Decision details

The report had not been circulated five clear days in advance of the meeting. The chair agreed to accept the item as urgent, because cabinet was required to prepare a budget proposal for submission to council assembly. This meeting was the last cabinet meeting before council assembly on 22 February 2017, and the council is required to set a lawful budget by 11 March 2017.

 

RESOLVED:

 

1.  That the context of the budget as agreed by cabinet on 24 January 2017, where the following recommendations were agreed, be noted:

 

“That cabinet:

 

1.1.   Note that the provisional settlement was received on 15 December, and is reflected in the revised 2017-18 draft budget. 

 

1.2.   Note that the key elements for the council arising from the provisional settlement included:

 

·  Settlement Funding Assessment (SFA), updated to include the confirmed Revenue Support Grant (£57.79m) and Business Rate Baseline Funding levels (£108.21m)

·  Confirmed new homes bonus for 2017-18 of £13.053m representing an overall reduction of £2.0m on 2016-17 budgeted funding levels;

·  Powers to bring forward the timing of the adult social care precept

·  A one year only Adult Social Care grant of £1.577m for 2017-18, funded by the government through a further reduction in new homes bonus

·  Confirmed improved better care fund in 2017-18 of £1.658m m payable directly to the council and indications of increased funding in 2018-19 and 2019-20;

·  Confirmed Public Health Grant for 2017-18 of £28.194m which is a reduction of £0.69m from 2016-17.

 

1.3.   Note the risk transfer of retained business rate funding to local authorities.

 

1.4.   Note the impact on school funding grants, specifically the cessation of the Education Support Grant.

 

1.5.   Note the continued uncertainties especially regarding adult social care and children’s services cost and demand pressures for 2017-18 and beyond and also ongoing funding risks and uncertainties relating particularly to the new Adult Social Care Grant, New Homes Bonus, Public Health Grant and risks of retained Business Rates.

 

1.6.   Note the current budget deficit for 2017-18 of £1.822m, reduced from £2.6m on 13 December 2016, and £8.1m presented on 1 November 2016, after the incorporation of a number of budget proposals and updated information following the provisional settlement.

 

1.7.   Note that the general fund budget proposals for 2017-18 contained within this report include:

 

·  grant resources arising from the provisional settlement on 15 December (Appendix A)

·  Estimated resources for the Autumn Statement Grant

·  An assumed increase in Council Tax of 1.99%, below the cap of 2% laid down by the Department for Communities and Local Government (DCLG);

·  An assumed increase in the Adult Social Care (ASC) precept of 3%, in line with the maximum laid down by DCLG

·  Estimated council tax revenue of £87.5m in line with the Council Tax Base report agreed by cabinet in December

·  Estimated retained business rates growth of £8.7m

·  Planned use of balances of £3.7m, subject to reserves and balances being available

·  Planned contingency of £4m

·  Provision for contractual inflation and 1% pay award

·  Proposals for budget changes in 2017-18:

 

o  new commitments £22.916m, of which £5.9m is ASC earmarking of precept and grant (Appendix C)

o  efficiencies and improved use of resources of £18.247m (Appendix D)

o  income generation proposals of £2.482m (Appendix E)

o  other savings impacting on service delivery of £4.981m (Appendix F)

 

1.8.   Note that the assumed increase in the Southwark element of the council tax represents the first increase in eight years (paragraph 48) and it is estimated that Southwark will continue to have the seventh lowest council tax in London.

 

1.9.   Note that this budget proposes to use the flexibility offered by the government to support social care through an increase in the Adult Social Care precept, equivalent to 3% of council tax, on the basis that these additional funds will be used exclusively for adult social care (paragraph 44).

 

1.10.   Note the currentbudget options proposed to help achieve a balanced budget 2017-18 as presented in appendices B-D; including ongoing protection for Children’s Social Care budgets.

 

1.11.   Note the departmental narratives setting out the service context and commitments, savings and income generation proposals (Appendix B).

 

1.12.   Note the proposed approach to address the Children’s and Adults’ Social care budget pressures, and comparative data. (Appendix G).

 

1.13.   Note the reducing level of reserves and balances available to the council to help mitigate the risks of funding reductions moving into future financial years.

 

1.14.   Note thecontinuing work underway by strategic directors to complete appropriate equality assessments for all budget proposals (reference in Appendix B)

 

1.15.   Note the consultation that took place prior to agreeing the indicative budget options for 2017-18 and 2018-19 in February 2016 and that further consultation will be undertaken for new budget options where necessary or appropriate.

 

1.16.   Note that this report will be considered by overview and scrutiny committee on 30 January 2017 and that any recommendations arising will be incorporated into the final report to cabinet on 7 February 2017.

 

1.17.   Request that officers complete further work in the light of further notifications from government and recommendations from cabinet and overview and scrutiny to present a fully balanced budget positionfor cabinet on 7 February 2017.

 

1.18.   Note that on the basis of this range of uncertainties and as reported to cabinet previously, a balanced one year 2017-18 budget will be presented to cabinet in February for approval in advance of council assembly in February 2017”

 

2.  That it be noted that the 24 January report was considered by overview and scrutiny committee on 30 January 2017, and that the recommendations arising (paragraph 86 of the report) be agreed.

 

3.  That it be noted that as at 1 February 2017 the final settlement has not been received, and that the revised 2017-18 budget presented in Appendix A of the report reflects the provisional settlement, and that any changes will be reported to council assembly. 

 

4.  That it be noted that this report presents the final balanced general fund budget proposals for 2017-18 including:

 

o   new commitments £22.566m, of which £5.9m is ASC earmarking of precept and grant (Appendix C of the report)

o   efficiencies and improved use of resources of £18.897m (Appendix D of the report)

o   income generation proposals of £2.480m (Appendix E of the report)

o   other savings impacting on service delivery of £5.081m (Appendix F of the report).

 

5.  That this balanced one-year 2017-18 budget be submitted to council assembly for approval.

 

6.  That it be noted that the indicative budgets for 2018-19 and 2019-20 agreed by council assembly in February 2016 are under considerable pressure despite the significant proposals in 2017-18, and that it be noted that work will commence early in 2017-18 to update the Fairer Future Medium Term Resources Strategy to address these concerns.

 

7.  That under Part 3C of the constitution full cabinet is responsible for the approval of new fees and charges and agreement of charging levels in line with the medium term resources strategy, and that the fees and charges presented in Appendix H of the report be agreed, and that the level of those fees which cabinet is not permitted to set (paragraphs 88 to 93 of the report) be noted.

 

NOTE: In accordance with overview and scrutiny procedure rule 17.2 (a) (budget and policy framework) decisions 1-6 are not subject to call-in.