Agenda item

Officer: Richard Simpson

Key decision: no

The Leader of the Council has delegated to the Cabinet the power to make the decisions set out below.

RESOLVED to:

1.    Note the current revenue outturn forecast at the end of the first quarter of 2018/19 of £1.468m, this is before exceptional items of £1.131m, resulting in a total overspend of £2.599m;

2.    Note the ongoing engagement with and lobbying of Government by the Council for additional funding for Croydon, both in general terms and specifically Unaccompanied Asylum Seeking Children given Croydon’s gateway status, fire safety measures and mitigation of the impact of the Universal Credit implementation.

3.    Note the HRA position of a £0.725m forecast underspend against budget;

4.    Note the capital outturn projection of £466m, forecast to be an underspend of £37.9m against budget;

5.    Approve the changes to the capital programme, as set out in paragraph 7.4 and Table 6.

6.    Note the letter that was sent to Home Secretary, attached at appendix 3, requesting a review of our UASC funding rates for 2018/19.

The Leader informed Cabinet that the Quarter 1 Financial Performance 2018/19 and Medium Term Financial Strategy 2018/2022 would be taken as one item at the meeting.

The Cabinet Member for Finance & Resources stated that the Financial Strategy had been drafted against the backdrop of financially challenging times for local authorities, with a number of authorities close to being unable to balance their budgets, due to the cuts being experienced by local government.

In Croydon it was recognised there was a fast growing population which also brought a number of challenges in ensuring that services with delivered despite the reduction in government grants. The Strategy sought to set out the service areas that would likely see a rise in demand and the areas of possible growth. However, due to the lack of concrete plans from the government in regard to funding beyond April 2020, assumptions had been made on the level of government funding that might be received, that council tax would increase by 2% each year, and that the Adult Social Care precept would also continue.

Whilst it was recognised that to ensure the budget was balanced £26 million of savings or additional income would need to be realised; the council would continue to spend an additional £17million on children’s services to ensure it delivered and would be sustainable.

The Cabinet Member informed Members that key areas of savings and income over the next four years were outlined within the report. The Corporate Plan was highlighted for the focus on prevention work, working in localities and joining up services. By working to keep families out of crises there would be improved outcomes for families and a reduced pressure on the public purse.

The asset investment strategy was highlighted by the Cabinet Member for having been designed to provide net revenue to the council by using the authority’s borrowing power. The revenue would be used to improve services and housing.

The Executive Director informed Members that the Medium Term Financial Strategy did not provide a detailed budget for the next four years, and reports would continue to be brought to Cabinet four times a year outlining the financial position of the council. The uncertainty of funding, in particular in regards to adult social care was noted, and as such income would be crucial to delivering the Strategy.

The Cabinet Member stated that the Quarter 1 financial performance showed continuing pressures on services with an increased number of looked after children, continued pressures on SEN transport and adult social care. It further noted that there had been £2.8 million from property income; however there was a forecast overspend of £1.5 million. Unaccompanied Asylum Seekers had an associated net cost of £7 million and despite work to get the Home Office to recognise the expenditure there had not been a response to a letter to the Home Secretary in relation to the expenditure.

In response to the forecasted overspend, the Cabinet Member informed Members that income and savings initiatives for 2019/2020 were being reviewed as to whether they could be brought forward to the current financial year.

In response to Member questions the Leader stated that the increase in Member Allowances had been the first in ten years and it was felt that it was important to ensure Members were paid allowances that reflected their work. It was suggested that if a Member did not wish to take the increased allowance then it could be arranged that they did not receive it.

The Executive Director informed Members that when the budget was set that early estimates had been made in regards to the Brick by Brick dividends. The business plan for Brick by Brick, that had been agreed by Cabinet after the budget had been set, suggested that dividends would be received at varying levels over a long period of time. As such, it was stated that the situation would be reviewed once dividends were received as to whether the monies would be released to the general budget to deliver services or would be kept in reserves. With regards to the re-profiling of Brick by Brick schemes Members were informed that the details would be provided.

In response to Member questions the Cabinet Member confirmed that the overspend of £700,000 on street lighting had been due to the increase in energy costs, however the contract was due to be re-procured and the cost of energy would be reviewed to reduce the pressure experienced.

The Leader of the Council delegated to the Cabinet the power to make the decisions set out below.

RESOLVED to:

1.    Note the current revenue outturn forecast at the end of the first quarter of 2018/19 of £1.468m, this is before exceptional items of £1.131m, resulting in a total overspend of £2.599m;

2.    Note the ongoing engagement with and lobbying of Government by the Council for additional funding for Croydon, both in general terms and specifically Unaccompanied Asylum Seeking Children given Croydon’s gateway status, fire safety measures and mitigation of the impact of the Universal Credit implementation.

3.    Note the HRA position of a £0.725m forecast underspend against budget;

4.    Note the capital outturn projection of £466m, forecast to be an underspend of £37.9m against budget;

5.    Approve the changes to the capital programme, as set out in paragraph 7.4 and Table 6.

6.    Note the letter that was sent to Home Secretary, attached at appendix 3, requesting a review of our UASC funding rates for 2018/19.