Decision Maker: Cabinet
Decision status: Recommendations Approved
Is Key decision?: Yes
Is subject to call in?: Yes
The July Financial Planning and Medium Term
Strategy Report will provide an update on the economic outlook,
pressures, risk areas and set out the revenue funding deficit for
2021-26 as well as the timetable for setting the Council’s
budget in February 2022.
In introducing the report the Cabinet Member for Finance and Investment, Councillor Andy Wilson informed Cabinet if the following
· We were planning for our financial future in a state of continued uncertainty not only due to the pandemic and Brexit, but with the future of local government finance and the long-term funding pressures of essential services.
· With the emergence of new variants, the ending of the furlough scheme along with uncertainty about the future of government support and the national management of the pandemic, the impact on the income sources for local government was worrying and uncertain.
· Council Tax and Business Rates would have to play a greater role in ensuring the council stays on a sustainable financial footing and was able to continue delivering services for its residents.
· Council Tax had to be increased to fund services and the Covid recovery. In recognition of this reliance upon Council Tax, the council had expanded the support available for residents in financial difficulty so that more people could receive the support they need.
· The Council had expanded support for vulnerable people who struggle to pay their Council Tax by increasing the scope and funding for our Council Tax Support scheme. The extra £1.5m Hardship Support Grant would support almost 7,000 households eligible for Council Tax Support, with most of those seeing their bill reduced to nil, if they were struggling to meet the costs.
· The council had also begun consultation to make a permanent adjustment to the Council Tax Support scheme for 2022/23 to protect more residents who find the increase in Council Tax unaffordable.
· The Covid-19 crisis had a significant financial impact and would continue have a long-term effect on the pressures on expenditure as well as the level of resources available to the council.
· Lambeth’s financial strategy would be continually developed so that it underpins and supports the delivery of Lambeth’s priorities of supporting the local economy, increasing community resilience, promoting care, independence, and equality, strengthening diversity and delivering inclusion for all the borough’s communities.
Councillor Scott Ainslie from the Green Group questioned point 4 of the recommendations set out on page 38 of the agenda, he requested confirmation on whether the £8.5 million overspend was in addition to the £12.1 million. Further queries were raised on the proposals and reasons section of the report which included:
· Why were Lambeth residents forecasted as the highest unemployed?
· Point 2.27 figures were inconsistent, there was an £8.5m overspend gap and therefore wanted clarity.
· Wanted to know how confident the Council was that they would receive the £19.2 million from the government.
· Temporary accommodation was increasing, was this going up due to estate regenerations.
In response to some of the questions raised, Cabinet Member for Finance and Investment, Councillor Andy Wilson and Officer advised that:
· The overspend of £8.5m was set out in the report.
· The Council continue to pursue covid spend from central government and had received a large part of it for this financial year.
· Additional pressues woud need to be managed within the Medium Term Financial Strategy.
· Council tenants on estates that were being regenerated would retain the same tenancies with the same set rent that they had prior. It was reiterated that the Council would not lose any Council/Social housing as more were being built.
Councillor Claire Holland, the Leader of the Council, concluded the item by suggesting that any further questions from the opposition were to be raised after the meeting and stated that she was grateful that the Council was in the position that they were in.
1. To note the key risks set out in paragraphs 2.10 to 2.54
2. To note the Council’s commitment to delivering the agreed revenue savings planned for 2022/23 (£13.698m) and 2023/24 to 2024/25 (£7.765m), as set out in Table 3.
3. To approve the change to the funding deficit as set out in Table 3 and the consequent amendment to the Council’s Medium Term Financial Strategy.
4. To note the 2020/21 General Fund, overspend of £8.5m as confirmed in Table 5 paragraph 2.55
5. To note the 2020/21 Housing Revenue Account outturn as confirmed in Table 6 paragraph 2.63
6. To note the capital investment outturn of £117.1m against the 2020/21 budget of £259.3m as detailed in paragraphs 3.1 to 3.2 and Appendix 1.
7. To note the 4-year Capital Investment Programme for the period 2021/22 to 2024/25 as set out in paragraphs 3.5 to 3.7 and summarised in Appendix 2
Report author: Amaris Wong
Publication date: 09/07/2021
Date of decision: 05/07/2021
Decided at meeting: 05/07/2021 - Cabinet
Effective from: 17/07/2021