‘Difficult decisions to come’: Hackney Council boss issues stark warning over £57m deficit

Hackney Council’s interim chief executive Dawn Carter-McDonald. Photograph: Hackney Council

Hackney’s interim chief executive has raised the alarm over a £57m financial black hole in the council’s finances, and warned that it could lead to cuts in services.

Dawn Carter-McDonald was quizzed on a range of issues, including the council’s handling of the Tom Dewey scandal and budget woes, by a scrutiny panel on Tuesday.

She said it would be “wrong not to acknowledge the financial context we’re operating in as a council”.

Faced with a major budget gap of £57m over 2024/25 through to 2026/27, the council would need to make “difficult decisions”, Carter-McDonald warned.

She said: “We closed some of this budget gap as part of setting the budget for next year and we’re currently updating our medium-term financial plan for 2025/26, which goes through to 2028.

“Given this significant increase in demand we are facing, alongside little prospect of increase in funding over the same period, we will be estimating a significant gap, which means we cannot rule out as a council reducing the range of services or reducing the standards we currently provide.”

She said working with partners is key because the council “can’t do everything”.

The council’s thinking needs to be broader but also go into detail in thinking of the “hole we’re trying to plug”, she said.

“We have to think what it is we’re trying to achieve, which very much is making sure that we continue to provide the services that we are required to provide on a statutory basis,” Carter-McDonald added.