London's temporary accommodation crisis blamed as council overspend goes from £4m to £17m in 3 months

An East London council has forecast a budget overspend of £17.2million by the end of this financial year. As of the end of June, Barking and Dagenham Council had forecast an overspend of £3.8m however in the space of a few months this has now increased by £13.4m.

The council said in a Cabinet report that its projected overspend of £17.2m as of the end of September has been caused by an increased demand and a rise in costs brought on by inflation. Several services have been identified in the report as 'key organisational risks' and could cause further strain on the council's budget, including within temporary accommodation and social care.

On temporary accommodation, the council said it was at capacity within its own hostels and had received several hand-back requests from private landlords, which may force the council to move residents to more costly accommodation such as B&Bs and hotels. The council has also identified further pressure in its social care budgets due to there being less funding available.

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The report noted: "As costs of care are very high even small changes in numbers of people needing support can cause large swings in the overall forecast. The Adult's Service was holding some health funding in reserve to offset against potential winter pressures, but this has now been released to offset budget pressures much earlier than anticipated, which carries significant risk."

During a Cabinet meeting last week (November 12), council leader Dominic Twomey called the situation 'extremely challenging'. Mr Twomey said: "You can see a forecast overspend of £17.2m at the halfway point of the year, so I doubt anybody could describe it as anything less than challenging, and some may describe it as significantly more so."

He later said: "Overall colleagues, we are heading into the second half of the year with significant challenges facing us, and on top of that we, as you know, are beginning a process of budget consultation for next year as well."

After Mr Twomey finished presenting the report, Cabinet members had the opportunity to speak, however no one did so they proceeded to agree the recommendations set out in the report.

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