Decision details

To note the council’s deliberation for the 2018-19 general fund revenue budget and agree the next step in the budgeting process

RESOLVED:

1.  That the spring government budget announcements be noted, including:

·  Adult Social Care (ASC) supplementary funding for the Improved Better Care Fund of £7.471m in 2017-18, reducing to £4.497m in 2018-19 and £2.223m in 2019-20 (paragraph 18 of the report)

·  A Business Rate Discretionary Support Fund allocated to local authorities for 2017-18 to 2019-20 (paragraph 27 of the report)

·  Increased targeted support for those businesses that lost Small Business Rate Relief entitlement as a result of revaluation 2017 and business rate discount for smaller public houses (paragraph 27 of the report)

·  The allocation of ring-fenced Flexible Homelessness Grant of £2.670m in 2017-18 and £3.165m in 2018-19 to be utilised in prevention of homelessness (paragraph 23 of the report). 

2.  That it be noted that cabinet will receive a report in early autumn regarding the Discretionary Business Rate Relief (paragraph 29 of the report).

3.  That it be noted that it is proposed that a budget is prepared for 2018-19 on a one year basis, recognising the funding uncertainties of the provisional settlement and the enduring budget pressures within children’s and adults’ services (paragraph 17 of the report).

4.  That it be noted that the indicative resources available for 2018-19 budget (Appendix A of the report) indicate a budget gap of between £16.440m and £19.894m (the extent to which the council can fully utilise the additional £3.454m of Improved Better Care Fund impacts on the size of this gap).

5.  That it be noted that this budget gap would reduce by £1.800m should the council decide to increase council tax by 2%.

6.  That it be noted that this indicative budget is prepared on the following national and local factors:

National factors

·  Known reduction of £13.594m in government resources from the Settlement Funding Assessment (SFA) and reduction in specific Grant Funding

·  Inflation and pay award pressures of £6.000m have been provisionally assumed, subject to further analysis.

Local factors

·  Increase of £3.400m of resources generated through council tax and business rates including the utilisation of powers to raise the council tax precept by 3%

·  Retaining a £4.000m contingency within the overall budget to support in year cost pressures

·  No utilisation of reserves have been included

·  An assumption that the budget recovery board is successful in addressing the underlying cost pressures within children’s, adults’ and public health (paragraphs 55 to 59 of the report).

7.  That the key areas of risk for Southwark arising from the provisional settlement reported to cabinet are the ability to fully utilise the improved better care fund, lack of certainty for Business Rate Retention, New Homes Bonus, the levels of reserves, budget pressures arising from children’s and adults’, inflation increases and new commitments (paragraph 63 of the report ) be noted.

8.  That the budget risks within the Dedicated Schools Grant as set out in paragraph 60 of the report be noted.

9.  That it be noted the revenue and capital outturn position and utilisation of reserves will be reported at the cabinet meeting in July. This will be a key factor to consider when finalising the 2018-19 budget (paragraph 51 of the report).

10.  That a future report will consider the indicative savings and commitments for 2018-19 in order to balance the budget. This will include a review of the original indicative 2018-19 savings reported to cabinet in February 2016, 2016-17 outturn position and the impact of the budget recovery board (paragraph 66 of the report).