Croydon has set out plans to go further and faster in changing the way the Council works to help tackle its financial challenges.
Through accelerating its Future Croydon transformation plan, Croydon is proposing to deliver extra savings of £27.3m this financial year, in addition to the £21m savings already set out in its 25/26 budget.
These savings are set out in a new Stabilisation Plan, which the Government has asked the Council to develop owing to its need for exceptional financial support.
Like many councils Croydon is experiencing extreme budget pressures owing to increased demand for services and costs of temporary accommodation, social care placements for adults and children, and SEND transport. These pressures are exacerbated by the Council’s £1.4bn debt burden which this year, costs £70m to service.
Croydon’s Stabilisation Plan aims to mitigate these budget pressures by accelerating actions from the Council’s Future Croydon transformation plan. Developed last year, Future Croydon is about making the Council more cost effective and efficient by modernising services. Bringing Future Croydon forward will help the Council to manage demand and reduce costs, relieving pressure on its finances.
Stabilisation Plan actions range from opening a new children’s home to reduce placement costs, to increasing the number of in-house foster carers and improving efficiency in its housing and homelessness service.
The Council will improve its contact management to make sure it achieves value for every penny spent, and increase income.
The Plan includes reducing reliance on agency staff and, as the Council changes the way it works, there will be some reduction in the workforce, though there will be opportunities for staff to upskill and redeploy.
Croydon has met 96% of the objectives in the Exit Strategy – the plan for the Government-appointed Improvement and Assurance Panel (IAP) to leave the council by July 2025.
Over the past 12 months, Croydon has made significant progress in improving the Council. This been recognised by the Government, the Local Government Association (LGA), the Council’s auditors, the Regulator for Social Housing and Ofsted. Croydon was recently shortlisted for a national local government award for Most Improved Council.
Despite this progress, the Council cannot meet its Exit Strategy objective relating to financial sustainability without Government action on increased demand and costs for councils, and a resolution on its debt burden.
Whilst the Stabilisation Plan will help to improve the Council’s financial position, the plan cannot deliver a balanced budget in 25/26. It is to demonstrate that the Council has done everything possible to improve its financial situation whilst delivering sustainable services to its residents.
The Council has published its Stabilisation Plan today for consideration by the Council’s Scrutiny and Overview Committee, ahead of a decision by the Executive Mayor and Cabinet in June.
The IAP are required to agree the plan in accordance with the conditions for the exceptional financial support for 25/26.
“As a Croydon resident born and bred, I am fully committed to tackling the Council’s financial challenges so that it can deliver good local services, value for money, and be a place that we can all be proud to call home.
“We have made strong progress in improving our Council but increased demand and rising costs in essential services – combined with our £1.4 billion debt burden – has placed considerable strain on our budgets.
“My top priority has always been, and remains, to fix the Council’s finances. This means leaving no stone unturned, but we must do so in a way that is sustainable, responsible and does not decimate our borough.
“Our Stabilisation Plan represents that. We developed our Future Croydon transformation plan by listening to our staff, residents and partners and we are not changing course. Instead, we are going to accelerate those plans and go further and faster. I will be working with all our communities as we deliver this change and make our Council more efficient, cost-effective and sustainable for the people we serve.”
Jason Perry, Executive Mayor of Croydon
Read the Scrutiny and Overview papers (item 5)
