Hillingdon has been bailed out with a £25 million government grant following claims it could go
bankrupt. The Council accepted the grant from the Department for Education after its schools’ budget raised fears of bankruptcy on the Labour benches.
The council’s request for a government bailout came after it overspent on schools’ funding due to a
larger-than-expected number of pupils with special educational needs in the borough. Hillingdon’s
deficit stands at £38 million, larger than the council’s total reserves, meaning they would not be able to pay it back straight away should they have to.
The government will give Hillingdon Council £11 million before the end of the current financial year in April, with the remaining £14 million to be spread evenly over the next four years. Hillingdon Council will have to pay £4 million per year over the next five years to fund their part of the deficit.
The government bailout will plug just over half of the projected £45 million schools deficit the council is expected to rack up by the start of the financial year 2025/26. A condition of the government grant says that Hillingdon Council will have to find the remaining £20 million itself.
Hillingdon Labour’s Finance Lead Tony Eginton said: “Although we are thankful that the Safety Valve Agreements has been obtained, the fact is that this will affect our residents by additional costs on the £20mn which the Council has been forced to offer.”
