Issue - meetings

Assembly received this report presented by Councillor Gill, the Cabinet Member for Finance, which set out the:

•  Medium Term Financial Strategy (MTFS) for 2014/15 to 2017/18;

•  Proposed General Fund budget for 2014/15;

•  Proposed level of Council Tax for 2014/15;

•  Financial outlook for 2015/16 onwards;

•  Three year draft capital investment programme.

The Cabinet Member announced that the key messages from this budget were:

·  Council Tax freeze for the sixth year in a row

·  Protection of front line services as much as possible and a budget that listened to residents

·  An ambitious capital programme investing in the future of the Borough

and that in setting the budget, the emphasis throughout had been, as far as possible, on protecting front line services and, in particular, prioritising the retention of those services most important to the residents and the future of Barking & Dagenham. 

Despite the financial challenges, the Council had taken the lead in supporting its lowest paid staff, many of whom are local residents, by introducing a £9 per hour minimum wage, and for the sixth consecutive year, as a further means of helping local residents, the Council would again be freezing Council Tax.  However, the Council's success in achieving the highest number of new homes built had resulted in the receipt of additional grant monies, and additional income would also be achieved through increasing the Council Tax base as a result of these new homes.

The budget had been set in the context of further large cuts in core funding from central government and the Council remains underfunded by approximately £2.5 million, due to the way in which central government calculates the funding formula.

The Cabinet Member went on to say that savings in support functions and corporate costs continued to be a priority for the Council, and this was reflected in sharing a Strategy and Policy Team with Thurrock Council, the joint venture with Elevate and by reducing the number of buildings used by the Council for the delivery of services.

The Council would continue to make significant capital investment in the Borough with over £300m of expenditure planned over the next three years.  However, it was important to note that these decisions had not been made without considering their affordability and leaving the Council with unaffordable financing costs to pay in the future.

Significant work has been done at both Member and officer level to lobby central government for more resources and this has been hugely successful and wherever possible, external funding was sought and bidding for additional monies encouraged at every opportunity.

The Council’s asset register is regularly reviewed to identify any surplus items which can then be sold for a fair price in order to reduce the authority’s level of debt and in addition to Council resources, innovative solutions had been implemented such as the use of private sector finance to build 477 new homes at King William Street Quarter and Eastern End Thames View, many of which had now been let with  ...  view the full minutes text for item 51

The Cabinet Member for Finance introduced the Council’s proposed budget framework for 2014/15 which incorporated the following:

·  The Medium Term Financial Strategy (MTFS) for 2014/15 to 2017/18

·  The General Fund budget for 2014/15

·  The level of Council Tax for 2014/15

·  The financial outlook for 2015/16 onwards

·  The Capital Programme for 2013/14 to 2015/16

The proposed General Fund net budget for 2014/15 was £165.3m, compared to a revised net budget for 2013/14 of £178.3m.  The Cabinet Member advised that a range of budget savings for 2013/14 and 2014/15 had been approved by the Cabinet on 19 December 2012 (Minute 64) in anticipation of continued Government cuts in public service expenditure.  As a consequence and following confirmation by the Department for Communities and Local Government of the grant allocation for 2014/15, there was an overall budget gap of £1.1m for 2014/15 which, it was proposed, would be met from a one-off contribution from reserves.  A Capital Programme of £250.2m for 2014/15 and 2015/16 was proposed, which included £134m for HRA-related schemes.

The Cabinet Member commented that the prudent approach that had been taken meant that it was possible for the Council to keep its Council Tax at the same level for the sixth consecutive year, as a means of helping local residents during these difficult times.  However, further savings in excess of £70m would need to be found over the next few years against the backdrop of increasing pressures such as the Care Bill which was currently progressing through Parliament.  The Cabinet Member confirmed that detailed reports on children and adult care funding would be presented to future meetings of the Cabinet.

Issues which arose during the discussions included:

·  Children’s placement costs - the Cabinet Member for Children’s Services referred to improvements to the referral processes that were being discussed with the Police and the vital role of the Borough’s Children’s Centres in improving outcomes for families, particularly through early intervention.  It was noted that while early intervention was considered crucial from both a moral and financial perspective, the non-statutory nature of much of this work would have to be balanced against the pressures arising from other statutory functions;

·  Section 106 Funding - it was noted that the projected reduction in future years’ revenue was partly due to the new Community Infrastructure Levy arrangements which would typically replace Section 106 agreements as the principal source of funding relating to new planning applications;

·  Reduction in the GLA precept - the Mayor of London’s budget for 2014/15 meant a reduction in the GLA precept of 1.3%, which equated to a reduction of £4 per year for Barking and Dagenham residents.  The Cabinet Member for Housing suggested that the Mayor’s budget should have reduced further now that the ‘top up’ funding to support the 2012 Olympics was no longer required and he also questioned the use of public money to subsidise the sale of the Olympic Park.  It was noted that the Crossrail project could be one reason for the minimal reduction in the GLA  ...  view the full minutes text for item 96