked for reassurance that the council was not heading for a “cliff edge on the issue of reserves” that would lead to “serious trouble”.

Mr Lloyd-Thomas pointed out that the council had recently put money into its reserves.

He said: “We see councils dipping into their reserves to fund capital projects, shopping centres. You have not done that. We know there are plans to borrow, but that is affordable borrowing.

“Maybe if you carry on at the rate you are, in three or four years’ time I will be having more difficult conversations with you – but you are not one of those councils where we’re having that conversation now.

“I am pretty comfortable you know what you need to do. You are trying to find not just cuts, but how to use your money better.”

Like many councils, Haringey has been forced to make huge savings since 2010 after having its funding from central Government slashed.

After a change of leadership in 2018, the local authority launched several ambitious schemes, including a plan to provide 1,000 new social homes by 2022.

The council recently announced it would provide more regular financial monitoring in response to the LGA report.

It has also launched an “invest-to-save” scheme in children’s services in a bid to relieve some of the budget pressure in that area.



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