Swindon Borough Council granted £14.7 million exceptional financial support package

The Government has announced that Swindon has been granted permission to borrow £14.7m to fill their budget black hole.

Back at the start of February in a budget briefing to the press, Swindon Borough Council revealed that their latest accounts showed a forecast £7.6m in-year budget overspend with next year’s budget (2025/26) showing an estimated £18.9m budget gap.

At the time Cllr Kevin Small, Swindon Borough Council’s Cabinet Member for Finance, said: “Swindon is a microcosm of the wider local government sector and the Government is under no illusions about the scale of the issues we are facing.

“The cost and demand for social care services continues to rise, making up around 80 per cent of our budget.

“The Government recognises that system-wide reform of both children’s and adults’ social care is essential if these costs are to become more financially sustainable for local authorities. It has also committed to reforming local authority funding, for example, by introducing multi-year funding settlements from 2026/27 to give local authorities the certainty to plan and invest for the long term.”

But now the local authority has had a much-needed cash injection courtesy of The Government - with last night’s Ministry of Housing, Communities and Local Government announcement that they were amongst 30 councils up and down the country who had been granted an exceptional financial support package worth £14.7m.

Exceptional Financial Support gives councils temporary permission for a financial year to use capital funds raised through borrowing and the sale of assets to plug funding gaps in their day-to-day revenue spending. Any council which is granted this support is subject to an external assurance review.

Reacting to the Government announcement, Cllr Kevin Small said: “We’re pleased that the government has granted us the ability to be more flexible with our finances through this support.

“However, we don’t want this to detract from the work our budget will be doing to fund services and take forward the Swindon Plan to improve the Borough for all residents.

“We will have a £188m revenue budget next year which includes progressing plans to reinvent the town centre and drive economic growth. This is important as the future prosperity of Swindon will also have a positive knock-on impact on the Council’s finances.

“We also plan to invest millions of pounds through our capital programme to further expand SEND provision and improve social housing across Swindon, which will include our historic Railway Village.

“Meanwhile, we have a clear plan for how the Council can transition to a more financially sustainable position over the next four years. In the short term, having greater flexibility in how we use our funding would mean we avoid having to cut services any further and prevent larger increases in council tax bills.

“It gives us the time to fundamentally change how the Council operates going forward. This will see us focus on early intervention and prevention, so that we can work alongside residents to help them live safe, healthy and independent lives for as long as possible.”

One stipulation of the package though is that for the first time, conditions are imposed preventing councils granted EFS help from selling what it calls “community and heritage assets”, reflecting fears that desperate councils could embark on a fire sale of well loved parks, golf courses, regeneration land and artworks.

In total a record 30 English local authorities have been granted effective “bailouts” enabling them to borrow money to avoid bankruptcy. In total it amounts to £1.5bn.

Three councils – Birmingham, Bradford, and Windsor and Maidenhead – will each be allowed to borrow more than £100m this year to stay afloat, while also being allowed to issue cap-busting council tax bill increases of up to 10%.

Six councils who are in special measures after declaring effective bankruptcy in recent years – Birmingham, Croydon, Nottingham, Slough, Thurrock and Woking – have again been granted special financial help.

Swindon is amongst the councils granted special borrowing packages for the first time, as are Newham, Shropshire, Trafford, West Berkshire, Wirral, Enfield, Halton, Barnet, Solihull, Worcestershire and Worthing.