Worthing budget crisis: More housing and parking charge increases among considerations amid bankruptcy threat

Worthing Borough Council could look to build more houses – and increase parking charges – as it aims to reduce the risk of bankruptcy.
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A forecast £1.8million overspend by Worthing Borough Council has left services and assets under review.

The council’s cabinet reported the figure to a meeting of the joint strategic sub-committee, on September 19, for the 2023/2024 budget – about a 12.9 per cent overspend of the set budget.

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It followed a £2.1million overspend in the 2022/2023 budget, where the council ‘narrowly’ avoided bankruptcy by using money from reserves, reducing them to £300,000 – now proposed to be used for this year’s budget.

A drone image of Worthing. Photo: Eddie MitchellA drone image of Worthing. Photo: Eddie Mitchell
A drone image of Worthing. Photo: Eddie Mitchell

The issue was discussed during a media briefing at Worthing Town Hall last week.

John Turley, cabinet members for resources, said: “We were given the bad news that we have a deficit of £1.8m. It’s a combination of expenditure being above budget and income being below.

“The day-to-day spend and income isn’t balanced. That was always the case when we came in but that deficit has grown in 2022.

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"It’s mainly due to the economic situation, inflation and energy costs going up.

Worthing Town Hall. Picture: GoogleWorthing Town Hall. Picture: Google
Worthing Town Hall. Picture: Google

"Homelessness has increased as a result of the cost of living crisis. More people coming to us presenting themselves as homeless. We have to house them as a statutory duty requirement.

"The cost per case has gone up as well. We have to house them in emergency and temporary accommodation that we normally wouldn’t want to use.

"It’s crucial that we generate more emergency and temporary accommodation of our own and not just paying for people to stay in Travelodges.

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“Millions can be saved if we can acquire our own accommodation. Homelessness situation isn’t going to get any better – it’s only going to get worse. We have to be ready for that.”

Mr Turley said councils across the country are facing an ‘awful lot of pressure’.

He added: “We need more funding from central government and more certainty. We would like to see three or five year settlements so we can plan ahead. It’s very difficult to plan ahead whilst we don’t know what we are going to get year on year.

“We are looking at our spend through a more intense exercise. Heads of service are looking at their spend to see where we can make savings this year. We have to protect our frontline services but we are looking at areas we can reduce or stop spend.

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"We want to protect all our services if we can. It’s dictated by our financial situation. We are expecting officers to report back to us later this month.”

Mr Turley said the council is facing a ‘serious situation’ but is confident the ‘forecast is robust’.

"I don’t think there’s anything in there that should get worse,” he said. “It shouldn’t get worse unless something unforeseen happens that we couldn’t have predicted.

“In an ideal world we could get to ground zero. We have to get to position where deficit will be recorded by reserves. It’s at £1.8m and we have to at least half that. That’s the realistic target.

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“If we can’t present a balanced budget, then yes [we would be bankrupt]. We believe we are not at that stage yet. We don’t want to be at that stage.

"We are not in a position we are close to declaring ourselves bankrupt. We have the opportunity to turn things around and reduce that deficit."

Carl Walker, deputy leader of the council, said: “We have to be innovative with the money we do have and use it in right ways. Nothing has been decided. Will have discussions this month.”

Mr Turley said ‘there’s a strategy in place’ to present a ‘balanced budget for future years’.

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He explained: “More money is going out than coming in and we can’t allow that to continue. We have to address that.

"Council tax is our main source of income and we can help that by building more housing. There are housing developments in the pipeline which will boost council tax.

“The other strand is commercial income – car parking, commercial waste, green waste and beach huts, etc.

"It’s not just about putting up fees, we need to find new sources of income. We are selling off assets which is not ideal but councils are under so much pressure.”

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Mr Turley said town centre parking ‘will be looked at’, adding: “We’ve seen income from the crematorium and from car parking reduced during the pandemic. It simply hasn’t picked up.

“Charging an extra 30p shouldn’t stop anyone coming into the town centre. It would be a smaller increase than in June.

“We will have to make decisions but everything we do will be about helping the town to continue to thrive with things people like. We have to think about what’s fair and what protects our public and green spaces.”

Emma Taylor-Beale, housing and citizen services, said the council has managed to make savings of £5m in the last six to eight months.

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She said: “We've been presented savings of £5m with another £3m in the pipeline.

“We have done so well and yet we still need to do more.

"The frustration for me is this didn’t happen overnight. It annoys me when we talk about Covid and economic downturn. Yes they played a part but the issues around homelessness have been building and building.

"Now we are having to take emergency action but we should have been contingency planning all along.”

“I want to be as helpful as possible to as many people as possible. We are having to send so many people out of the area. It showed how desperately we need to be taking control and responsibility for our own people.”