Agenda item

Cabinet Member: Cabinet Member for Croydon Renewal, Councillor Stuart King and Cabinet Member for Resources & Financial Governance, Callton Young

Officer: Interim Corporate Director Resources, Richard Ennis

Key decision: no

The Leader of the Council delegated authority to the Cabinet to make the following decisions:

RESOLVED: To

1. Note the General Fund is projecting a net favourable movement of £0.828m from Month 7. Service directorates are indicating a £2.203m overspend (Month 7 £3.030m) with this being netted of as in the past seven months against the release of a one off Covid Grant (£3.451m released = 31% of the gran t) confirmed to Croydon Council for 21/22 by DLUHC as part of the Local Government Finance Settlement;

2. Note that a further number of risks and compensating opportunities may materialise which would see the forecast year-end variance change and these are reported within Section 3 of this report.

3. Note the Housing Revenue Account (HRA) is projecting a £1.634m (Month 7 £0.786m) overspend for 2021/22. If no further mitigations are found to reduce this overspend the HRA will need to drawdown reserves from HRA balances. There are sufficient balances to cover this expenditure.

4. Note the capital spend to date for the General Fund of £13.271m (against a budget of £190.581m) and for the HRA of £8.128m (against a budget of £183.209m), with a projected forecast variance of £58.683m on the General Fund against budget and £110.570m forecast variance against budget for the Housing Revenue Account;

5. Note, the above figures are predicated on forecasts from Month 8 to the year end and therefore could be subject to change as forecasts are refined and new and updated information is provided on a monthly basis. Forecasts are made based on the best available information at this time.

6. Note that whilst the Section 114 notice has formally been lifted, the internal controls established as part of the S114, such as the Spend Control Panel and Social Care Placement Panels remain. Restrictions have been lifted for ring-fenced accounts such as the Pension Fund, Housing Revenue Account and Coroner’s Expenditure as these are directly outside of the General Fund’s control. The Spending Control Panel which was set up at the beginning of November 2020 continues to meet on a twice daily basis.

7. Note that, Croydon Borough has taken on c1000 asylum seekers who have been placed in eight hotels by the Home Office without consultation with the Council. The hotel costs are funded by the Home Office, however the Council is be responsible for further ancillary services particularly around safeguarding, public health, children & youth provision and broader community support. These additional costs, which are currently being calculated have been flagged within the unquantified risks section of this report, and could clearly result in further financial pressures for the Council.

8. Note the Council has now renegotiated a revised loan agreement with Boxpark Croydon Ltd and to date Boxpark have ensured that they have paid the Council according to the terms of the revised agreement. The Council continues to monitor this repayment and will take necessary actions in the event of delays.

Mr Ennis summarised the item and outlined details of a £1.25m underspend in the budget and work being done to mitigate risk. Further figures included:

· £1.6m overspend for the Housing Revenue account;

· Capital spend continued to be very low and making sure that Council was able to deliver much of the programme for the remainder of this year as a priority.

Members stated the importance of demonstrating that the council was improving its hold on its finances and acknowledged that decisions were collectively working towards achieving a balanced budget. The Chair invited comments from colleagues. Cabinet members raised several points:

· They asked for clarification on the use of the Covid grant and asked for reassurance that it was being used appropriately;

· They welcomed the performance report but asked for feedback on HRA risks.

Mr Ennis addressed the key points made by members, summarising details of the application of the Covid grant. He assured colleagues that it had been used appropriately and this had been demonstrated and supported by the Improvement Panel.

Mr Ennis asked David Padfield to respond to concerns around figures on outstanding repairs and members were assured that a report would be available at the next Cabinet meeting.

Members agreed the recommendations.