Decision details

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

This report had not been circulated five clear days in advance of the meeting. The chair agreed to accept the report as urgent as the council were committed to publishing budget proposals at the earliest possible opportunity to ensure they were available to the public for comments and questions. Presenting the report to cabinet on 12 December 2017,  enabled the opportunity for debate prior to presentation of budget figures to cabinet on 23 January 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 2018.

RESOLVED:

1.  That it be noted that the government’s budget statement was presented by the Chancellor of the Exchequer on 22 November, key headlines being set out in the report, including the government’s agreement for a London Wide Business Rate pool (paragraphs 105 to 112 of the report).

2.  That it be noted, as reported to cabinet in July 2017 and recognising the continued uncertainty for local government funding, that the intention remains for the council to prepare a balanced one year 2018-19 budget for approval by cabinet in advance of council assembly in February 2018 (paragraph 21 of the report).

3.  That the current budget options proposed to help achieve a balanced budget 2018-19 (Appendices C to F of the report) be noted.

4.  That it be noted that this budget also 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 (ASC) (Paragraph 48 to 49 of the report).

5.  That it be noted that the current budget options proposed include an increase in the children’s and adults’ services budgets of £17.2m (funded in part by £12.584m Better Care Fund and £2.7m increase in the ASC precept) which is fully passported to adult social care.

6.  That it be noted that the general fund budget proposals for 2018-19 contained within this report also include:

·  Estimated grant resources likely to be available arising from the provisional settlement expected in mid December (Appendix A of the report, a reduction of some £12.0m from 2017-18 (excluding Better Care Fund)

·  Improved Better CareFund resources totalling £12.584m (including the supplementary allocation of £4.497m announced in the  spring 2016 budget)

·  Further resources from the adult social care precept of £2.7m, again passported in full to adult social care for 2018-19

·  Retained business rates growth of £17.173m (paragraph 55 to 60), an increase of £8.473m over 2017-18 arising from proceeds generated by continued regeneration in the borough; plus an estimated surplus brought forward of £2.987m

·  Estimated council tax revenue of £101.5m (of which £2.7m is represented by the additional ASC precept); estimated collection fund surplus of £5.750m in part attributable to a review of the provision for bad debt

·  Planned contingency to be maintained at a level of £4m to mitigate underlying budget risks. (paragraph 95 of the report).

7.  That it be noted the following savings, commitments and pay and price pressures have been proposed to help ensure the delivery of a balanced budget in 2018-19 (Appendices C – F of the report):

·  Efficiency savings of £11.522m

·  Income generation of £6.806m

·  Savings impacting on services of £0.399m

·  Commitments of £31.171m

·  Pay Awards (assumed 2%) of £4m

·  Contractual inflation of £3.5m.

8.  That it be noted that in order to ensure that the base budget is on a secure financial footing, a number of commitments are proposed for 2018-19 totalling £31.171m, including:

·  £19.426m for ASC which are funded in the main from the £12.584m from the Better Care Fund and £2.700m through the Adult Social Care Precept

·  £5.833m for children’s social care and education services

·  £0.715m to further support spending pressures on No Recourse to Public Funds (NRPF) and temporary accommodation

·  £2.202m for corporate facilities management and ICT in support of the council’s modernisation agenda.

9.  That it be noted that the current pay offer of 2% for local government employees has been incorporated into these budget options, however there is continued uncertainty regarding pay negotiations that will need to  be further reviewed by cabinet in advance of setting the 2018-19 budget.

10.  That theupdated budget gap for 2018-19 of £5.597m be noted and that officers will complete further work to present a fully balanced budget position for cabinet on 23 January 2018.

11.  That the departmental narratives (Appendix B of the report) and the equality analyses provided for the budget proposals be noted.

12.  That the consultation that took place prior to agreeing the indicative budget options for 2017-18 and 2018-19 be noted and that further consultation will be undertaken for new budget options where necessary or appropriate (paragraph 96 of the report).

13.  That it be noted that the further report to cabinet on 23 January 2018 will be considered by overview and scrutiny committee on 30 January 2018 and that any recommendations arising will be incorporated into the final report to cabinet on 6 February 2018 for recommendation to council assembly on 21 February 2018 (paragraph 98 of the report).

14.  That the proposals regarding pooling of London Business Rates (paragraphs 105 to 112) be noted and that the following, based on advice received from London Councils’ legal advisers in respect of these pooling arrangements be agreed: 

  (i)  Establishment of Governance Arrangements: it be resolved to:

·  approve and accept the designation by the Secretary of State as an authority within the London Business Rates Pilot Pool pursuant to 34(7)(1) of Schedule 7B Local Government Finance Act 1988

·  note that the council intends to participate in the London Business Rates Pilot Pool with effect from 1 April 2018 [to 31 March 2019]

·  delegate the authority's administrative functions as a billing authority pursuant to the Non-Domestic Rating (Rates Retention) Regulations 2013 to the City of London Corporation  acting as the Lead Authority

·  authorise the Lead Authority to sub-contract certain ancillary administrative functions to the GLA with regard to the financial transactions (payment of tariffs and top-ups) within the Pool, as the Lead Authority considers expedient.

  (ii)  Entry into the Memorandum of Understanding: it be resolved:

·  delegate authority to the section 151 officer  in consultation with the cabinet member for finance, modernisation and performance to agree the operational details of the pooling arrangements with the participating authorities;

·  authorise the section 151 officer, in consultation with the director of law and democracy, to make any amendments as may be required by the Secretary of State, and to enter into the final Memorandum of Understanding on behalf of the authority.

  (iii)  Operation of the Pool: it be resolved:

·  toauthorise the Leader, in consultation with the cabinet member for finance, modernisation and performance and the section 151 officer, to represent the authority in relation to consultations regarding the London Business Rates Pilot Pool consultative as may be undertaken by the Lead Authority pursuant to the Memorandum of Understanding

·  to delegate to the cabinet member for finance, modernisation and performance the authority to consider such consultative reports as the lead authority may circulate and to respond on behalf of the authority with regard to any recommendations and in particular, proposals for projects to be approved for funding from the strategic investment pot.