Council leader 'proud' of budget despite opposition claims of 'financial mess'

Haringey Council has only been able to set a balanced budget for 2026/27 thanks to a second successive government bailout, reports Joe Ives, Local Democracy Reporter

Tottenham Town Hall with Labour council leader Peray Ahmet (inset left) and Lib Dem group leader Luke Cawley-Harrison (inset right)

Haringey Council will continue to rely on emergency funding, borrowing and council tax rises to support itself financially – following approval of its latest budget.

The 2026/27 budget, voted through at a full council meeting on Monday (2nd), includes tens of millions of ‘exceptional financial support’ (EFS) from the government for the second financial year in a row.

It also sees the council, like many other local authorities, raising council taxes by 4.99% – the maximum allowed. This means the average Band D resident will pay an additional £86 over the upcoming 2026/27 financial year, which begins in April.

An additional £220million of borrowing is also included in the budget plans.

The Labour-led authority argues all these measures are essential for delivering key services.

Speaking ahead of the vote at Tottenham Town Hall, leader of the council Peray Ahmet said the local authority was still “picking up the pieces” of underfunding caused by austerity measures enforced by previous Conservative and coalition governments.

However, some opposition councillors argue the new budget will only make the local authority’s financial predicament worse in the long term, with one member accusing the local authority of “fiddling while Rome burns”.

Nevertheless, Cllr Ahmet said she was “really proud” of the budget, despite the council’s financial difficulties and a further £23.2m of “efficiency savings” set for the coming year, describing it as “in line with our values to deliver a fairer, greener Haringey”.

The “efficiency savings” include cuts to human resources spending and the council’s communications team.

As of this current financial year, Haringey Council has been operating with around £143m less in core government funding (in real terms) than it did in 2010 – a 55% drop.

Partly as a result of this, the government’s Fair Funding Review, which concluded in November last year, confirmed Haringery Council will see a £75.6million financial boost over the next three years.

The 23% increase in the borough’s ‘core spending power’ represents the joint 14th-highest percentage increase in London.

However, with a projected overspend of around £23m for the current financial year, the council was still granted £54m in EFS to help see it through 2025/26.

EFS allows councils to treat some day-to-day spending as longer-term capital spending, which is usually funded through borrowing. A total of 37 authorities across England have been granted exceptional financial support for the 2026/27 year – seven more than in the previous year.

Despite this measure being deployed last year and the financial boost from the funding review the local authority again applied for EFS for 2026/27, this time at £84m – the fourth highest in England.

The leadership says this is due to financial shortfalls primarily driven by rising demand in adult social care and temporary accommodation.

In their budget report, Haringey Council officers warned that every £1m raised through EFS “typically adds around £62,000 per year in costs over 20 years, reducing flexibility for future investment and increasing the structural gap in revenue budgets”.

More than £220m of the council’s planned spending is anticipated to be funded from borrowing in 2026/27 alone. Using the council’s own projections, the £84m EFS sum could cost the local authority an additional £104m over the next two decades.

Speaking ahead of the vote the leader of the Liberal Democrats opposition group, Luke Cawley-Harrison, argued the budget “is clearly not a recovery plan for the financial mess the council is in”.

“It’s a plan of managed decline, once again fiddling while Rome burns, ” he added.

“Austerity hit Haringey as it has all local authorities and it has clearly changed the dial, ” the opposition leader acknowledged, but argued the council had made things worse by continuing “to borrow and spend like they had discovered the magic money tree”.

Lotte Collett, a member of the Green Socialist Alliance, recognised the importance of spending on essential services but said the budget was unsustainable. The use of EFS “creates further chaos, ” added Cllr Collett, referring to a description of the scheme as “akin to payday loans for councils”.

An amendment put forward by Cllr Cawley-Harrison, which included measures such as setting up a new council board chaired by the Lib Dems to “to immediately commence the work of complete root-and-branch reform of council operations and financial oversight” was rejected by the council.

Senior Labour councillor Zena Brabazon responded to these criticisms, saying she was “aghast” by some of the opposition’s comments, adding: “I thought I was listening to Mrs Thatcher!”

“We’re socialists on this side of the council, ” said Cllr Brabazon, “and we actually believe in investing money in public services – not making cuts and not believing in the cycle of austerity”.

Like the council leader, Cllr Brabazon blamed the borrowing on the austerity measures of the previous Conservative and coalition governments.

The cabinet member also pointed to the budget’s investment in schools and special educational needs provision. “None of that comes cheap, ” she said, arguing the council had reconfigured its budget accordingly.

Cllr Brabazon referred to the 20th Century economist John Maynard Keynes, who argued government spending could help an economy get out of financial difficulty in the long run.

“I make no apology at all for our spending the money, ” she said.

“Keynes said you should spend money digging a hole in the ground didn’t he? In the 1930s, in the depression – and Keynes was right,” added Brabazon.

“We are spending money in our borough on our infrastructure, on our schools, on our young people, on children, on families – so I think we have done a great job.”

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