Lambeth Council is facing a projected £9.3 million overspend in its first quarter financial performance for 2026/27. This figure, presented to the Cabinet on Wednesday, 23 September 2026, represents a significant challenge, though it is an improvement from the previous month's forecast.

The overspend is attributed to several key pressures, including increased costs for temporary accommodation, income shortfalls within Growth and Environment, and continuing pressures in children's services and adult social care. A substantial £13.4 million overspend within the Dedicated Schools Grant, primarily driven by the High Needs Block, also contributes significantly to the overall deficit.

Councillor Zvikomborero Chihoro, Cabinet Member for Finance and Community Wealth Building, reported on the Quarter 1 Financial Performance Report. During the discussion, councillors raised several points regarding the council's financial management.

Councillor Judith Kavanagh expressed concerns about delayed decisions and asset disposals, specifically highlighting the implications of timetable settings. She noted that the next charge of HRA disposals was ready for decision prior to the re-election, and also raised questions about the Bayer Street Recycling Centre handover.

Councillor Claire Holland sought transparency on council tax assumptions, questioning planned increases by asking, how much are you planning to hike up our council tax by? Decisions on council tax have not yet been made and will be reviewed by the budget working group.

Councillor Chris Nicholson voiced concerns about the asset disposal strategy and its priorities, stating: There's also a wrong sense of priorities on what to spend. We're spending, you are spending more on consultants and then cutting upline services such as the pavement and highway maintenance.

Councillor Matthew Bryant requested clarification on sensitivity analysis for management actions and questioned the realism of the capital programme forecast. He noted that while forecast savings were not included in the report, their inclusion should be baked in. Bryant sought to understand the sensitivity analysis on management actions, particularly regarding staff savings in housing services, asking for an estimation of what is realistically achievable rather than assuming zero or a million pounds.

In response to the financial concerns, Councillor Chihoro stated that the asset disposal strategy would be presented in the Q2 report in November. He also confirmed that decisions on council tax had not yet been made and would be reviewed by the budget working group.

Councillor Jeremy Isaacs provided an update on Central Hill, noting that £50,000 of remedial work was required at the Aspire site, which had not yet commenced. He confirmed that a proposal for Central Hill would be presented on Monday.

Councillor Chihoro apologised for any unanswered questions and assured that responses would be provided via email. Mitigating actions are being taken across directorates to reduce the forecast overspend to within budget by the end of the financial year, although the report notes that there's still a lot to do regarding savings delivery.

The Cabinet ultimately agreed to the eight recommendations outlined in the Quarter 1 Financial Performance Report. These recommendations included considerations for the forecast position of the General Fund and Housing Revenue Account, management actions being implemented, progress on savings delivery, and the utilization of flexible capital receipts.

Public reports pack Wednesday 23 September 2026 17.00 Cabinet