A paper published by the council at the beginning of October recommended that it needed to cut its budget by an extra £43m, which brings the total amounts it aims to save to £120m by 2015.
According to the Wandsworth Guardian, Council leader Ravi Govindia said: “Every town hall in Britain is having to play its role in reducing the nation’s debt and deficit levels. We will do this by cutting down on back office costs, selling off vacant buildings, market testing our services, reducing the number of high paid managers and looking at intelligent new ways of generating extra income.”
It looks sensible that in those difficult times, everyone needs to be more careful about its spending. However, not even talking about the fact that many economists would warn about dangers of cuts when economy is already struggling, Wandsworth Council is sitting on an enormous pot of cash. Are savings not made to be used to tackle economic difficulties?
Housing service: more than £200M saving, yet 10% jobs scrapped
Lets take an example with the Housing service. In paper No. 13-577 released on 18 September 2013 before the Housing Committee meeting, the graph on page 4 shows that total reserves for HRA (Housing Revenue Account) start at £210 million, and steadily increase to a high of £1,986 million – more than £100M additional saving per year! – at the end of the 30 year planning period (£745 million in present value terms).
The council tax has little impact on the housing service as most of its revenue comes from the rents paid by the council tenants.
In view of those figures, guess what the Council has decided? That there was an urgent needs to cut 44 jobs! It aims to save a little under £2 millions on a budget above £200M.
On October 3rd, it was proposed before the Finance and Corporate Resources Overview and Scrutiny Committee, to make 10% of the staff redundant (and that fact was kept hidden at the Housing Committee the month earlier).
Front line staff impacted
While the leader of the Council claims to newspapers that they cut in back office costs rather than front line service, this is actually the opposite which is happening : front line staff are being deleted and admin is kept.
Wandsworth currently has the highest level of families housed in B&B type accommodation outside the statutorily prescribed 6 week period in comparison to other inner London local authorities. The team of dedicated Housing Options officers to assess homelessness applications can only manage to issue 60% of their decisions within the 33 days recommended by the Department for Communities and Local Government. There are currently 64 families lodging temporarily in B&B (at a cost of £209.80/week per room), so most of them need to stay longer that the maximum legal period of 6 weeks. The Director of Housing seeks also to scrap all Housing Registration posts, those staff members in charge of pro-actively working to lessen the list of applicants affected by the “bedroom tax” (Welfare Reform Act 2012) inflicted by the government (it is estimated that more 2000 council tenants are affected with the risk of becoming homeless as soon as they can pay the new rent).
With homelessness on the increase and a shortage of 2 bedroom flats in the borough, it is difficult to see how a reduction from 28 to 18, some 60% of front-line staff in Housing services will not have a negative impact. The staff members are already instructed to relocate people somewhere-else, especially along the coast in cities such as Brighton or Portsmouth.
Work to be allocated on a generic basis
Under the new proposal, the management claims that they assign the duties in more generic basis: homelessness and allocation functions will be merged and remaining staff will have to work on multiple duies: assessing and preventing homelessness, offering housing options (a role which is currently provided by a team made up of experienced officers) and, in addition, they will share front line roles.
Wandsworth Council head of resources claimed in the report 13-637 that appropriate staff consultation and communication has taken place; in reality, there was only an informal meeting in September. He also said that all new posts will be subject to evaluation using the Council’s scheme; in reality there is no indication yet of the exact proposals, and some staff members have already been offered new roles.
The Council is granting permission to build more luxury flats to the expense of social housing
On the Peabody scheme approved by the Council, the proposal displayed 200 social-rent units and 20 affordable-rent units. In comparison with the original 353 social units, the new plan showed a reduction of 133 social units. Even including the shared-equity element (58 dwellings), it is still a loss of 74 affordable homes.
On the more recent Ram Brewery scheme approved, only 66 affordable units are planned (10% of the scheme – way below the target for London); all of them will be located in the same building, the closest to the gasholders, and therefore not built until this one is decommissioned (quite clever from the developers!). There is no social housing at all.
The Council ‘s leader was praising, last June, a deal signed in China by Dalian Wanda Group to build a residential tower block of 60 floors with … only 51 affordable units at the base.
Therefore it is very hard to believe that the housing department will be less busy in the future. A Tory councillor said: “we all need to make cut“. Wandsworth Council does not have any plan for social housing (rather the opposite, promoting luxury flats and rich tenants). It is short view and particularly blind at a time where even in parliament the majority parties are worrying about the housing crisis in London.
PS: some suggested that the saving could be used to slash council rents just before next year local election (Cllr Simon Hoggs demonstrated in February that Wandsworth is used to set rent increases at less than half the government guideline in the year before local elections and more than double the guideline in the first year after local elections).