Agenda item

Covering report and five DRAFT reports attached, namely:

·       Havering and Wates Regeneration LLP Business Plan and Budget 2020/2021

·       HRA Budget for 2020/2021 and HRA Major Works Capital Programme 2020/21 – 2024/25

·       2020/21 Capital Programme and Strategy

·       Treasury Management Strategy Statement (TMSS) 2020/21  and Annual Investment Strategy (AIS) 2020/21, Treasury Indicators and Minimum Revenue Provision Policy Statement for 2020/21, and

·       2020/21 Budget and 2020-2024 Medium Term Financial Strategy

The report before members detailed five draft Cabinet reports which were being brought to the Board for its consideration.

The reports would be presented to Cabinet at its meeting on 12 February and then onto the Council meeting on 26 February.

The five Cabinet reports were as follows:

•        Havering and Wates Regeneration Business Plan

•        HRA budget for 2020/21 and HRA Major Works Capital Programme 2020/21 – 2024/25

•        2020/21 Capital programme and Strategy

•        Treasury Management Strategy Statement

•        2020/21 Budget and 2020-24 Medium Term Financial Strategy

Members were advised that due to the General Election held in December 2019 the provisional budget figures had only been received on 20 December and the confirmed figures earlier in the evening of this meeting.

Officers confirmed that they were disappointed to receive only one year’s budget settlement as opposed to a three year provision as this would have assisted with longer term planning.

The main headlines from the settlement were as follows:

•        Overall Settlement Funding Assessment (SFA) increased by inflation

•        A new Social Care Grant announced for the next 4 years (£3.7m for Havering)

•         An option to implement a 2% Adult Social Care Precept (ASC Precept) (£2.5m for Havering)

•        Other Grants such as other social care grants , Improved Better Care Fund, Flexible Homelessness and Independent Living Fund replacement all to continue for another year

•        A cap on General Council Tax increases of 2% (excl ASC Precept)

•        The ending of the 75% pilot London Business Rate pool  for 2020/21

•        New Home Bonus to continue but new payments only guaranteed for one year (Havering did not benefit as it was below the threshold)

•        Small increase in Public Health Grant (still to be confirmed)

The budget consultation for Havering Council was conducted in October and November. Respondents were asked questions regarding the following:

•        The overall budget

•        Savings

•        Income generation proposals for 2020/21

192 responses were received:

Several Members expressed their dis-satisfaction at the low level of responses and questioned whether the Council needed to look at other ways of engaging with residents as the low response what not a true reflection of resident’s views.

The three services that were most important to respondents were Community Safety, care and support for older and disabled people and child protection and safeguarding.

Following the budget consultation new savings totalling £13.6m had been proposed (£7.1m in 2020/21).

Members noted that the Council had announced significant investment to help the borough’s businesses tackle the challenges of changing shopping habits and online competition.

The changes included free Sunday parking in all Council car parks from 1 April 2020. There would also be 30 minutes free parking in all on-street pay and display bays across the borough from the same date. A 20% discount would be introduced on all parking charges paid by borough residents using the new Havering parking app, due to launch on 1 May 2020.

Members noted that it was proposed to increase the Council Tax by 3.95% (1.95% for main Council services plus 2% Adult Social Care precept).

The Council had an ambitious Capital programme to deliver the Regeneration projects, investments in schools and a number other schemes.

In order to deliver this programme, significant new levels of external borrowing would be required. In the medium term the income streams from the Joint Ventures would more than cover the principal and interest costs but initially there will be a net cost.

In October 2019 the Public Works Loan Board (PWLB) had increased the cost of borrowing by 1%. Given the scale of potential borrowing over the next few years this would have a significant impact on borrowing costs.

Members were advised that the 2020 Spending Review would be multi year and would set control totals probably for the remainder of this parliament. Officers were prudently assuming a number of specific grants would end and be rolled into formula grant with an adverse effect for Havering. This may not be the case.

There was also the Fair Funding Review which distributed funding across local authorities. This was likely to re-distribute funding away from London to the rest of the country.

The Board noted the contents of the reports.