Agenda item

Councillor Roger Ramsey, Cabinet Member for Value, introduced the report

Cabinet was reminded that it had received reports in May and September 2014 which had provided updates on fiscal developments at the national level and the consequential impact on local government funding and set out information on the financial position within Havering.

The September report set out the Council’s long term financial strategy to manage the implications of funding reductions and cost pressures over the next four years.  It contained specific proposals to bridge the funding gap for the next two years, with further proposals that would move the Authority towards a balanced four-year budget.

The report updated Members on the Local Government financial settlement and the progress of the corporate budget and the proposed financial strategy for the coming financial year, the latest in-year financial monitor, feedback on the public consultation to the proposals affecting services which were included in the September report and the proposed capital programme.

The provisional Local Government Financial Settlement had now been announced, and relevant details were included in the report, together with a summary of the key elements of the Autumn Budget Statement.

The report also set out the Council’s capital spending position.

Cabinet was reminded that the demographic growth built into the budget was held corporately until it was demonstrated that it was needed.  This would now be released to help manage the pressures in Adults and Children’s services.  Members were also reminded that the provision for demographic growth in the budget assumptions had been reduced as part of lowering the budget gap from £60m to £45m.  However, the levels of demand in Children’s services had required the Council to review the previously reduced demographic growth build into the budget forecast.  It was therefore considered prudent to increase the demographic growth back to £1m in light of these pressures, an increase of £500k.

Cabinet was informed that there had been a substantial number of responses to several aspects of the recent consultation.  Though the majority of respondents had been in favour of the overall strategy, a considerable number of representations had been received about particular areas.

Specifically, a significant number of responses had been received about the libraries proposals - and in the light of these and the fact that libraries were an important statutory service - the proposals were being reviewed to consider whether adjustments could be made.  This had been a statutory consultation.

A considerable response had also been received about the youth service proposals.  In addition to the consultation responses, the demographic area showing most change was around children’s services, particularly around increases in looked-after children and an increased number of troubled adolescents.  Members were informed that the Council had recently received good feedback from a peer review on the way it was tackling serious youth violence - though the feedback did recognise that the Council needed to commission new services for a challenging group of young people as part of its preventative work.  Crime and safety was also given the highest priority within the overall consultation responses received.  Consequently the proposals around youth service reductions were to be reviewed.

Parking was also considered for review to see whether any changes to the strategy were required as this was also a statutory consultation.

Given the changes highlighted in the report, it had been found that there was currently about £500k of headroom within the overall budget strategy which would allow Cabinet to consider possible changes to the proposals originally presented and - in light of the consultation feedback, officers would be asked to review those proposals.

Reasons for the decision:

This enables the Council to develop its budget as set out in the constitution.

Other options considered:

None.  The Constitution requires this as a step towards setting its budget.

Cabinet:

1.            Noted the progress made to date with the development of the Council’s budget for 2015/16 and the Council’s intention to increase council tax up to 2%.

2.            Noted the outcome of the Autumn Budget Statement and the likely impact on local authorities.

3.            Noted the outcome of the local government financial settlement announcement, and that arising from the settlement, there would be reductions in mainstream Government funding 2015/16 of £10.02 m.

4.            Delegated authority to the Cabinet Member for Adult Social Services and Health and the Leader to approve an annual spend plan for the Public Health grant.

5.            Delegated to the Group Director for Children Adults and Housing to agree inflation rates with social care providers for 2015/16.

6.            Noted the extensive consultation responses set out in Appendix D to the report.

7.            Noted the financial position of the Council in the current year.

8.            Noted that a report will be made to Cabinet on 4^th February to consider any possible changes to the budget strategy following this Cabinet meeting and requested officers to consider whether the savings proposals in respect of libraries and youth services, along with any others identified at the meeting should be reconsidered in the light of consultation responses.  

9.            Agreed the adjustments to the budget assumptions set out in paragraphs 2 and 3 of the report in respect of assumptions about the council tax base, un-ring-fenced grants, demographic growth, inflation and the risks in terms of new legislation.

10.         Noted the proposed Capital programme for the two years of the budget strategy.

11.         Agreed that any future underspends from the Corporate Contingency Fund, from the Transformation budget, and from any service revenue underspends, were allocated to the Strategic Reserve.

12.         Noted the summary of the GLA’s consultation budget and the expected date for the publication of the final proposals.