Agenda item

The Cabinet Member for Finance and Central Services introduced the Council’s proposed budget framework for 2016/17 which incorporated the following:

·  The Medium Term Financial Strategy (MTFS) for 2016/17 to 2020/21;

·  The General Fund budget for 2016/17;

·  The level of Council Tax for 2016/17;

·  Funding reductions to 2019/20;

·  The financial outlook for 2017/18 onwards;

·  The Capital Programme for 2016/17 to 2020/21.

The proposed General Fund net budget for 2016/17 was £150.314m, compared to the net budget for 2015/16 of £151.444m.  The Cabinet Member explained that the Local Government Finance Settlement (LGFS) for 2016/17 had been slightly better than expected, although the longer-term impact of the Government’s public sector funding cuts meant that significant savings would be required in order to meet a projected £63m budget gap by 2020/21. 

With regard to Council Tax for 2016/17, the Cabinet Member advised that the Assembly would be asked to agree a 1.99% increase to the amount levied by the Council.  Together with a 2% increase for the Adult Social Care precept and an anticipated reduction to the Greater London Authority (GLA) precept, the average Council Tax bill would increase by 43p per week.  In respect of the Adult Social Care precept, the Cabinet Member for Adult Social Care and Health reiterated her objection to the Government’s abdication of its responsibilities to properly fund essential care services for the elderly and vulnerable, adding that the 2% precept would not even cover the additional costs of applying pay increases under the Council’s contracts with social care providers.

The Cabinet Member for Finance and Central Services clarified issues relating to the London Enterprise Panel top-slice for 2016/17 and it was noted that discussions were taking place amongst the four constituent Councils of the East London Waste Authority (ELWA) regarding the efficiency of the organisation and the level of increase to the ELWA levy.  Members also supported that Leader’s view that Government initiatives such as the ‘Bedroom tax’ and ‘Pay to Stay’ in relation to Council housing were a direct attack on hardworking families and individuals.

Cabinet resolved to recommend the Assembly to:

(i)  Approve a base revenue budget for 2016/17 of £150.314m, as detailed in Appendix A to the report;

(ii)  Approve the adjusted Medium Term Financial Strategy (MTFS) position for 2016/17 to 2020/21 allowing for other known pressures and risks at this time, as detailed in Appendix B to the report;

(iii)  Delegate authority to the Strategic Director of Finance and Investment, in consultation with the Cabinet Member for Finance, to finalise any contribution required from reserves in respect of the 2016/17 budget, pending confirmation of levies and further changes to Government grants prior to 1 April 2016;

(iv)  Approve the Statutory Budget Determination for 2016/17 as set out at Appendix C to the report, which reflects an increase of 1.99% on the amount of Council Tax levied by the Council, plus a further 2% increase in relation to the Social Care Precept and the final Council Tax proposed by the Greater London Assembly (6.4%% reduction), as detailed in Appendix D to the report;

(v)  Approve the Council’s draft Capital Programme for 2016/17 to 2020/21 as detailed in Appendix E to the report; and

(vi)  Approve the transfer of the one off collection fund surplus of £3.5m to the corporate redundancy reserve, as set out in section 2.11 of the report.