It is not a comfortable subject, but every Havering business should understand the council’s financial position. It shapes everything from licensing fees and parking charges to how quickly invoices are paid and which services are cut.

The position in plain English

For the third year running, Havering could set a legal budget for 2026/27 only with Exceptional Financial Support from government: in effect, permission to borrow to cover day-to-day spending. The council’s budget papers put the 2026/27 gap at about £66 million, rising to £77 million in a worst case, with provisional support of £77 million agreed.

The council’s chief finance officer has warned that the medium-term plan is not sustainable without further support, forecasting gaps of £80 million to £90 million a year to 2028/29. Debt built up through this support could reach about £300 million by 2028/29, with financing costs of around £28 million a year. The main pressures are housing demand, children’s services and adult social care. Council tax rose 4.99% this year.

The council argues it is a low-cost authority that has been underfunded for years. Critics in the chamber want a clearer plan to close the gap and repay the borrowing. Both points are on the public record. What matters for business is the practical effect.

What it means for businesses

• Fees and charges. Expect continued pressure on discretionary fees: parking, licensing, trade waste, commercial room hire. Budget for increases rather than hoping for freezes.
• Fewer discretionary programmes. Business grants and support funded from the council’s own pocket are unlikely. Most help now comes from government or the Mayor (see Article 10).
• More use of partners. A stretched council leans on partnerships: business improvement districts, the Chamber, the Federation of Small Businesses, housing associations and developers. That gives organised business groups more influence, not less.

A bigger prize: Budget changes to business rates

The 28 October Budget moves towards councils and mayors keeping more business rates, with 100% local retention targeted by 2030. If that happens, the council’s income becomes more directly tied to the health of local businesses. A thriving business base is no longer just good for the borough; it becomes central to the council’s finances.

Selling to the council

A council under pressure still buys a great deal, from care and maintenance to IT, catering, events and professional services. Its Social Value Strategy commits to supply-chain opportunities for local small and medium-sized firms, and many tenders are marked as suitable for SMEs and voluntary or community organisations.

• Contracts above the legal thresholds are advertised on the government’s Find a Tender service; Havering runs bids through its online supplier portal.
• Purchases under £100,000 are handled by individual departments, and some lower-value opportunities appear on Supply4London.
• The council publishes a contracts register, so you can see what is due for renewal and who manages it.
• Social value scoring, often around 5% of the marks, rewards local jobs, apprenticeships and community work. Local SMEs are well placed to win on it.

One to watch: local pension investment

The Havering Pension Fund has introduced a local investment ambition for opportunities in Greater London. The Pensions Committee has been consulting on an updated strategy that would let up to 10% of the fund go into local investments. Over time, that could mean pension money backing housing, infrastructure or business space in and around the borough.