Lib Dems Reject Labour's Sham Budget Consultation

Lambeth Budget Engagement Survey 2026/27

Liberal Democrat Council Group Response

18 November 2025

The Liberal Democrats welcome the opportunity to make an input into setting priorities for next year’s budget. We also welcome the opportunity for members of the public to voice their views. 

However, we have serious reservations about the design of the consultation. We would question where it stands in relation to the constitutional process of budget-setting in Lambeth, in which residents elect representatives to debate and vote on the Administration’s proposals. This is supported by significantly greater access to information than is available to the public. 

In this response to the consultation, we explain the shortcomings of the process, and we put forward our own priorities for spending, saving and generating income.

The consultation: is the public making an informed choice?

Lambeth Labour’s budget consultation is fundamentally about savings: simply put, cuts. The introductory text, as well as what we know about the Council’s dire financial position, makes it clear that substantial savings must be found. 

However, residents are asked not what they wish to cut, but on what service areas they wish to see money spent. 

Residents may choose three priorities for spending, from a list of 18 headings. This ensures apparent public approval for cuts in 15 service areas. We do not accept that there will be public support for unspecified cuts of such a sweeping nature. 

Respondents cannot make an informed choice without further information on:

• What activities actually sit under each of the 18 headings, which seem to reflect Lambeth Council’s internal structures more than the real-life needs of the community?
• How much expenditure has been cut from each area already? There have been successive packages of cuts under Labour administrations.
• To what extent are these service areas covered by statutory obligations, and to what extent by discretionary expenditure?
• To what extent is each service area dependent on expenditure – could some of them be delivered effectively with policy or process changes?
• What specific cuts are envisaged? While most respondents will prioritise adult social care over libraries, few would prioritise a manager in social care attending a career development course over keeping their local library open. The details matter.

We are concerned that members of the public are being asked to give apparent carte-blanche to cuts in all but three areas, without the information they need to make a well-considered judgement. 

The Budget Process: why does Lambeth Labour keep getting it wrong?

For the last three years Lambeth Labour has put a budget to the Full Council for approval, which has had to be revised mid-year because of overspends. Factors blamed are always the same: Brexit, Russia’s war against Ukraine, rising demand for temporary accommodation and rising demand for adult social care. The fact that these have been blamed for overspends in successive years drives home the obvious point: these pressures are not new. 

Why has Labour not budgeted for them year after year? 

The implication of an in-year overspend – in other words, an inaccurate budget – is that in-year cuts have to be made. That means a cuts programme that doesn’t go through the normal budget process. There is no statement in the round to see the full impact of these cuts, there is no debate in the Council Chamber, and there is no vote by the Council as a whole, only sign-off by the Cabinet. That means there is no opportunity for opposition parties to put forward amendments.

Liberal Democrat priorities

Our priorities reflect a better approach. Instead of using abstract headings that seem to refer to the Council’s team structures, we are concerned with real-world outcomes for you, the residents. 

We’re looking out, before looking in.

That’s why we say that:

• Cuts should not reduce front line delivery staff.
• New income generation should focus on money from commercial sources, not from charging residents more (apart from inflation) nor from charging them for services that are currently free.

In addition, any cuts should:

• Not harm public safety.
• Not make the housing repairs service worse.
• Not reduce the Council’s ability to support the most vulnerable, typically the disabled, elderly or at-risk children.

When it comes to saving money, we have some simple lessons for Lambeth Labour. We believe the Council should:

• Complete the transfer of Homes for Lambeth in-house, as called for by the Kerslake Review in 2022, the Corporate Peer Challenge in 2024, and the auditors in 2025, within six months – the Council currently defines it as a long-term aim
• Return void properties to use – Lambeth’s own voids appeared to be stated as totalling about 800 in October 2024, although precise, current figures are hard to find; there were about 2,000 private empty properties at that point.
• Further de-layer its management structures to maximise both the financial savings and the benefits of improved responsiveness and coordination.
• Take steps to reduce costly legal cases.
• Drop special responsibility allowances for deputy cabinet members, policy leads and deputy committee chairs, as proposed in successive Lib Dem Alternative Budgets.
• Drop Lambeth Labour’s self-promotion, and, except for Remembrance Day, aim to reduce events, commemorations and awards to the essentials, while delivering them at lower cost.

We acknowledge that income generation is a real challenge. However, Lambeth Liberal Democrats believe that, as a start, the Council should:

• Negotiate a tourist levy with local accommodation providers.
• Introduce the Late Night Levy in the most profitable areas.
• Increase significantly its letting of spare spaces, particularly on the top floor of the Civic Centre.

You can see more of our ideas in our Alternative Budget 2025/26, and in our motion on a tourist levy and the Late Night Levy.

Our Conclusions

Lambeth Liberal Democrat Councillors have spent almost four years scrutinising Labour’s spending and service delivery. We know that times are challenging for all local authorities. The ever-growing list of statutory responsibilities for Councils creates structural pressures. The imposition by the Conservative Government in 2016 of social housing rent reductions hit the Housing Revenue Account. And while post-Covid support from the Government to local authorities meant that funding per person was expected to be 14% higher in deprived areas in 2024/25 than in 2019/20 (Institute for Fiscal Studies, 7 June 2024), the Labour Government’s Fairer Funding proposals will mean a significant cut in the grant funding that Lambeth receives from central Government. Initial estimates by London Councils indicate that Lambeth will be hit harder than any other borough in London.

But whatever the national picture, our scrutiny work has shown the scale of Lambeth Labour’s waste. 

Homes for Lambeth costs the Council about £10m per year in running costs, with the total cost – including loans, leasehold buy-backs, and uncompleted projects - currently unknown. Lambeth’s auditors took the rare step of issuing statutory recommendations earlier this year, which included “implement the key recommendation of the Kerslake report of bringing the provision of housing services through Homes for Lambeth back ‘in-house’ and determine the associated financial consequences and the impact on the level of reserves and the MTFS [medium-term financial strategy].”

Lambeth has spent nearly £1.6m on Non-Disclosure Agreements with leaseholders it overcharged, there have been three expensive Court cases and two cases before the Schools Adjudicator lost so far this year, and endless compensation payouts ordered by the Local Government Ombudsman. 

Finally, Lambeth’s mishandled Low Traffic Neighbourhood scheme in West Dulwich means that the Council must pay back £1m in fines it had illegally imposed.

Lambeth Labour’s waste costs residents twice – in higher Council Tax and in poorer services.

We believe the approach set out above would help to turn the tide. The consultation exercise run by Lambeth will simply let it flow, while allowing Labour to pray in aid “consent” from residents who are allowed just three priorities without the transparency necessary to make an informed choice.