Oadby and Wigston: Council set to increase charges to stay afloat

Oadby and Wigston Borough Council says urgent action is needed

A council has warned it will need to increase charges and cut services to avoid effective bankruptcy.

In a report, Oadby and Wigston Borough Council said it had been operating on a "financially unsustainable basis" and "urgent action" was needed to save it.

It said if savings were not made, it would run out of cash in the 2025-26 financial year.

Increases to parking charges and rent rises are among proposals being considered.

At a full meeting on Tuesday, council officers said costs for the current and next financial year had soared beyond previous predictions.

In February, it was estimated that the costs for 2024-25 would be £269,000 but that had risen to almost £1.27m.

For the 2025-26 financial year, it has soared from about £2.65m to £6.88m.

Officers have blamed the higher-than-expected costs on inflation, which has led to bigger pay rises for staff plus increased fuel and energy costs.

They said demands on council services had also increased, particularly homelessness support.

'Painful reality'

The report stated the Liberal Democrat-run council had been relying on reserves to balance the books in recent years, and at the end of March 2024 it was expecting to have about £1.66m left.

Council leader, Samia Haq, said the latest measures "are the only options open to us at this point and this is a painful reality for our councillors".

"Raising extra income, changing the way we deliver services and increasing council tax are the only options open to us at this point and this is a painful reality for our councillors," she said.

"However, we must survive and protect our key services, which our officers strive to deliver with passion and dedication day in and day out. To do this, difficult decisions have to be made."

Officers added: "The council has, low and depleting reserves.

"They are now at their lowest level, and they cannot continue to be used to balance the budget.

"Requiring the use of reserve in balancing the budget demonstrates the council is not financially sustainable as its expenditure is exceeding its funding.

"Urgent action is needed to move the council to a financially sustainable position."

Samia Haq said the council wanted to avoid filing a section 114 notice - effectively declaring bankruptcy

Proposed ideas put forward by the authority's finance team includes a further increase to car park charges after prices were put up in January.

Bin collections could move to a fortnightly rota, while green waste charges could also increase.

Rents are also expected to be increased by 7.7% in April, but this will depend on what the government cap on rises is set at.

The council has also proposed to cull a number of vacant positions from its staffing, and its contract with local charity Helping Hands - which provides a free advice service on welfare benefits, debts, housing, employment and family law - could be cut with resident support moved in-house.

Future council projects - including resurfacing of Fludes Lane in Oadby, the new road at Aylestone Lane allotments, in Wigston, improvements to Wigston Road allotments, in Oadby, and the planned improvements to Willow Park, Wigston - could all be put on hold to save money.