Waltham Forest’s plan for financial stability

Waltham Forest is a well-run council with a track record of delivering improvements that make a real difference to people’s lives. We are the safety net that catches residents in need, and we work hard to support those who require help. However, after over ten years of increasing demand for our services alongside underfunding from successive governments, we need to take steps now to safeguard our financial stability in the future. To help balance the books and keep Council Tax rises below 5 per cent, Waltham Forest has applied for £19m of Exceptional Financial Support (EFS) from the government. 

This loan will be used to fund the essential day-to-day services on which residents rely.  This will free up the time and resources necessary to accelerate delivery of a major programme of change, one based on a fundamental rethink of the way the council designs and delivers its services for residents. It represents a continuation of our mission to achieve a fairer and more equal Waltham Forest - and this will be at the heart of how we take the changes forward. 

We have a clear plan for how we will use these funds - and how we will repay the loan. We are working towards being in a financially stable position in three years' time with at least £30m in reserves. Our plan will place Waltham Forest on a sound and secure financial footing for years to come. It will change how we work, and the way in which we support our residents – for the better. 

Currently, 72p in every £1 we spend is used to support the most vulnerable members of our community. This money goes towards ensuring families at risk of being made homeless do not end up sleeping rough; it goes towards helping children with special educational needs or disabilities as they grow up; it goes towards helping older residents who are struggling to cope. We have a moral duty to make sure those in need continue to receive our help and support. 

We will put far greater emphasis on prevention, addressing spiralling demand in our highest cost services by making sure that our residents in need are given the right help at exactly the right time, meaning we reach them way before they reach crisis point.  This better targeted early help will mean they avoid situations that place them in even greater risk and vulnerability, largely or completely dependent on help we give – for example, through a loss of independence or the loss of a home. 

We know, for example, that the risk of losing a home is incredibly difficult for those who experience it. It disrupts children’s education, threatens important support networks, and jeopardises employment. However, the cost of arranging temporary accommodation continues to rise year-on-year and is putting a serious strain on council budgets. That's why we are already piloting initiatives that prevent the need for temporary accommodation, including working directly with tenants who are beginning to fall into rent arrears with help to manage their finances, avoiding the risk of homelessness entirely. 

We will be delivering major improvements to the customer service we offer to residents. We will be working to get everyone to the help and information they need easily and with minimum delay. We will also simplify and modernise processes across the council to deliver improved value for money and effectiveness, including through better and more widespread use of data and technology. 

Benefits will be felt across all of the services that matter most to local people - from bin collections and road repairs to maintaining parks and supporting culture. 

The people of Waltham Forest know better than anyone what works best for them. They are the experts in knowing what services and support will make the most difference to their lives. We are bringing Waltham Forest residents, community groups, charities, and local partners into the conversation about how, together, we can all contribute. 

Our plan will take significant time and effort. It must be done right. It will mean the council will look different three years’ time and will be more closely aligned with what residents want and need. 

Seven London councils have already applied for EFS, and London Councils has previously forecast that up to half of London boroughs (17 of 32) could potentially need EFS by 2028. Waltham Forest is not alone in asking for extra support. London boroughs face a cumulative budget gap of £4.7bn over the next four years. Finance pressures are particularly extreme in temporary accommodation provision, adult social care, and children’s services – all statutory services where boroughs have legal duties to uphold. London Councils forecasts that in 2025-26 boroughs in the capital will overspend on temporary accommodation by £210m, on adult social care by £140m, and children’s services by £90m. This is primarily due to rising demand for services.   

London’s worsening homelessness emergency remains a critical risk to boroughs’ financial stability. It is estimated that a record 210,000 Londoners - equivalent to around one in 50 - are homeless and living in temporary accommodation arranged by their local borough. 

Since 2011, Waltham Forest has made approximately £140m of savings. However, despite this, we are facing a £33m overspend this year. Our biggest challenges are temporary accommodation, adult social care, and SEND services.  

Temporary accommodation costs alone accounts for just under half of our forecasted overspend – in 2025 / 26 we are expecting total spend of £22.9m compared to £8.5m in 2019 / 20. The costs of temporary accommodation have spiralled while demand has also increased by 80 per cent over the two years leading up to March 2025.  

Our housing sustainment team – one of the first of its kind in London – works with households who rent privately and are at risk of running up arrears to prevent the problem getting worse. We help them understand the benefits they may be eligible and liaise with landlords to avoid eviction notices being issued. This work does not just save money by preventing the need for a temporary accommodation – it also saves real people from needless stress, worry, and hassle.  

The council has a statutory and moral duty to support children with special educational needs and disabilities (SEND). The number of children who receive Educational Health and Support packages (EHCPs) has risen by 39 per cent in the last two years. Each one of these children deserves extra care and support to help them enjoy full, healthy lives.  

We are investing in local SEND support services that will mean fewer of these children will need to travel for long distances to access specialist care. This will help address the cost of home-to-school transport, which accounts for around 7 per cent (£2.6m) of our in-year overspend, and at the same time allow these children more time with their families and friends.  

The council is well on track to deliver £16.6m worth of savings this year too, achieved through piloting ways of working that save money and improve lives. These new ways of working will soon be at the front and centre of all that we do. 

In December 2025, the government announced more funding for local authorities like ours, as you may have seen reported in the media. While it was a positive first step, it does very little to change our situation - or that of any other London council. 

Most of the money quoted in the figures reported we already receive in the form of grant funding and Business Rates. For Waltham Forest, the total increase next year will be in the region of £18m and includes the assumption that council tax will increase by 4.99 per cent. The Council’s funding is still 6.4 per cent lower in 2026/27 compared to 2010/11, when adjusted for inflation. 

Given our £33m service overspend this year and our diminishing reserve balances, and despite all the savings we have made, £18m will not be nearly enough to help us balance our budget. 

Cllr Grace Williams, Leader of Waltham Forest Council said: “We have taken the financially responsible - and morally correct - decision to apply for Exceptional Financial Support (EFS) to deliver our budget for this coming financial year. 

“The extra money will take the form of a loan of up to £19 million, underlining our pledge keep Council Tax rises below five percent.  

“We have a very clear purpose for the use of these funds - and a plan to quickly pay back the loan. The extra money will protect services while balancing our budget in the short term.  

“It will free up the time and resources necessary to accelerate a plan to fundamentally change to the way the council works. Benefits will be felt across all of the areas that matter most to local people - from bin collections and road repairs to maintaining local parks and supporting culture. 

“We will focus on services for our most vulnerable residents in particular, not only because – by law – we must help them whenever they are in greatest need, but also because it is morally right we do so.  

“This is where almost three-quarters of our money goes – a staggering 72 pence in every pound the council spends. 

“When a family needs a roof over its head, or when an older person can no longer cope on their own, we will always step in. But in future we will act far earlier, before they reach crisis point, reducing the need for our highest cost services.  

“We are already piloting initiatives to achieve this aim. For example, our housing sustainment team works with private tenants beginning to fall into rent arrears to help manage their finances, avoiding the risk of homelessness and the need for temporary accommodation.  

“We are investing in quality local SEND services, providing help for children closer to home and reducing costly transport bills. 

“And we will be delivering major improvements to the customer service we offer, working to get everyone to the help and information they need easily and with minimum delay. 

“We will also modernise processes across the council to help us deliver improved value for money and effectiveness, including through better and more widespread use of data and technology.  

“The people of Waltham Forest know better than anyone what works best for them; they are truly the experts in knowing what can make the most difference in their lives, and to the borough. So, we will soon be bringing them into the conversation about how, together, we can all contribute.  

“Waltham Forest is well known as a small borough with big ideas. And this is why we have made a choice to seek extra support - to enable changes we feel we must make, changes that we firmly believe our residents deserve.”