Agenda and minutes

In accordance with the Council’s Constitution, Members are asked to declare any interest they may have in any matter which is to be considered at this meeting.  Members are reminded that the provisions of paragraph 9.3 of Part 5, Chapter 1 of the Constitution in relation to Council Tax arrears applies to agenda item 5.

The minutes of the meeting held on 23 January 2024 were confirmed as correct.

The Cabinet Member for Community Leadership and Engagement introduced the Council’s revenue budget monitoring report for the 2023/24 financial year as of 31 December 2023 (period 9).

The Council’s General Fund revenue budget for 2023/24 was previously set at £199.002m, although the Cabinet Member advised that since period 8 the budget had been updated to £194.46m to reflect the movement of the Capitalised Interest budget of £4.542m to the Central Expenses budget in order to improve transparency of the performance of the Investment and Acquisition Strategy (IAS) budget. 

The forecast outturn position at the end of December projected a net overspend of £9.336m after transfers to and from reserves, which represented an improvement of £1.203m on the position at period 8, and the Cabinet Member commented on the main reasons behind the movement.  The Housing Revenue Account (HRA) continued to show a projected overspend of circa £5.0m for 2023/24. 

Cabinet resolved to:

(i)  Note the projected £9.336m revenue overspend forecast at Period 9 for the General Fund for the 2023/24 financial year, as set out in sections 2 and 3 and Appendix A of the report and note the net projected year end drawdown of £4.73m reserves to support the in-year position;

(ii)  Note the projected £5.005m revenue overspend forecast for the Housing Revenue Account, as set out in section 6 and Appendix A of the report;

(iii)  Note the projected returns for the Investment and Acquisition Strategy as set out in section 4 and Appendix A of the report;

(iv)  Note the movement in Reserve drawdown as indicated in section 5 of the report and that the Cabinet shall be asked to approve the drawdown of reserves to support any overspends at final outturn (post March 2024), subject to finalisation of the actual spend against budget; and

(v)  Note the transfer of the Capitalised Interest budget of £4.542m from General Fund revenue funding to the Central Expenses budget.

The Cabinet Member for Adult Social Care and Health Integration introduced the Council’s proposed budget framework for 2024/25 which incorporated the following:

·  Proposed General Fund revenue budget for 2024/25;

·  Proposed level of Council Tax for 2024/25;

·  Medium Term Financial Strategy (MTFS) 2024/25 to 2026/27;

·  Draft Capital Budget for 2024/25 and revised Capital Programme 2024/25 to 2026/27;

·  Strategy for the Flexible Use of Capital Receipts 2024/25;

·  Chief Financial Officer’s Statutory Finance Report (Section 25 Statement)

The proposed General Fund net budget for 2024/25 was £221.745m, which incorporated a drawdown from reserves of £8.809m to balance the 2024/25 budget after the inclusion of £15.595m of savings and £54.129m of growth from the 2023/24 revised budget.  In order to achieve that budget, it would be necessary for the Council to increase its element of the Council Tax by 4.99%, made up of 2.99% for general spending and 2% that would be ringfenced as an adult social care precept.  The Greater London Authority element of the Council Tax would increase by 8.6%.

The Cabinet Member referred to the steps taken by the Council to achieve a balanced budget for 2024/25 in the context of high inflation, the cost-of-living crisis, increasing pressures and demand for social care services and the continued uncertainty around local government finances.  The Government’s delay in introducing Fair Funding reforms meant that Barking and Dagenham continued to be significantly disadvantaged due to its population increase and high levels of deprivation which were not being properly funded by the Government.

The Cabinet Member commented specifically on the Council’s debt levels which had been highlighted in the press, primarily as a consequence of the problems being experienced at a number of other local authorities, several of whom had issued Section 114 notices in view of their inability to achieve and/or set a balanced budget.  Those local authorities had arrived at that position for various reasons, some due to poor investment decisions, yet the position at Barking and Dagenham was substantially different as its debt had arisen from sound investment decisions to achieve growth in the Borough.  Since 2016, the Council and its subsidiary, Be First, had delivered 1,465 new homes with a further 2,336 under construction and the borrowing that had been secured to deliver that investment was at low interest rates, typically below 2%, and based on a return to the Investment and Acquisition Strategy (IAS) of at least 5% in the longer term.

The Cabinet Member also highlighted a number of other important aspects within the report, which included:

·  The key principles that underpinned the Council’s Medium Term Financial Strategy, as set out under paragraph 4.14 of the report;

·  The key financial risks for both the local government sector as a whole and those specific to Barking and Dagenham, as detailed in section 18 of the report;

·  The key implications of the Local Government Finance Settlement for 2024/25, as set out under paragraph 7.7 of the report, and the continued failure of the Government to provide local authorities with any confidence  ...  view the full minutes text for item 87.

The Cabinet Member for Adult Social Care and Health Integration introduced the Treasury Management Strategy Statement (TMSS) 2024/25 report which set out the Council’s borrowing, investment and funding plans for the year ahead.

The Cabinet Member highlighted the main points within the report, several of which had been considered as part of the Budget Framework 2024/25 discussions, and confirmed that the TMSS 2024/25 would be presented for approval, alongside the Budget Framework 2024/25 report, to the Assembly meeting on 28 February 2024.

Cabinet resolved to recommend the Assembly to:

(i)  Note the current treasury position for 2024/25 and prospects for interest rates, as referred to in sections 4 and 8 of the report;

(ii)  Approve the Annual Investment Strategy 2024/25 outlining the investments that the Council may use for the prudent management of its investment balances, as set out in Appendix 1 to the report;

(iii)  Approve the Council’s Borrowing Strategy 2024/25 to 2026/27, as set out in Appendix 2 to the report;

(iv)  Approve the Capital Prudential and Treasury Indicators 2024/25 to 2026/27, as set out in Appendix 3 to the report;

(v)  Approve the Operational Boundary Limit of £1.9bn and the Authorised Borrowing Limit of £2.0bn for 2024/25, representing the statutory limit determined by the Council pursuant to section 3(1) of the Local Government Act 2003, as referred to in Appendix 3 to the report;

(vi)  Approve the Capital Strategy, including the Capital Programme for 2024/25 to 2026/27, as set out in Appendix 4 to the report;

(vii)  Approve the revised Minimum Revenue Provision Policy Statement for 2024/25, the Council’s policy on repayment of debt, as set out in Appendix 5 to the report;

(viii)  Note that changes made to the Prudential Code and Treasury Management code, published in December 2021, have been fully implemented for the 2024/25 TMSS;

(ix)  Approve the Liability Benchmark data in section 11, including the impact of schemes agreed in 2022 but also the impact of pipeline schemes on the amount of borrowing required by the Council;

(x)  Delegate authority to the Strategic Director, Resources, in consultation with the Cabinet Member for Finance, Growth and Core Services, to proportionally amend the counterparty lending limits agreed within the Treasury Management Strategy Statement to consider the increase in short-term cash held from borrowing;

(xi)  Note the economic, development and operational risks for the IAS schemes as outlined in section 8 and within the IAS and Borrowing reports;

(xii)  Note the Council’s total borrowing is £1.260bn, split into £296m for the HRA, £689m of long-term borrowing and £275m of short-term borrowing;

(xiii)  Approve the CFR projections of £2.022bn for 2024/25, £2.11bn for 2025/26 and £2.02bn for 2026/27; and

(xiv)  Note that the Investment and Acquisitions Strategy shall be updated and presented for approval in April 2024.

Appendix 1 to the report is exempt from publication as it contains commercially confidential information (exempt under paragraph 3, Part 1, Schedule 12A of the Local Government Act 1972 (as amended)).

Further to Minute 10 (16 June 2020), the Cabinet Member for Regeneration and Economic Development presented a report which gave an update on the Council’s Innovative Sites Programme (ISP) and proposed amendments to the original assessment criteria and disposal arrangements.

The Cabinet Member advised on the main objectives of the ISP, which focused on the development of small sites (up to 0.3 hectares) outside of Be First’s main direct delivery programme.   Key principles of the ISP were to provide new innovative and specialist housing which met the needs of vulnerable groups, encouraged community-led / small builder developments and applied innovative housing design / delivery methods.

In light of new legislation that was expected to ban leasehold sales, a new approach to the ISP was required and it was now proposed that properties developed under the ISP be for freehold disposal.  Furthermore, the assessment criteria for disposal bids had been updated to reflect the significant change in the housebuilding industry since 2020 and sites were no longer going to be marketed with planning permission.

The new ISP identified a total of 29 sites for development, split into three workstreams as shown below, with the potential of creating circa 155 new units:

·  Workstream 1 - total allocation of thirteen sites to be systematically disposed of in three phases through the GLA's portal;

·  Workstream 2 - a total allocation of four sites to be disposed in a phased approach across two tranches via the GLA’s small sites portal;

·  Workstream 3 - a total allocation of twelve sites suitable to deliver homes for various vulnerable groups.

Cabinet resolved to:

(i)  Approve the freehold disposal of sites within Workstream 1 of the Innovative Sites Programme, as listed under paragraph 1.14 of the report;

(ii)  Delegate authority to the Strategic Director of Inclusive Growth to approve the inclusion (or exclusion) of sites to the ISP and allocations to the three ISP workstreams, acting on the advice of the Council’s Assets and Capital Board;

(iii)  Delegate authority to the Strategic Director, Inclusive Growth, in consultation with the Cabinet Member for Regeneration and Economic Development, to approve the assessment criteria for schemes put forward by external organisations / groups;

(iv)  Delegate authority to the Strategic Director, Resources, acting on the advice of the Assets and Capital Board, to approve final land values and disposals; and

(v)  Delegate authority to the Head of Legal, in consultation with the Strategic Director, Inclusive Growth, to execute all the legal agreements, contracts, and other documents on behalf of the Council in order to implement the proposals.

Further to Minute 80 (23 January 2024), the Cabinet Member for Regeneration and Economic Development introduced a report on proposals to progress the disposal of a further 558 new homes built at the Padnall Lake Phase 2, Gascoigne East Phase 3A Block I and Gascoigne West Phase 2 redevelopment projects.

The Cabinet Member advised that, as with previous reports, the properties would be disposed of by way of long leases and associated loans to the Barking and Dagenham Reside Regeneration Ltd (Reside) structure of companies following practical completion over the coming months. 

Cabinet resolved to:

(i)  Approve, in principle, the disposal of the New Build schemes below by the granting of long leases to the to the appropriate Reside entity identified in the report;

Padnall Lake Phase 2

-  1-26 Feldwick Road, Chadwell Heath, Romford, RM6 5BF

-  Flat 1-44 Newcombe House, Feldwick Road, Chadwell Heath, Romford, RM6 5BG

Gascoigne East Phase 3A Block I

-  Trilene House, Bowline Street, Barking

Gascoigne West Phase 2

-  Chand House, St Pauls Road, Barking, IG11 7AU

-  Plaice House, St Pauls Road, Barking, IG11 7AN

-  Trawler House, St Pauls Road, Barking, IG11 7QH

-  9, 11, 13, 15, 17, 19, 21, 23, 25 and 27 St Pauls Road, Barking, IG11 7DT

-  Fishmonger House, Healey Street, Barking, IG11 7HJ

-  Gilderson House, Healey Street, Barking, IG11 7EW

-  1-12 Healey Street, Barking, IG11 7ET

-  1-4 Sole Walk, Barking, IG11 7HE

-  32, 34, 36, 38 and 40 Gascoigne Road, Barking, IG11 7LG

(ii)  Approve, in principle, the indicative draft Heads of Terms for leases and loans for Padnall Lake Phase 2, Gascoigne East Phase 3A Block I and Gascoigne West Phase 2 to the appropriate Reside entity, as set out in section 2 of the report;

(iii)  Delegate authority to the Strategic Director, Resources, in consultation with the Strategic Director, Inclusive Growth, to agree and finalise the terms of the loans, leases and any other associated documents, and to take any steps necessary to ensure compliance with s123 of the Local Government Act 1972 and the Subsidy Control Act 2022 provided that such action does not materially affect the approvals granted by Cabinet; and

(iv)  Delegate authority to the Head of Legal, in consultation with the Strategic Director, Inclusive Growth, to execute all the legal agreements, contracts, and other documents on behalf of the Council in order to implement the arrangements.

The Cabinet Member for Community Leadership and Engagement presented a report on a successful application for grant funding to support a major conservation project at Valence House Museum and Archives.

The funding would facilitate key improvements to buildings and grounds at Valence House, incorporating the Museum and adjacent Archives, the Visitor Centre and surrounding green spaces.  In addition to securing a total of £881,250 from the Arts Council of England, the Culture and Heritage service had also secured a further £150,000 in grant and identified a further £175,000 from the Council’s current Capital Programme to fund the approved project.  The Cabinet Member explained, however, that additional fundraising and new income opportunities would need to be generated over the next five years to fully achieve the Council’s longer-term aspirations for community-focused arts and heritage services.

Cabinet colleagues spoke in support of the project and expressed their thanks to officers within the Culture and Heritage service for their continued commitment to enhancing the cultural and local history offer for local residents and others to celebrate and enjoy.

Cabinet resolved to:

(i)  Approve the inclusion of the Valence House Museum and Borough Archive Conservation project in the Capital Programme in the sum of £1,206,250, made up of Arts Council of England grant totalling £881,250, UK Shared Prosperity capital grant of £150,000 and £175,000 from the Council’s Parks Commissioning capital budget for lakes and watercourses;

(ii)  Note the planned trajectory for the delivery of the project, as set out in the report; and delegate authority to the Strategic Director, Inclusive Growth, in consultation with the Head of Legal, to enter into all necessary agreements with the Arts Council to fully implement and effect the proposals; and

(iii)  Note that further significant fundraising will be required in the next 2-5 years to meet the Council’s statutory responsibilities for its listed heritage sites and the accredited Borough Archives.

The Cabinet Member for Community Leadership and Engagement introduced a report on proposals for the procurement of a new, maximum four-year Social Infrastructure contract to support the on-going, effective engagement between the Council and the voluntary and community sector (VCSE), the various partner organisation within the VCSE and local residents, with the combined aim of working together to tackle the most pressing local issues.

The Cabinet Member advised that despite the significant financial pressure faced by the Council, it was fully recognised that continued funding should be allocated to the Social Infrastructure contract to support the vital role that the VCSE played in the Borough and the strength of the relationship between the Council and the VCSE.  The BD_Collective were commissioned to provide the original social infrastructure support service and had been responsible for introducing a range of new initiatives and networks that had proved invaluable in supporting the local community throughout, especially during the Covid-19 pandemic and the continuing cost-of-living crisis.  The successful tenderer would be expected to build on those foundations and continue to attract external funding to support local projects and programmes.

Cabinet resolved to:

(i)  Agree that the Council proceeds with the procurement of a contract for a Social Infrastructure support service, in accordance with the strategy set out in the report; and

(ii)  Delegate authority to the Chief Executive, in consultation with the Cabinet Member for Community Leadership and Engagement, the Strategic Director, Resources and the Head of Legal, to conduct the procurement and award and enter into the contract and all other necessary or ancillary agreements to fully implement and effect the proposals.

The Leader introduced a report on proposals to procure a new, maximum four-year contract for Internet Proxy and Virtual Private Network (VPN) services commencing 1 August 2024.

Cabinet resolved to:

(i)  Agree that the Council proceeds with the procurement of a contract for an Internet Proxy and VPN Supplier via the CCS RM6100 – Technology 3 Framework Lot 3a – End User Services Framework, in accordance with the strategy set out in the report; and

(ii)  Delegate authority to the Strategic Director, Resources, in consultation with Cabinet Member for Finance, Growth and Core Services and the Head of Legal, to conduct the procurement and award and enter into the contract and all other necessary or ancillary agreements to fully implement and effect the proposals.

The Leader introduced a report on the Council’s Pay Policy Statement for 2024/25, which the Council was required to agree annually in accordance with the Localism Act 2011.

The Leader referred to the various elements that made up the Pay Policy Statement and the prudent approach taken by the Council in respect of the remuneration of its senior management in view of the significant financial pressures that it faced.

Cabinet resolved to recommend the Assembly to approve the Pay Policy Statement for the London Borough of Barking and Dagenham for 2024/25 as set out at Appendix A to the report, for publication on the Council’s website with effect from April 2024.