Kathy Freeman, the council's director of resources, stated: 'Every single year, we're going to have a budget deficit that's carried forward until the system fundamentally changes. Unfortunately, we're not able to set a legally balanced budget again, unless we go through the route of applying for another capitalisation direction [a loan].' This reveals the council's ongoing struggle to balance its budget amidst increasing deficits.
Freeman emphasized: 'We've been really open with MHCLG that unless there are fundamental systemic changes to the funding system, we're going to be in this position year on year. We desperately need something to change.' This illustrates the council's urgent need for reform in funding to address its financial crisis.
Council leader Ray Morgon mentioned: 'There's certainly the will to put those things right, but the big challenge for them is how they raise the necessary revenue to support councils and the public sector.' This highlights the challenges faced by leadership in securing sufficient funding for local authorities.
Ms Freeman stated: 'It's positive that we've seen an additional 1.3bn [allocated in the budget for local governments across the UK], but when you boil down what that means for Havering, it will be at best 3m or 4m.' This underscores the inadequacy of the funding increase relative to the town's needs.
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