Decision details

Cabinet to recommend a balanced budget for 2017-18 to council assembly in February 2017

The report had not been circulated five clear days in advance of the meeting. The chair agreed to accept this item as urgent because the council were committed to publishing budget proposals at the earliest possible opportunity to ensure they are available to the public for comments and questions. Presenting this report to cabinet on 24 January 2017 gives the opportunity for debate prior to presentation of final budget figures to cabinet on 7 February 2017. Under the council’s constitution there is a requirement for the overview and scrutiny committee to review and challenge budget proposals and this is due to take place on 30 January 2017.

RESOLVED:

1.  That it be noted that the provisional settlement was received on 15 December, and is reflected in the revised 2017-18 draft budget presented at Appendix A of the report. 

2.  That it be noted 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 (paragraph 43 of the report )

·  Powers to bring forward the timing of the adult social care precept (paragraph 53 of the report)

·  A one year only Adult Social Care grant of £1.577m for 2017-18 (paragraph 47 of the report), 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 (paragraph 51 of the report)

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

3.  That the risk transfer of retained business rate funding to local authorities (paragraph 39 of the report) be noted.

4.  That the impact on school funding grants, specifically the cessation of the Education Support Grant (paragraph 69 of the report) be noted.

5.  That 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, be noted.

6.  That 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, be noted.

7.  That it be noted that the general fund budget proposals for 2017-18 contained within the report include:

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

·  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 (paragraph 58 of the report)

·  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 (paragraph 87 of the report)

·  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 of the report)

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

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

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

8.  That it be noted that the assumed increase in the Southwark element of the council tax represents the first increase in eight years (paragraph 58 of the report) and it is estimated that Southwark will continue to have the seventh lowest council tax in London.

9.  That it be noted 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 54 of the report).

10.  That the current budget options proposed to help achieve a balanced budget 2017-18 as presented in appendices B-D of the report, including ongoing protection for children’s social care budgets, be noted.

11.  That the departmental narratives setting out the service context and commitments, savings and income generation proposals (Appendix B of the report) be noted.

12.  That the proposed approach to address the children’s and adults’ social care budget pressures, and comparative data (Appendix G of the report), be noted.

13.  That the reducing level of reserves and balances available to the council to help mitigate the risks of funding reductions moving into future financial years (paragraph 84 of the report) be noted.

14.  That the continuing work underway by strategic directors to complete appropriate equality assessments for all budget proposals (reference in Appendix B of the report) be noted.

15.  That it be noted that 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.

16.  That it be noted 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.

17.  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 position for cabinet on 7 February 2017.

18.  That it be noted 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.