Folkestone & Hythe District Council Leaves £30m Unspent While Services Decline

Folkestone & Hythe District Council approved over £136 million in planned spending across five financial years from 2020/21 to 2024/25. The stated aim was to deliver tangible improvements across housing, infrastructure, and a wide range of local services.

This ambitious budget was distributed across a broad mix of service areas and strategic initiatives. For example, housing and homelessness prevention efforts were allocated both capital funding to develop new housing stock and revenue funding to support frontline advisory teams assisting vulnerable residents.

Economic development budgets were set aside to support regeneration initiatives, encourage local job creation, and stimulate enterprise activity in Folkestone, Hythe, New Romney, and surrounding areas. These plans were meant to enhance economic resilience and revitalise town centres.

Capital allocations to the Estates & Operations service area were intended to modernise the council’s portfolio of public buildings, upgrade critical street infrastructure, and invest in long-term environmental sustainability projects.

Substantial investment was also planned for the Transformation & Transition team, which was tasked with overhauling legacy IT systems and expanding digital access to council services—part of a broader ambition to modernise internal operations and improve public interaction.

Meanwhile, General Fund allocations supported the daily delivery of core services. These included planning and development control, regulatory enforcement, customer contact, financial management, and other essential administrative functions.

Altogether, this integrated, cross-departmental budgeting strategy was designed to strike a balance between long-term capital investment and the delivery of immediate public services. It was meant to ensure that every part of the council had the resources to respond to local needs while contributing to broader strategic objectives.

But over £30 million of that money was never spent. Not saved. Not reallocated. Just left on the table—while residents faced rising bills, stalled developments, and overstretched services.

This is not austerity imposed by Westminster. This is austerity by default—where services shrink not because of cuts, but because of inaction.

Between 2020/21 and 2024/25, the council approved two main types of budget:

• General Fund: for everyday running of local services—housing advice, planning, street services, customer support
• Capital Programme: for long-term projects—new homes, digital upgrades, regeneration, infrastructure

Approved budgets over five years:

• Capital investment: £56.08 million
• General Fund (services): £80.32 million
• Total spending approved: £136.40 million

Yet according to the council’s own audited accounts, nearly 20% of this funding was never used.

Total General Fund underspend: £4.38 million
Only 94.55% of planned General Fund spending was delivered.

The council’s Capital Programme—the investment fund to improve the district—was the most serious area of underperformance.

Unspent by Department (2020/21–2024/25):

• Estates & Operations (parks, buildings, assets): £6.32 million
• Housing: £6.18 million
• Economic Development: £7.04 million
• Transformation & Transition (modernisation and tech): £3.88 million
• Customer Case & Communities: £2.43 million
• Finance & Support: £738,000

Total capital underspend: £26.03 million
Only 53.58% of planned capital was delivered.

These underspends raise serious questions about leadership, not least because they reflect a pattern of repeated failure to execute on major public commitments. In 2020/21, the council allocated over £2.6 million in capital spending to Estates & Operations to improve public buildings, but just £1.2 million was spent. The following year, Economic Development was granted £3 million for regeneration schemes, yet delivered only £1.4 million—leaving high-profile projects like the Folkestone town centre improvement plan in limbo.

By 2023/24, the pattern had hardened into habit. That year, Transformation & Transition received £1.5 million to modernise outdated IT systems and expand digital services, yet failed to spend even half of it. Key improvements to online service delivery were delayed, and residents continued to struggle with inefficient systems. In 2024/25, £2.8 million was earmarked for new council housing, but only £1.7 million was delivered, leaving desperately needed homes unbuilt.

The timeline shows a consistent inability to turn plans into results. Budgets were set with ambition, but follow-through was persistently poor—raising fundamental concerns about project management, internal capacity, and whether the council can deliver on its own priorities. Year after year, capital plans were drawn up with optimism, only to collapse under feasibility delays, internal bottlenecks, and managerial shortfalls. Estates & Operations—responsible for maintaining council buildings and public spaces—left nearly two-thirds of its budget unused. Housing investment failed to materialise despite urgent need for affordable, energy-efficient homes.

This wasn’t caution. It was paralysis.

Everyday Services Underspent Too

Even regular services—the things residents notice every day—were not immune. From housing advice and planning decisions to street services and customer support, key service departments routinely failed to spend what they were given.

Across the five years from 2020/21 to 2024/25, the council underspent its General Fund by £4.38 million, or 5.45%. But a forensic breakdown shows that only £2.44 million of this shortfall came from the six major service areas:

• Housing: £325,000 unspent despite homelessness pressures

• Finance: £408,000 unspent while budgets grew in complexity

• Estates & Operations: £910,000 unspent as public buildings aged

• Customer Services: £278,000 unspent while complaints increased

• Planning: £236,000 unspent even as developer delays mounted

• Regulatory Services: £279,000 unspent despite rising caseloads

Total from these six departments: £2.44 million

This aligns with the previously calculated total General Fund underspend of £4.38 million, meaning a further £1.94 million in underspends occurred outside these departments—likely within areas such as ICT, HR, Democratic Services, Legal, Strategy, or the Corporate Core. These areas, while less visible to the public, are crucial to the council’s ability to function and deliver on its plans.

The consequences of these underspends weren’t invisible. They were experienced every day: longer wait times, fewer staff, slower responses, and missed opportunities to improve local services.

The council’s own senior management flagged problems repeatedly, with warnings issued in official reports dating back to 2021/22. In July 2022, the Corporate Plan Progress Report noted “ongoing resourcing challenges and slippage on key capital delivery targets.” A year later, in the 2023/24 Q2 Finance Update, officers reported “multiple service areas experiencing delivery constraints due to unfilled posts and limited project management capacity.”

By July 2025, these warnings culminated in the Head of Paid Service Dr Susan Priest telling councillors:

“On balance this report confirms just an adequate level of resource has been made available and resources are being efficiently deployed.”

The word “just” is telling. The council admitted it was operating at bare minimum levels, unable to accelerate or improve core services—despite having money in hand.

Each year, council officers repeated variations of the same message: that resource was allocated but not deployed, that delivery was aspirational but constrained, and that strategic ambitions were being consistently outpaced by operational capacity.

Internal reports across the five years describe:

• Unfilled posts
• Capacity constraints
• Ambitious timelines not grounded in delivery

In 2023/24, for instance, the council’s housing team underspent its service budget while also failing to deploy millions in capital investment. The reason? Staffing shortages and unfilled technical roles.

One observer of local government failure summed it up with painful accuracy:

“Local government doesn’t explode. It withers.”

“The really damaging stuff happens when no-one notices: projects slide off agendas, decisions are nudged down the calendar, urgency is replaced by deferral.”

“In local government failure, there are no sirens, no flames. The lights stay on, but fewer people come to work.”

That’s what’s happening here. No scandal. No crisis. Just promises made on paper—and left undelivered.

Council leaders often say they’re working hard to “bring investment into the district.” But in this case, they had it—and didn’t use it.

If the £30 million unspent had gone into the economy, the impact could have been transformative. Evidence from UK research, including the Office for Budget Responsibility and regional economic development studies, indicates that every £1 of public investment typically generates between £1.10 and £2.80 in local economic activity—depending on the project type and delivery efficiency.

In nearby districts and East Kent infrastructure programmes, investment multipliers of up to £2.84 have been recorded. Applying even a modest 1.5x multiplier to the £30 million underspent by Folkestone & Hythe District Council suggests a potential £45 million loss in local economic output—money that could have circulated through local wages, suppliers, construction firms, and community benefits.

Folkestone & Hythe’s underspending not only slowed down its own delivery—it denied the local economy the stimulus it urgently needed. It could have:

• Upgraded hundreds of local homes
• Boosted planning and enforcement
• Funded regeneration schemes in New Romney, Hythe and Folkestone
• Modernised back-office systems to improve public services

Instead, that money sat unused. And once the year ended, it was gone. The unspent funds did not roll forward. They did not return as additional service delivery. They were simply removed from the economic equation—foregone prosperity at a local level.

Folkestone & Hythe District Council is not bankrupt. It’s not under special measures. It passes balanced budgets. It has cash reserves.

But year after year, it fails to spend the money it allocates itself.

There were no votes to cut services. But they shrank anyway. There were no declarations of failure. But the numbers tell the story.

Residents were told there was no money for more street enforcement, for better housing advice, for faster planning. But the truth is different: the council had the money. It just didn’t use it.

Between 2020 and 2025, the council underspent:

• £26.03 million on capital
• £4.38 million on everyday services

That’s £30.41 million that could have been used to build, improve and support local Businesses & Communities. It wasn’t. And local residents paid the price—not in tax, but in what they didn’t receive.

This is not financial caution. It is operational failure. And it’s time someone noticed.

Have you been affected by any service provision losses, if o contact u in confidence at TheShepwayVoxTeam@proton.me

The Shepway Vox Team

Dissent is NOT a Crime