Decision details

To agree the 2022/2023 Council Budget and Council Tax level and agree the 2022-26 Medium Term Financial Strategy.

Cabinet considered the 2022/23 Budget and 2022-2026 Medium Term Financial Strategy report presented by Chief Financial Officer Jane West.

It was explained in the report that the Council’s current financial situation and its approach to achieving financial balance over the period 2022/23 to 2025/26.

The Council continued to deliver key services to residents during the pandemic and it remained on track to deliver the four year £40 million capital spend on roads (2019/20- 2022/23).

The 2022/23 budget and four year medium also recognised the additional demand and cost pressures the Council was facing following the pandemic. It assumed there would be no further lockdowns and that services would be able to operate without further restrictions. As this was a national issue, if further restrictions were put in place, the Government would provide funding to cover additional pressures.

It was to be noted that the Council had experienced high increases in demand for Social Care in the period following lockdown. The numbers of discharges from hospitals continued to be at very high levels and placed extreme pressures on the Adult Social Care budget to meet the needs of these clients. Demand was also rising in Children’s services as the number of referrals post lockdown increases at a fast rate.

The medium term financial strategy modelled the impact of this demand and also modelled the extent to which the pressure will change in future years. There would be risk associated with those assumptions and they would be monitored closely.

The Council’s medium term financial strategy presented to Council in March 2021 identified a financial gap for 2022/23 to be closed. The increased demand on social care together with rising inflation had increased this gap over the last year and required the Council to find significant savings and efficiencies to close the gap and set the balanced budget proposed in the report.

Jane West explained that although there was a balance of the budget there would be challenges in later years. There are savings of £28.4m set over four years but there was lots of uncertainty around future of central government funding and therefore reserves needed to be kept as high as possible. Risks included in the report were those around adult social care, levels of inflation, debt charges and overspend driven by capital programme would need to be monitored closely and carefully.

Other comments were made on how the main focus was on delivery and that £54m of contract value had been awarded with £18.5 of that gone to local businesses. The increase of growth and economic development led to local people getting jobs and upskilling and helped the high street to continue trading.

The Leader and other Members discussed and commented on how the pandemic had brought about many wider far reaching issues and demand specifically within health and social care but that the community had come together and staff within the Council, NHS and wider community had a spirit of dedication and service.

The concept of levelling up was also discussed and the Leader and Andrew Blake Herbert confirmed that they were taking every opportunity to lobby central government on this matter, rather than waiting on an outcome.

In terms of further reduction of the budget, voluntary redundancies for Council staff had been underway and further redundancies were being proposed. However the focus was on a culture change of gaining efficiency and looking at specific jobs and tasks and not individuals. There was a focus on training and finding creative and innovative ways to cut costs and using apprenticeship levies were possible.

Cabinet:

AGREED the following:

1.    The Council Tax requirement for 2022/23 to be set at £140.823m as set out in section 6 and Appendix G of the report.

2.    The Delegated Schools’ draft budget set out in section 5.13 of this report.

3.    A 1.99% increase in core Council Tax for 2022/23 as set out in paragraph 6.8.

4.    An additional 1% Council tax increase for the Adult Social Care Precept.

5.    To note the Medium Term Financial Strategy position as set out in Section 8.

6.    To agree the fees and charges schedule as set out in Section 9 and Appendix C.

7.    To note the risks to the 2022/23 budget as set out in Section 12.

8.    To note the requirements of S106 of the LGA 1992 Act as set out in Section 1.

9.    To agree that to facilitate the usage of un-ringfenced resources, the Chief Financial Officer in consultation with Service Directors will review any such new funds allocated to Havering; make proposals for their use; and obtain approval by the Leader and the Cabinet Member for Finance and Property.

10. To delegate to the Chief Financial Officer in consultation with Service Directors the authority to make any necessary changes to service and the associated budgets relating to any subsequent specific grant funding announcements, where delays may otherwise adversely impact on service delivery and/or budgetary control, subject to consultation with Cabinet Members as appropriate.

11. To delegate 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.

12. To delegate to the Directors of Children’s and Adults authority to agree inflation rates with social care providers for 2022/23.

13. To read the Equalities Impact Assessment in respect of the CTS Scheme as set out in Appendix E to this report.

14. To read the summary version of the Council Tax Support Scheme for 2022/23 as set out in Appendix F to this report (unchanged from 2021/22).

15. To delegate authority to the Chief Executive, in consultation with the Leader and with the Council’s recognised trade unions, to devise and implement a voluntary release scheme for staff as part of the Medium Term Financial Strategy position set out in Section 8.2.

Recommendations for consideration and agreement at Council Meeting:

1.    To agree the Council Tax requirement for 2022/23 to be set at £140.823m as set out in section 6 and Appendix G of the report.

2.    The Delegated Schools’ draft budget set out in section 5.9 of this report; Page 57.

3.    A 1.99% increase in core Council Tax for 2022/23 as set out in paragraph 6.8;

4.    An additional 1% Adult Social Care Precept ;

5.    That it pass a resolution as set out in section 14 of this report to enable Council Tax discounts for early payment to be given at the 2021/22 level of 1.5%.

6.    Recommend to Full Council that the Council Tax Support Scheme for 2022/23 is adopted as set out in Section 15 of this report (unchanged from 2021/22).