Croydon Council ends spending ban after £120m bailout

image copyrightCroydon Council
image captionCroydon Council announced last year it wanted to cut staff numbers by 15% - about 410 roles

Croydon Council has ended its ban on non-essential spending following a £120m government bailout.

The Section 114 notice, in place since 11 November, banned all new expenditure except for statutory services for protecting vulnerable people.

On Monday the council produced a "balanced budget", which lifted restrictions.

"There is still a lot of work to be done" Hamida Ali, leader of Croydon Council, said.

Cllr Ali said the council would still need to make savings "to live sustainably and within its means for the long term".

She said: "That means we must continue to keep a tight rein on our finances, keep working closely with the government-appointed improvement panel and deliver our improvement plans."

Section 114 notices are issued when a council cannot achieve a balanced budget.

image copyrightCroydon Partnership
image captionConstruction of the £1.4bn Croydon Westfield shopping project has been repeatedly delayed since it was approved in 2017

The council has been allowed to borrow £120m by the government, to help balance the books for the next two years.

The bailout is conditional on the council proving it can improve its finances and provide the government with regular progress.

The council said the money will help "address funding gaps caused by the demands of tackling the Covid-19 crises, which has already cost Croydon over £46m".

A document seen by the BBC last year said "Croydon's financial pressures are not all related to the pandemic".

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