Council tax arrears in Epsom and Ewell have reached £1.8 million, according to new figures from the Department for Levelling Up, Housing and Communities. The amount contributes to a record £6.6 billion of outstanding council tax across England, highlighting a deepening crisis in household finances.

The local figure reflects the ongoing pressures of the cost-of-living crisis, with many households struggling to pay essential bills. National Debtline, the free debt advice service run by the Money Advice Trust, reports that one in four people contacting them for help has council tax debt, with an average shortfall of £1,958 per person.

Research from the Money Advice Trust found that, as of March 2025, around 2.2 million people in England — equivalent to 5% of households — were behind on their council tax.

Council tax is a critical source of revenue for local authorities, funding services including social care, waste collection, and local infrastructure. But with budgets increasingly stretched, councils have relied more on council tax income, pushing bills higher and making payment harder for some residents.

Currently, rules mean that if a resident misses a single council tax payment, they can become liable for the full annual amount, which can quickly escalate to court action and bailiff involvement.

In response, the Government has proposed extending the timeframe before enforcement action begins, giving people more opportunity to catch up on missed payments. The Ministry of Justice has also announced a consultation on strengthening oversight of the bailiff industry, with proposals to give the Enforcement Conduct Board statutory powers to regulate bailiff practices.

Steve Vaid, Chief Executive of the Money Advice Trust, said:

“Unless changes are made at a policy level, arrears are likely to keep climbing. At National Debtline, we’re calling for improved collection practices, as well as greater investment in council tax support schemes, to prevent people falling behind in the first place.”

National Debtline encourages any resident worried about their council tax payments to seek free, independent advice before their debts spiral. Their helpline is available on 0808 808 4000 or via www.nationaldebtline.org.

Government Spending Review Falls Short for Surrey Councils and Epsom Hospital, Say Local Leaders

The UK Government’s latest Spending Review has drawn a mixed reaction from Surrey leaders, with concerns mounting over local council finances and delays to urgently needed hospital upgrades in the Epsom area.

Surrey County Council: Welcome Commitments, Ongoing Pressures

Responding to the Chancellor’s announcements, Surrey County Council Leader Cllr Tim Oliver acknowledged “important announcements,” including increases in core funding for local government, funding pledges for children’s services, and a renewed commitment to reforming Special Educational Needs and Disabilities (SEND) provision.

However, Cllr Oliver warned that the headline increase in “core spending power” rests on councils raising council tax by the full 5%—a move that may place strain on households during a cost-of-living crisis. Even with that assumption, county and unitary authorities across England are projected to face a £2.2 billion funding gap next year.

“Whilst our finances have been transformed to a point where we have delivered stable, balanced budgets year after year,” Oliver said, “we are not exempt from the financial challenges faced by councils.”

Oliver stressed the urgency of the upcoming Fair Funding Review, calling for a “fair and proportionate” outcome to ensure long-term stability for local authorities like Surrey.

Locally, the council has invested an additional £15 million into a three-year SEND recovery plan, begun in September 2023, which is reportedly beginning to bear fruit. But Oliver added that the government’s announcements stop short of tackling deeper issues. “Provision and support for children with SEND is a systemic issue… and the current system does not work for families, schools or councils,” he said.

SEND Deficits and Budget Certainty

Perhaps the sharpest criticism came over the government’s silence on the spiralling SEND deficits many councils face. Without intervention, these deficits—currently kept off balance sheet—will be formally accounted for from next April.

“Many local authorities, including Surrey, are facing a continuing increase in demand in comparison with levels of funding received,” Oliver said. “Councils will soon start planning their budgets for next year and cannot afford to have this can kicked down the road any longer.”

Future of Local Government in Surrey

The Spending Review did include a continued commitment to Local Government Reorganisation (LGR)—a development welcomed by Surrey County Council. Surrey recently submitted a proposal to transition to two unitary authorities, a move that could reshape local government in the county.

“We have worked hard to form that proposal,” said Oliver, “to deliver the best possible outcome for Surrey residents.”

Local MPs Condemn “Missed Opportunity” for Epsom & St Helier Hospitals

Meanwhile, the Liberal Democrat MPs for Epsom & Ewell, Carshalton & Wallington, and Sutton & Cheam expressed deep disappointment over the absence of additional investment in the long-delayed redevelopment of Epsom & St Helier Hospitals.

Despite a known £150 million repair backlog, the government has only committed £12 million to date, with the timeline for a new specialist emergency hospital now postponed until 2033 under the Labour government. Local MPs Bobby Dean, Helen Maguire, and Luke Taylor said this continued delay threatens the “very future of our hospitals.”

“The Government has missed a massive opportunity to deliver real change for Epsom & St Helier Hospitals,” they said in a joint statement. “£12 million is simply a drop in the ocean.”

The trio highlighted years of cross-party pressure in Westminster, including Prime Minister’s Questions and debates, aimed at securing vital upgrades for the “crumbling” estate. “After 14 years of broken promises, the Government has an opportunity to do better,” they added.

Rising Council Tax on the Horizon

Further national analysis has added to concerns around the financial implications of the Spending Review for local authorities. Paul Johnson, Director of the Institute for Fiscal Studies (IFS), noted that while English local government fared “perhaps a little bit better than it might have expected,” there is a “sting in the tail”: council tax bills are now set to rise at their fastest rate of any parliament since 2001–2005.

Chancellor Rachel Reeves confirmed that councils’ core spending power will rise by 2.6% annually from next year. However, this figure is based on the assumption that councils will impose the full 5% annual increase in council tax—an option many local authorities may feel compelled to take. “We won’t be going above that,” Reeves said. “That is the council tax policy that we inherited from the previous Government, and that we will be continuing.”

Liberal Democrat deputy leader Daisy Cooper described the overall package as a “missed opportunity,” warning that council budgets—especially in areas such as social care—remain “very, very stretched.” She added: “The Government is now looking to local councils to put up council tax to plug the gap in these particular areas… We cannot wait. This can’t be kicked down the road any longer. The Government has got to act now.”

For residents of Epsom and Ewell, the message is clear: whether through delays to vital infrastructure or increasing local taxation, the burden of national decisions may be felt most acutely at the community level.

Surrey Heath Borough Council’s desperation to fight off bankruptcy crystallised further after it agreed to sell a car park and land in order “to keep the lights on”. The council has to make huge cuts this year to balance its budget after long-delayed audits revealed millions of pounds was missing from its balance sheet. This included more than £8m wiped off its reserves effectively overnight and the downgrading in value of its major assets bought as part of a £100m regeneration project.

On Tuesday, May 21, the council agreed to sell Woodend Road car park in Deepcut and land on London Road in Camberley to begin to claw back desperately needed cash. Failure to balance its books would result in the loss of support given to the community through things such as meals on wheels type services, funding for Citizens Advice Bureau, children’s play parks, and other non-statutory provisions. It comes as the council must shed £1.74m this year through savings, reduced interest payments and a further £500,000 from “service delivery reviews”. The purpose of any potential disposal of land, the meeting heard, is to bring in money for a council “in financial distress and we cannot incur further related costs”.

Shaun Macdonald, leader of Surrey Heath Borough Council, said: “Car park, play parks, discretionary services, the support we give to the local community will go in the blink of an eye, so yes these are tough decisions but these were the tough decisions we were elected to make in order to protect the most vulnerable in our society. Two to four play parks can be renovated (instead) for young people to enjoy for the next 15 years. How many young people will benefit from that? Citizen’s Advice Bureau funding, it can also support, potentially the provision of meals in people’s homes.”

These are the first tranche of sales the council is deciding on. Decisions made are being based on what the council considers is best for the entire borough, rather than the specific area affected. Car parking in Surrey Heath is particularly vulnerable as, by law, it does not need to be provided – and any council that declares itself bankrupt cannot spend money on discretionary services that do not pay for themselves. Parking in Surrey Heath loses money.

The London Road land sale, described as a “small plot”, is said to have no value financially to the council but incurs unnecessary costs. Cllr Murray Rowlands (Labour: St Michaels) said it had been “blighted with fly-tipping and parking” and was “a serious problem that affects the whole of that part of Camberley.” Cllr Macdonald added that it was “a fly tippers’ paradise.”

The Deepcut car park sale proved more divisive, and not just among the opposition members who were calling for the sale to be halted on the grounds that it would deprive the area of much needed parking spaces. Deepcut is undergoing a massive transformation with the former military barracks being turned into a huge redevelopment.

Cllr Cliff Betton (Liberal Democrats: Mytchett and Deepcut) said: “I fully understand the need for the council to raise funds from the sale of assets surplus to requirements. We have to have a balanced budget at least until the time the new unitary authority comes into being. After that, Surrey Heath Borough Council will cease to exist and it will be up to others to make decisions for the people of Deepcut. Everyone knows there are plans approved for Deepcut and it’s now renamed Mindenhurst; 1,200 homes are being built, some are already completed and there are still another 800 still to come. Parking for the old Deepcut village pre-Mindenhurst was ok, it worked, sometimes a bit crowded but the car park was well used. But this will see just eight car park space increases in a village with 800 new homes, a ratio that doesn’t even meet Surrey County Council’s standards. If we want to build a better future for Deepcut, and Mindenhurst is part of that, we cannot build in parking blight from the outset. Woodend Road needs to stay as a car park.”

Cllr Kel Finan-Cooke, property and economic development portfolio holder said: “We would prefer to not have to make decisions like this. We would prefer to not be in a position where we are need to achieve capital receipts to keep the lights on at Surrey Heath for the next two years but that’s the situation we are in. We don’t want to have to consider the sale of lands but we absolutely must.”

Woodend Road Car Park in Deepcut (image Google)

The “chief architect” behind the financial collapse of Woking Borough Council should be stripped of his OBE to local government, the town’s MP has said. In 2023 the council declared itself effectively bankrupt with debts expected to pass £2.6billion on the back of a failed regeneration scheme. It has led to some communities resembling a ‘bomb site’, heaped huge tax rises on residents’ bills and a gutting of popular public services.

Now, the town’s MP has said one of the drivers of Woking’s financial decisions should be held accountable. In February 2025, the Financial Reporting Council (FRC) announced it was looking into the “professional standards” of two “individual accountants” – one of whom is Ray Morgan in respect of Woking Borough Council’s operations and investment activities. Mr Morgan served as CEO for 14 years before retiring in March 2021 having been made an Officer of the Order of the British Empire in 2007 on the back of green initiatives he oversaw. His efforts even drew praise from King Charles while he was the Prince of Wales who said it was an example of local government “enhancing the wellbeing of its residents — now and in the future.” Mr Morgan described being given the award as an honour and that he was disappointed the MP for Woking should seek its removal.

Mr Morgan was identified in November 2024 as being “the principal architect of the council’s investment decisions” based on clear “documentary evidence and the information provided by stakeholders”. Addressing the Houses of Parliament was the Woking MP Will Forster. He said: “The former chief executive of Woking borough council, Ray Morgan OBE, has been identified in a public interest report as the chief architect in bankrupting my council, leaving it with debts of £2 billion. Does the Leader of the House agree that the very least the Government could do is remove his OBE for services to local government? Will she agree to hold a debate in this House so that we can discuss Government policy on removing honours when wrongdoing has been committed?”

As well as singling out the actions of Mr Morgan, the MP also pushed for a debate on the removal of honours from any individual found to have committed serious failings in public office. Responding, Leader of the House Lucy Powell MP, said she was “really sorry” to hear about the case and urged him to contact the special committee that convenes to look whether individuals should be allowed to hold on to their honours where “there is a strong case for nominations to be removed.” She said: “It is absolutely right to say that we need to make sure that people are held accountable for their actions. Where they have received nominations, that is something that we should consider.”

Mr Forster said he has now formally submitted a letter to the Honours Secretariat calling Mr Morgan’s OBE to be removed. Mr Morgan said: “I was honoured to receive the OBE in 2007 and am disappointed that the MP for Woking should seek its removal.”

Image: Woking Borough Council chief executive Ray Morgan. Screengrab from webcast of Woking Borough Council meeting 11.02.21

Taxpayers will cover the cost of Woking Borough Council’s financial folly after the government agreed to “aid the reduction” of the bankrupt authority’s multi-billion pound debt.

The bail out will initially cover debt owed by the borough in 2026-27 but could be extended if needed.

The pledge is an attempt to prevent Woking from  immediately destroying any new authority it joins as part of the Government’s merger plans for Surrey’s councils.

Woking Borough Council declared itself effectively bankrupt in 2023 when its regeneration plans collapsed leaving it with debts expected to £2.6billion and annual repayments far outstripping what it brings in every year through council tax.

The problem has since spilled into neighbouring councils after the Government selected Surrey and its 11 boroughs and districts to become a newly devolved and  reorganised and merged-mayoral authority.

On April 4, the Ministry of Housing, Communities and Local Government said liabilities should be locally managed by councils.

Since then, the Government has committed to “supporting any new authorities in Surrey with the rationalisation of Woking’s assets, whether through the provision of interim financial support” it said this could be involve “further tranches of financial support for any remaining unsupported debt” until “new authorities are financially sustainable”.

The council would still be expected to continue cutting costs and finding “best value” for taxpayers by selling off its assets – even after the Surrey was reorganised, according to papers published this week. 

Leader of Woking Borough Council, Councillor Ann-Marie Barker, said: “We welcome the government’s statement of intent regarding future financial support. It marks an important step towards addressing our debt position as part of wider discussions on the future structure of local government in Surrey.

“Whilst there is much still to be agreed, this announcement provides a degree of certainty as we continue to work closely with government and other Surrey councils to secure a sustainable financial future for Woking and ensure the best possible outcomes for residents. 

“We are doing all we can to put our house in order by setting a balanced budget and having a strategic plan to sell assets. We remain committed to delivering our Improvement and Recovery Plan to the ensure that we enter any future arrangements in the strongest position possible.”

ENDS

As of April 2025, Epsom and Ewell is actively engaged in Surrey’s significant local government reorganisation, aiming to transition from the existing two-tier system to a unitary authority model.

The UK government initiated a directive for Surrey to be part of the first wave of local government reorganisation, inviting all 12 councils in the county to submit proposals for restructuring. The current two-tier system, comprising Surrey County Council and 11 district and borough councils, including Epsom and Ewell Borough Council, is set to be replaced by unitary authorities responsible for all local services.

Epsom and Ewell Borough Council, led by the Residents Associations of Epsom and Ewell, has expressed a preference for establishing three unitary councils within Surrey. This stance aims to balance efficiency with maintaining strong local connections. Councillor Hannah Dalton, Chair of the Surrey Leaders Group and leader of the Residents’ Association, has emphasized the importance of serving communities effectively and preserving local democracy.

Surrey County Council Leader Tim Oliver advocates for the creation of ‘community-level boards’ to ensure local voices are heard within the new governance structure. These boards would include representatives from various sectors, such as health, police, voluntary groups, and local councils, facilitating tailored public services and stronger community engagement.

While proponents of the reorganisation, such as Surrey County Council, argue that a streamlined unitary model will lead to long-term savings through the reduction of duplicated services and administrative overheads, there are also significant upfront costs involved. These include expenses related to restructuring staff, merging IT systems, rebranding, and establishing new governance frameworks. Early estimates suggest the transition could cost tens of millions of pounds, with potential savings only materialising over several years. Critics warn that these financial pressures could strain local services during the transition period and reduce the funds available for frontline delivery.

The Local Government Information Unit states: “A range of options for potential new unitaries were included from 27 to 67 different unitaries. And, across 18 regions (with the information publicly available), the average population size of options was 544,837. Across the 27 proposals analysed, £38.4m has been set aside for preparing LGR proposals. And, current financial analysis averages the estimated transition cost for each region’s reorganisation as £31.1m.”

A public consultation has been launched to gather feedback from residents and businesses on the proposed reorganisation. This initiative seeks to involve the community in shaping the future governance of Surrey, ensuring that the new structures reflect the needs and preferences of local populations.

• Final Proposal Submission: The final proposals for the new unitary structures are to be submitted to the government by 9 May 2025.
• Government Decision: A decision from the government is expected in the autumn of 2025.
• Elections: Local elections, initially scheduled for May 2025, have been postponed to May 2026 to accommodate the reorganisation process.

Related reports:

Surrey Councils launch Local Government Reorganisation engagement

Surrey’s BIG debt question in local government reorganisation

Local Government Reorganisation in Surrey: Key Proposals

What might local government reorganisation mean for Epsom and Ewell?

Local government reorganisation: What will it mean for Epsom and Ewell?

A private school loaned millions of pounds at favourable rates by bankrupt Woking Borough Council has still to pay its overdue debts – with the local authority saying it is “taking appropriate legal advice” to get its money back. Greenfield School in Old Woking was lent £13.3 million by the now-bust borough, with the previous administration saying the money would help free up capacity within state schools.

Last year, £2.4 million of that was due to be paid back, but the school said it was short of cash and instead offered the council a town centre building it owned in exchange, worth considerably less than that. The council, which is in the process of offloading assets to pay off its own multibillion-pound debt, told the school in November last year that it did not have the capacity to take on any additional buildings.

Four months on, the two parties appear to remain apart on terms, with questions now being asked at Woking Borough Council’s March 20 executive meeting over whether the school will be able to “regularise” its position. Councillor Dale Roberts, lead member for finance, said: “We made it clear that the strong preference of this council was that the school simply met their existing commitments. They are also aware that they are required to provide independent and professional advice on the viability of their plans to repay. Our needs must be front and centre to provide assurance that the school will be able to honour any revised terms and of course that means not just the repayment in November last year but for the whole of the arrangement.”

Cllr Roberts described the loans as “inappropriate” and that the “former administration had no business entering into any such arrangement”. He said: “I’d prefer not to comment on the legalities but I can say with some confidence that it was ultra reckless. The (previous administration) may or may not have acted beyond their legal powers but they certainly sprinted with blind ambition past the boundaries of good judgement.”

According to the papers published by Woking Borough Council, the unsecured loans between 2019 and 2021 helped the school to relocate into another catchment area and enter a different segment of the private education market. Woking Borough Council declared itself effectively bankrupt in 2023 and had to cut services while increasing tax by 10 per cent to help cover its financial meltdown. Greenfield School, which charges up to £17,010 a year, has previously told the council it “may not be in a position” to repay money owed.

Related reports:

No wonder Woking went bankrupt. Scandal of private school loans

Image: Greenfield School Woking (image Google)

Plans for what Surrey could look like in local government reorganisation have been agreed  but questions remain over looming debt. Councillors demanded to know how debt would be managed before the county is divided up.

The government outlined plans for a major reorganisation of local government in December. Two tier councils will be dissolved into unitary authorities which will carry out all local government functions like planning, bin collections as well as education and social care. 

Members of the County Council have agreed on March 18 two proposals for how Surrey could be carved up in the most dramatic reorganisation of local services in 50 years. Serving 1.2m people, Surrey’s current matrix – consisting of 12 borough and district councils and one county council – could be split into two or three new local authorities. 

Leader of Surrey County Council, Tim Oliver, said he believes reorganisation is the “opportunity to turbo charge localism”. He said: “Single councils are clearer for residents, have greater accountability, are more efficient and effective for delivery and strip out unnecessary bureaucracy and duplication.”

Option 1, and the Conservative-run cabinet’s preference, is to cut Surrey in half to create an east and west, or north and south. Exactly which councils will be included in the new authority are still yet to be determined, for instance whether Spelthorne borough is either on the east or west side.

Option 2, put forward by the majority of district and borough councils, consists of three new local authorities in the form of north-west, south-west and south-east Surrey. Again, full details of which councils would be included is still in the draft stages. 

The two outline plans will be submitted to the central government on Friday March 21, who will ultimately have the deciding power on the new face of Surrey. Meanwhile, the local authorities will keep working to produce a final proposal by May 9.

With over £5.5bn worth of crushing debt across the county, members publicly urged the government to solve Surrey’s financial issues before reorganisation. Cllr Catherine Powell said there needs to be “a clear path on the £5.5bn of debt” as it could create “significant imbalances” leading one council “more likely to fail”. The Residents’ Association and Independent Group Leader said she does not feel Surrey can propose new authorities without a solution.

Leader of the Liberal Democrat Group, Cllr Paul Follows, said the councils’ debt is “so toxic it will pollute the rest of this county”. He lamented that reorganisation will not be about what is best for residents but about how money will be spent. 

Speaking to the council, the leader said the government has “made it clear it does not intend to write off all of Woking’s debt”. Cllr Oliver said he will be having detailed conversations and Surrey will “have to come up with plan B”. 

Creating two councils in Surrey could save £27m after five years but three authorities could potentially make a loss of £8m, according to the county council’s report. But the district and borough councils argue three unitary authorities would only save slightly less money than two and not be in a deficit. 

However, Cllr Oliver said they have not taken into account the cost of reorganising services, such as adult social care, which could add substantial added costs. The leader claimed splitting into two is the best value for money for residents.

“There is no desire for Ashford to sink in with Godstone should the boundaries be cut [one] way,” said Cllr Robert Evans OBE. He explained slicing Surrey into two would only reveal some towns would have little in common with villages they may have not even heard of.

Creating two unitary councils with a population of around 600,000 each, opponents slammed the proposal as bad for local democracy and eroding distinctive community identities. Members also flagged there would be significantly less councillors looking after greater areas.

But those batting for a dual council-led Surrey said few residents even identify with the council and local identity would be strengthened by working with community groups and local healthcare networks.

Questions about services like adult social care as well as children and education services were raised as major issues. Cllr Sinead Mooney said splitting the adult social care beyond two units would complicate the service and people could “fall through the gaps”. Cllr Clare Curran highlighted the potential difficulties in retaining and splitting staff to more than two councils, meaning experienced teams could leave. 

Cllr Fiona Davidson called for a need to assess how many children homes, specialist school places and demand for foster children to ensure Surrey is covered with the right services. Members agreed it was not just about making services cheaper and simpler- they had to be run better than currently.

Related reports:

Who will be saddled with Spelthorne’s and Woking’s £3 billion debts?

Could Woking’s debt be shared by you after reorganisation?

What Epsom could do with Woking’s £75 million bail out?

Ex-Council Officers under investigation for Woking’s £2 billion debt

Will Epsom and Ewell be bailing out Woking?

No wonder Woking went bankrupt. Scandal of private school loans

PM confident of success in Woking

Woking’s whopping bail out and tax rise

Surrey County Council is on pace to be hit with more than £1 million in fines and redress payments due to its repeated failures within its education service over the last two years. The council says the system doesn’t work for families, schools, or local authorities – and has lobbied the government for changes, additional funding, and urgent reform.

The “record-breaking” fines, which have climbed from £47,000 in 2020 to more than half a million pounds last year and almost double its previous high of £258,730 in 2023, show the council has “lost control and continues to put vulnerable people at risk,” according to opposition leaders. Now, Surrey County Council has paid £239,510.75 in financial remedies in the first six months of this financial year – putting it on track to hit £470,000 for the full 12 months and a million pounds in the past two years. The majority, £220,965.00, relates to its education services, with the largest individual payments arising from complaints about missed education or missed provision, reports show. These are made when a child is unable to attend school because appropriate or alternative support has not been provided, or where the provision agreed in an Educational Health Care Plan (EHCP) has not been put in place.

The three largest individual remedies paid out so far this year are about £11,000, £8,900, and £8,353 – primarily in recognition of time missed. The largest fine or payment in its Children’s Social Care services so far is £8,325.12, in relation to “errors.”

Clare Curran, Surrey County Council cabinet member for children, families, and lifelong learning, said: “We are working hard to reduce spend on fines, which we know is higher than it should be. Provision and support for children with SEND is a systemic issue that councils up and down the country are grappling with. The national system is not working for families, schools, or councils, and we and other bodies are consistently lobbying the government for wider system changes, additional funding, and urgent reform.”

She said the council had also been working to improve the service with £15m put into a “three-year multi-agency recovery plan” in 2023, which was “now showing clear performance improvements.” Cllr Curran added: “The volume of stage one complaints received in the first six months of this year has decreased compared to the same period in the last two financial years, reflecting the efforts made by services across the council to resolve complaints early on and in the timeliness of responses. We also recognise that delays in issuing Education, Health and Care Plans (EHCP) have historically contributed to missed provision and subsequent fines, however progress is being made in this area too.

“Our average EHCP timeliness levels in Surrey over the six months from September 2024 – February 2025 is 72 per cent, well over the national average of 50.3 per cent. We have also caught up on the backlog of Education, Health and Care needs assessments, and over 75 per cent of overdue annual reviews have now been brought up to date. We expect these improvements to start having an impact on the number of Local Government Ombudsman cases in the near future.

“We are resolute in our ambition to continue to improve services and outcomes for children and young people with additional needs and disabilities so that they are happy, healthy, safe, and confident about their future.”

Councillor Paul Follows, Liberal Democrat group leader at Surrey County Council, said the authority had been promising to fix children’s services for years but has had little to show for it so far. He added: “Surrey County Council have for years been promising families that they would get a grip of children’s services and SEND provision, and as these record-breaking fines indicate, they have lost control and continue to put vulnerable people at risk.”

New Surrey County Council HQ, Woodhatch Place on Cockshot Hill, Reigate. Credit Surrey County Council

The Surrey Borough of Spelthorne’s financial crisis is “even more critical”, with millions in cuts needed to avoid catastrophic bankruptcy, says new report.

Best value inspectors were called in to review the council’s finances in May 2024 in light of extremely high levels of debt and borrowing. Spelthorne’s debt reached £1.096 billion in March 2023 – the second highest level of debt for a district council in England at the time.

The findings of the inspection have been published today (March 17). The report highlights that the council “is in a critical financial position, burdened by unsustainable debt levels, significant investment risks, and systemic governance weaknesses”.

Between 2016 and 2018, Spelthorne Borough Council borrowed around £1 billion to invest in a commercial portfolio of Grade A office buildings and residential land in and around the borough. But slow progress on regeneration and housing projects highlights a limited understanding of regeneration delivery as well as finance and risk, the inspectors said.

Best Value Inspectors concluded: “The council’s use of its resources is inadequate”. In the damning report, they said Spelthorne’s approach to property acquisitions “lacked due regard to long-term planning and risk management” and had an “overly-optimistic reliance on consistency” of the market that the Council first entered. 

The report said: “The combination of voids, expiring leases, and falling income streams from the investment portfolio threatens the stability of its budget. Adding to the strain are the ongoing revenue costs of housing and regeneration projects, which were suspended in late 2023. Despite these mounting financial pressures, no clear path forward has been outlined to address them.”

The recovery process will be overseen by government-appointed commissioners. Minister of State for Local Government and English Devolution, Jim McMahon, wrote to leader Cllr Joanne Sexton to say the local authority is failing in its ‘best value’ duty to residents, essentially meaning the authority is defecting on its ability to make decisions that are economic, efficient and effective and work towards continuous improvement. 

Inspectors said the council has a “poor record” of fully and effectively implementing recommendations from external reviews. The report read: “Senior officers display an optimism bias and a lack of awareness of the true situation facing the council. We do not believe the council has the capacity and capability to make the urgent changes needed without significant external support.”

Both the inspection and the recent external audit found errors in the council’s financial practices including the miscalculating the minimum amount Spelthorne needs to keep paying back its debt, incorrectly classifying expenses as assets, further undermining the revenue budget. 

“The outline budget report for 2025/26 to 2028/29 presented to members on December 9, 2024 shows the need to deliver £8.6 million in savings by 2028/29, equating to 64 per cent of the council’s core spending power for 2024/25, or 33 per cent of the net budget, assuming contributions from commercial income. In our view, even these projections are understated. Despite this, we have seen no credible strategy in place to achieve savings of this level,” said the report.

Leader of Spelthorne Borough Council, Cllr Joanne Sexton, said, “This Group Administration has faced a challenging time and has been actively pursuing the right solution to manage the historical debt that it has inherited. We have met with the Local Government Minister from central government, and we have agreed to work in partnership to take decisive action in the remaining time we have before local government reorganisation is implemented. Our pledge remains that we will always put residents at the heart of everything we do.”

The council’s senior management team also came in for criticism in the report. Inspectors said the team seemed “overly confident” and “appear to underestimate the scale of the financial risks”. Member challenges remain “limited” according to the report, with many councillors not fully understanding the risks at hand. Inspectors highlighted there was a “wider breakdown” of relationships between senior management and the political leadership.

The findings of the inspection highlight the council is failing to meet best value standards in five critical areas:

• Use of Resources;
• Continuous Improvement;
• Governance;
• Leadership;
• Culture. 

Inspectors have published thirteen recommendations for Spelthorne: 

1. Commissioner-led intervention
2. Comprehensive commercial strategy
3.  Review and strengthen asset management
4. Review of the Council’s Minimum Revenue Provision
5. Revised Medium-Term Financial strategy
6. Debt reduction strategy
7. Transformation strategy development
8. Review and strengthen finance function
9. Improvement and recovery plan
10. Revised Corporate Plan
11. Audit Committee structure
12. Culture and relationship building
13. Housing delivery

Emily Dalton

Spelthorne Borough Council offices in Knowle Green, Staines. Credit: Emily Coady-Stemp

Chris Caulfield compares Woking and Spelthorne:

The “critical” state of Spelthorne Borough Council’s finances means it must cut at least £8.6 million from its budget by 2028. To put that into perspective, bankrupt Woking Borough Council made £8.4  million in cuts last year in an effort to right its own mess. It managed it by cutting 20 per cent of its workforce, scrapping all grant funding to community groups, and shutting services such as public toilets.

Spelthorne Borough Council’s finances  are “unsustainable”, with a £1 billion pound debt  and a falling income stream. It means the authority must also cut millions in services to avoid the catastrophe of bankruptcy. The damning critique of the north Surrey council’s sitation was published today, Monday, March 17, on the back of a best value review into the way the borough has been managed.

Spelthorne Borough Council, like Woking, borrowed heavily to invest in property and used the income to pay for services above and beyond what it could have otherwise afforded. And, again like Woking,  it failed to put enough money aside to cover the cost of debt interest repayments.

“In essence, the council’s revenue budget is under far greater pressure than recognised by the council. Inherent risks are beginning to materialise, and could accelerate rapidly”, the Spelthorne Borough Council: Best Value Inspection report read.

It comes as the government confirmed it was proposing an intervention package, including appointing commissioners to oversee changes in how Spelthorne Borough Council is run because the borough lacks experience needed to make the cuts and had “no credible strategy in place to achieve savings of this level.”

Spelthorne has to shed £8.6 million from 2028/29 budget. Last year Woking Borough Council  – the only local authority with a higher per capita debt than Spelthorne – achieved £8.4 million in savings. 

This is how residents and commuinty groups in Woking were affected. It is being used to paint a picture of what cuts at that scale look and feel like

How Woking achieved its savings.

• Centres for the community and day care facilities closed and merged
• Sports pavilions transferred to sports clubs to take over and “ensure as many of these facilities can remain open”.
• Grants to voluntary and community groups stopped
• Woking Community Transport reduced but reviewed annually as part of the council’s Medium-Term Financial Strategy.
• Grounds maintenance and street cleaning services scaled back to statutory levels. 
• Independent living and family services transferred to Surrey County Council or other boroughs, which means they will continue to operate as normal with no impact to services users.
• Business liaison and support services will be scaled back
• All public toilets closed, except those located in Victoria Place and Wolsey Walk in Woking Town Centre.
• Fees and charges increased
• Loss of up to 60 council staff
• Council tax was also increased that year by 10 per cent. Since then it has risen by a further 2.99 per cent.

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Could Woking’s debt be shared by you after reorganisation?

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Will Epsom and Ewell be bailing out Woking?

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Woking’s whopping bail out and tax rise

Residents will face another jump in council tax bills from April 1 as local authorities have announced their budgets for the coming year. Surrey County Council, the Police and Crime Commissioner, and each of the county’s 11 districts and boroughs, confirmed their increases separately last month, with council tax bills and collection being the responsibility of the districts and boroughs.

Police and Crime Commissioner Lisa Townsend confirmed a rise of £14 per year for residents amid an increase in national insurance contributions and officer pay rises. While Surrey County Council, responsible for adult social care as well as services including road repairs and schools, increased its tax by 4.99 per cent on Band D homes.

Meanwhile, many local authorities have had to make tough decisions to balance the books. Councils slammed the government for giving an ‘unkind’ or ‘difficult’ financial settlement, meaning they have had no increase in spending power. Inflation, wage rises and rocketing costs for employer’s national insurance contributions have all pulled at the seams of councils’ pockets.

Table created by Epsom and Ewell Times

Chris Caulfield of the BBC’s Local Democracy Service brings us the latest twist in the awful Woking Borough Council debt crisis. Its £2.1 billion debt accumulated under a Conservative administration from unwise property dealings. The Labour Government is driving forward a reorganisation of Surrey’s local government and there is anxiety that Woking’s debt will be spread to a wider Council tax payer base as a result. Could Epsom and Ewell householders end up paying for the mistakes of Councillors they did not elect?

Even if bankrupt Woking Borough Council sold everything it owned, it would still be more than £1.5 billion in debt. The huge figure was published as part of the ongoing reports Government commissioners must produce on the broken borough as it goes through the painful process of rebalancing its books.

The report stated that while the council, which declared itself bust in 2023 following a disastrous regeneration program that saddled residents with huge tax rises and massive service cuts, was taking steps to sell off its assets, the level of debt was still such that it needed significant government support. Published on March 6, the report revealed that the council had a core spending power of £16.9 million a year – but servicing its £2.1 billion debt was costing £1.3 million a week in interest alone.

“Even if everything else could be disposed of, the level of overhanging debt would still be significant, over £1.5 billion, as the level of debt far exceeds the value of assets,” the report stated. It added that some assets, such as the council’s social housing valued at £400 million, had to be retained. However, if the council did nothing, the annual interest costs and loan servicing would average £70 million and £73 million a year respectively, “which would add significantly to the level of debt.”

The council was granted Exceptional Financial Support for the next two years, allowing it to cover interest and other revenue costs. However, the commissioners warned: “With no ability to repay the exceptional financial support through asset sales, let alone all the legacy debt, the position is not sustainable. Work is underway to determine the best exit strategy from the commercial legacy, which we are engaging with government on, and it is recognised that a long-term financial solution will not be in place for the 2025/26 budget process. However, the current position is not viable, and commissioners are keen to continue engaging with government on the route forward.”

Responding on behalf of the Ministry of Housing, Communities and Local Government, Baroness Taylor of Stevenage acknowledged the bleak situation but stated that the department was reassured Woking Borough Council was committed to radically overhauling its operations. Serious concerns remained over the task ahead and the potential impact on the impending reorganisation of local government – the dissolution of Surrey’s boroughs, districts, and county council, to be replaced with either two or three larger unitary bodies with an elected mayor.

Baroness Taylor wrote: “I share your concerns about the capacity of the council to deliver this programme of change and encourage you to work with the council and the ministry to consider how we can best enable the council to improve, for the benefit of residents. We have been clear with councils in Surrey that commissioners have a vital role, not only in supporting Woking to continue to improve but also in responding to the invitation to all principal authorities in Surrey to provide proposals for local government reorganisation, to ensure that proposals are robust.”

Related reports:

What Epsom could do with Woking’s £75 million bail out?

Ex-Council Officers under investigation for Woking’s £2 billion debt

Will Epsom and Ewell be bailing out Woking?

No wonder Woking went bankrupt. Scandal of private school loans

PM confident of success in Woking

Woking’s whopping bail out and tax rise