Budget FAQs

We are legally required to consult residents every year before setting a balanced budget.

Harrow, like most councils, faces serious financial pressures and must make difficult decisions about how we fund essential services. This consultation gives you the chance to share your views before the council finalises its 2026/27 budget on the basis of the latest Government funding information, which arrives shortly before Christmas.

Every year, the London Borough of Harrow delivers services to more than 263,000 people. Some are essential and some are what we consider important to help us restore pride in Harrow and deliver our key priorities: 

• A council that puts residents first
• A borough that is clean and safe; and
• A place where those in need are supported. 

Next year’s budget focuses on protecting essential services, supporting vulnerable residents, improving streets and public spaces, and keeping Harrow safe and clean. 

We remain heavily reliant on Council Tax - around 80% of our day-to-day spending is funded this way. In 2026/27, rising demand and inflation mean we face a £17m funding gap.
Government expects councils to raise Council Tax by the maximum allowed: 4.99% (2.99% for general services + 2% adult social care).

We are not seeking permission to go above this level. The increase helps us meet rising demand in:

• Adult social care
• Children’s services
• Temporary accommodation
• Services for vulnerable residents.

But it does not fully cover cost pressures as these pressures significantly outpace both inflation and Government funding.

Reserves act as the council’s savings for emergencies or one-off costs. While we will use some reserves in 2026/27 to balance the budget, reserves cannot replace ongoing funding for services such as adult social care or housing support. Once used, they are gone - and Harrow has one of the lowest levels of reserves compared with other councils.

Councils across England face rising costs and demand, creating a £1bn London-wide funding gap, expected to rise to £4bn within four years. Thirty councils have already requested Government emergency support, including seven London Boroughs. London Councils warns that half of boroughs may require Exceptional Financial Support by 2028.

Thanks to careful management, Harrow is not in that position - however, we still face significant pressures and must make tough decisions. 

The council’s main income sources include:

Council Tax – around 80% of everyday spending.

In 2026/27, this equates to £173m of £215m spent on day-to-day services.

This is one of the highest proportions in London and makes Harrow one of the most Council Tax-dependent boroughs in the capital.

Most London boroughs fund between 25% and 65% of their spending through Council Tax. By contrast, Harrow is one of only three London boroughs where more than four-fifths of the entire budget is funded this way.

Only Harrow (80%), Havering (80%), and Richmond upon Thames (85%) fall into this highest category. Many boroughs — such as Newham (25%), Hackney (27%), Tower Hamlets (31%) and Westminster (35%) — rely far less on Council Tax, reflecting higher levels of Government funding or other income sources.

Business Rates – around 30% of the total collected locally, with approximately £15.5m retained by the council in 2025/26. The remainder is redistributed nationally.

Government grants – most of which are ring-fenced for specific services such as schools, public health or housing and cannot be used to fund general services.

Fees and charges – income from discretionary services such as parking, libraries, leisure, and commercial waste.

The Government will introduce changes to Business Rates and a new three-year finance settlement from 2026/27. We received the details of the Government's Fair Funding Review on 17 December and are still working through what this means for us. Early analysis shows that Harrow will receive around £7.4 million in additional grant funding for 2026/27. This is great news for Harrow, but still leaves us with a budget gap of just under £10 million next year. 

Key investments include:

• £42m programme for road and pothole repairs (year two of three)
• £1m for enhanced street cleansing over two years (year two of two)
• £6m programme for parks and open spaces (year two of three)
• Freezing Garden Waste charges again
• £300k for improved CCTV in town centres and parks
• £900k over three years to upgrade car parks
• Maintaining one-hour free parking in all council-owned car parks and on-street bays
• £8.4m more for Adult Social Care
• £21m to buy homes and reduce homelessness
• £600k for refurbishing unused park buildings into community spaces

These investments reflect resident priorities for safety, clean streets, green spaces, and support for vulnerable people. 

We are delivering savings by:

• Negotiating better contracts
• Improving service efficiency
• Reviewing fees and charges (proposed 4.5% increase in line with inflation)
• Working smarter through technology and process redesign

Savings come primarily from the revenue budget, since capital funding cannot be used for everyday costs. 

Revenue funds day-to-day services (e.g. waste collection, libraries, staffing).

Capital funds long-term investment (e.g. roads, housing, park improvements).

Capital money cannot be used to run everyday services. Even if the council borrows for capital projects, it cannot move that money into the revenue budget. 

This increase aligns with inflation and helps cover rising costs of providing discretionary services.

We have benchmarked fees to ensure fairness and have chosen to freeze some charges - such as Garden Waste - and maintained one-hour free parking.

Increases do not exceed the cost of inflation and help keep services financially sustainable

National and local support is available, including:

• Household Support Fund help for pensioners, families receiving free school meals, care leavers, people with rent arrears, and others
• Local advice services, including Harrow’s Conversation Café
• Cost of Living resources on our website where you can check eligibility and access support online. 

Adult Social Care supports people with physical or learning disabilities, mental illness, or age-related needs.

Demand continues to rise, partly due to Harrow having one of London’s fastest-growing older populations.

#In 2026/27, we will invest an additional £8.4m to support vulnerable adults. 

Rising homelessness and high private rental costs mean more households are presenting for help. Harrow currently spends around £19m per year on temporary accommodation.

To reduce this pressure, the council is investing £21m to purchase properties and increase affordable housing supply, and £12m for temporary accommodation, ensuring safe housing for those in need. 

Your feedback will help shape the final budget, which will be considered by Council in February 2026.

Results will be anonymised and published alongside the final Budget Report on this page in February 2026.

Let us know your views by filling out our Draft Budget Survey on the bottom of the consultation page.