Trafford’s £12m borrowing move raises fears over future services 2026

Key Points

• Trafford Council is planning to borrow around £12m to plug a widening budget gap for the 2026–27 financial year, despite one of the steepest council tax rises in recent years.​
• Senior leaders say the borrowing is needed to protect statutory services such as adult social care, children’s services and waste collection from deeper cuts.​
• Opposition councillors have criticised the strategy as “short‑term” and warned that higher debt repayments could squeeze frontline services in future years.​
• The council’s draft budget cites rising demand in social care, inflationary pressures on contracts and legacy costs from previous funding shortfalls as key reasons for the gap.​
• Residents face a council tax increase at or close to the Government’s referendum cap, on top of an adult social care precept, while some non‑statutory services still face reductions.​
• Council leaders argue that without both higher council tax and extra borrowing, the authority would risk issuing a Section 114 notice, effectively declaring itself unable to balance the books.​
• Local business groups have raised concerns about the impact of higher charges and reduced services on the borough’s economic competitiveness.​
• The borrowing plan will be debated at a full council meeting, where the administration needs to secure enough votes to approve the budget.​
• Financial watchdogs and sector experts have repeatedly warned that more English councils could become financially unsustainable without reform of local government funding.​
• Residents’ groups are calling for clearer communication on how the £12m will be spent, how long it will take to repay, and what safeguards will prevent similar gaps in future years.​

Trafford (Manchester Mirror) February 17,2026 – Trafford Council is preparing to borrow about £12m to shore up its 2026–27 budget, even as households in the borough face one of the sharpest council tax hikes in recent years, in a move that has sparked concern among opposition councillors, local businesses and residents’ groups.​

Why does Trafford Council say it must borrow £12m?

The council’s draft budget papers, summarised in committee reports, set out a projected shortfall for 2026–27 that cannot be fully covered by increased council tax, Government grants and savings measures already identified. Officials say cost pressures are being driven by rising demand in adult social care and children’s services, higher contract costs linked to inflation, and legacy budget gaps from previous years.​

According to the administration, the £12m borrowing would act as a “bridge” to keep the budget legally balanced while longer‑term savings and service redesigns are implemented. Senior figures argue that without this step, Trafford could be forced into emergency measures such as issuing a Section 114 notice, a formal declaration that a council cannot meet its spending commitments within its resources.​

How high is the council tax rise and what will residents pay?

The draft budget assumes a council tax rise at or close to the maximum level allowed without a local referendum, including an additional adult social care precept on bills. For a typical Band D property, that increase would translate into an above‑inflation rise in annual bills, although the exact figures will depend on final decisions by Trafford Council and other precepting bodies such as the Greater Manchester Combined Authority and the police and fire services.​

Council leaders insist the increase is necessary to maintain core services and to demonstrate financial resilience to Government and external auditors. However, many residents already grappling with higher housing, energy and food costs are likely to see the latest rise as an added strain on household budgets.​

What services does the council say the borrowing will protect?

The administration has repeatedly stressed that statutory services are under acute pressure, particularly in adult social care, support for children with complex needs, and homelessness prevention. By borrowing to plug the immediate gap, the council says it can avoid more drastic cuts in these areas, which could have knock‑on effects on vulnerable residents and the NHS if support packages were withdrawn.​

Other frontline services – such as waste collection, basic highway maintenance and core library provision – are also cited as benefiting from the decision to borrow rather than slash budgets further in a single year. Non‑statutory or discretionary services, including some cultural, leisure and community programmes, may still see reductions or restructures as part of the wider savings plan.​

What are opposition councillors and critics saying?

Opposition councillors in Trafford argue that relying on £12m of borrowing, on top of a steep council tax rise, amounts to “kicking the can down the road” and loading future years with higher interest and repayment costs. They have called for greater transparency over how previous budgets were managed, and whether earlier decisions contributed to the current gap.​

Critics also warn that increased debt servicing could crowd out spending on services in the medium term, leaving less flexibility if further shocks – such as unexpected social care costs or reductions in Government grants – hit the council’s finances. Some councillors are urging a more radical review of spending priorities and management structures instead of what they see as a “borrow and hope” strategy.​

How does this fit into the wider crisis in local government finance?

Trafford’s situation echoes mounting concerns across England about the sustainability of local authority finances, with a number of councils in recent years issuing Section 114 notices or warning of being on the brink. Sector bodies and think tanks have pointed to a combination of rising demand for social care, increasing homelessness, and years of constrained Government funding as key drivers of the pressure.​

Financial commentators note that more councils are turning to short‑term borrowing, asset sales or one‑off reserves to make budgets add up, rather than delivering recurring savings or receiving a reformed, long‑term funding settlement from central Government. Trafford’s proposed £12m borrowing is seen by some as another example of how structural problems in the local government finance system are playing out at borough level.​

What does this mean for Trafford residents and local businesses?

For residents, the immediate impact will be higher council tax bills combined with a mixed picture on services: core statutory provision is likely to be protected, but non‑essential services could be trimmed or reshaped. Households on lower incomes may be able to access support through council tax reduction schemes, but these are already under pressure and often depend on local policy choices.​

Local businesses, particularly small firms on high streets and in neighbourhood centres, often rely on clean, safe public spaces, accessible transport, and local promotion to attract customers. If budget pressures limit investment in these areas, business groups fear it could weaken Trafford’s competitiveness within Greater Manchester and beyond, even as they themselves face higher business rates and operating costs.​

What happens next in the budget process?

The borrowing proposal and overall budget package are due to be debated at a full council meeting ahead of the start of the new financial year. Councillors will have the opportunity to table amendments, propose alternative savings, or challenge the scale of the planned borrowing.​

If the budget is approved, council officers will begin implementing agreed measures, including the borrowing strategy, savings programmes and any changes to service delivery models. External auditors will later assess whether Trafford’s arrangements demonstrate value for money and proper stewardship of public funds.