Agenda item

Members attending the Cabinet Meeting on 18 January and the Joint Meeting of all Overview & Scrutiny Committees on 19 January are requested to bring the copy of the budget report to the meeting(s) with them.

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

Cabinet received a report at the last meeting in December which set out the details of national developments and information on the financial position within Havering.

The current report updated Members on the progress of the 2012/15 corporate budget and the proposed financial strategy for responding to the financial position facing the Council.  The report also set out the additional proposals which had been identified for consideration by all the relevant Committees and for consultation with stakeholders.

The provisional Local Government Financial Settlement had now been announced, and relevant details were included in the report.

Reasons for the decision:

The report enabled the Council to develop its budget as set out in the constitution.

Other options considered:

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

In response to a question about the possibility of there being a need to hold a referendum if there were any shortfall in income and the only way to meet that shortfall was to raise the Council Tax above the capped level, the Cabinet Member for Value agreed that a referendum would indeed be costly but added that Havering was better placed than other London boroughs to be able to meet its obligations without the need to exceed the 3.5% cap.  He added that there was a need to consider different options for the future and that it was impractical to try to cover all costs simply by raising business rates and that the possibility of some form of “pooling” across the London boroughs could be a way to ensure that risk was better managed in future.

Cabinet AGREED to:

1.                  Approve the progress made to date with the development of the Council’s budget for 2012/13 and beyond.

2.                  Note the outcome of the provisional local government financial settlement announcement and in particular, the expected reduction in Government funding for 2012/13 of £5m.

3.                  Note the expected date for the announcement of the final settlement and that, owing to timing, further supplemental information to the main Council Tax report might need to be submitted at the February Cabinet meeting.

4.                  Note the comments of the Local Government Minister on expected council tax increases and the introduction of referenda where rises were beyond defined levels.

5.                  Note that the proposals contained in the reports to Cabinet in July 2010 and July 2011 were now being incorporated in the Council’s future budget.

1.                  Note the Council’s intention to take advantage of the additional Council Tax freeze grant for 2012/13.

2.                  Issue the report for consultation to Members, the unions and affected staff, and other stakeholder groups.

3.                  Agree that a consultative presentation would be made to a joint meeting of the Overview & Scrutiny Committees.

4.                  Note the financial position of the Council in the current year.

5.                  Note that the GLA’s consultation budget had yet to be published, details would be provided separately.

6.                  Note that the Administration was committed to maintaining the stability of the Council's finances and was doing everything it could to keep Council Tax rises to a minimum.