Financial crisis
Wandsworth Council faces a financial crisis. If no action is taken, our local share of Council Tax will need to increase by 230%.
The new administration is undertaking a comprehensive spending review, assessing the difficult choices necessary to reduce the gap.
The outcomes will be announced at the Full Council meeting on 22 July. You will be able to watch the announcement live.
Reasons for the crisis
There are a number of factors contributing to our financial situation.
Government cuts
Wandsworth has been hit hard by national government cuts to its funding. Alongside Council Tax, we rely on this funding to deliver essential local services.
In December the government confirmed we’ll receive £84 million a year less cash by 2030 and be given no extra funding to cover inflation or increasing demand for statutory services.
The grant loss has already started, with Wandsworth receiving £19 million less in 2026/27 than we did the year before. This loss is set to rise significantly each year.
Budget gap
In March the Council set budgets which require the use of £50 million of reserves to balance the current year’s budget. If no action is taken the budget gap would increase to £137 million in 2028/29 and continue to rise each year beyond that.
This is the largest forecast deficit in Wandsworth’s history.
Reserves
Built up over a number of years, the Council has a long tradition of maintaining strong reserve balances which have provided financial security and flexibility to support the services we deliver. They act as a financial safety net, helping the Council manage emergencies, absorb budget pressures and support investment in services.
But reserves are now being used to fund day to day spending at a significant - and increasing - rate, with £50 million needed in 2026/27 alone.
This is unsustainable and, if no action is taken, the Council is projected to have no reserves left by 2028 as they would have been used in full to close the budget gap each year.
Borrowing
Borrowing is used to fund longer term investment in the Council’s assets and infrastructure. In addition to the budget gap, current projections show the Council’s borrowing increasing to £1.14 billion by 2035.
The new administration believes this level of debt plus the interest charged on it is too high, putting too big a financial burden on the Council and, ultimately, future generations of taxpayers.
What will happen next
The government has given Wandsworth the power to increase Council Tax by whatever is needed to balance the budget.
If we choose to do nothing this would need to be 230% by 2030.
The new administration is therefore taking urgent action to address the significant budget gap and reduce the debt burden through a comprehensive spending review. All spending and borrowing plans are being reviewed in detail to find savings and efficiencies whilst protecting the core neighbourhood services that residents rely on and value.
Initial findings of the spending review will be presented to the first council meeting to be held under the new administration.
Full Council meeting
Financial matters will be discussed at the Full Council meeting:
- Date: Wednesday 22 July 2026
- Time: 7.30pm
- Location: Council Chamber at Wandsworth Town Hall
The meeting is open to the public and will be broadcast on the website.
View meeting details.