Issue - meetings

Report of the Director of Finance. To be introduced by the Cabinet Member for Finance and Corporate Services.

This report will provide an update on the Quarter 2 budget monitoring and Council's financial position. It will seek approval for any changes to the Council's revenue or capital budgets required to respond to the changing financial scenario and the delivery of the MTFS.

The Cabinet Member for Finance and Corporate Services introduced the report which set out the budget update covering the position at Quarter 2 (Period 6) of the 2024/25 financial year including General Fund (GF) Revenue, Capital, Housing Revenue Account (HRA) and Dedicated Schools Grant (DSG) budgets. The report focused on significant budget variances including those arising from the forecast non-achievement of approved Medium Term Financial Strategy (MTFS) savings.

The following issues were outlined by the Cabinet Member:

-       Haringey, amongst other boroughs, continued to face considerable in year demand pressures, particularly in the cost and complexity of delivering adult social care, children’s social care and the rise in costs of securing temporary accommodation for homeless households.

-       The need to continue to be ambitious for the borough and residents despite difficult financial circumstances and maintain the achievements and aims of the Council such as: 98% of all schools good or outstanding,  Children’s services graded ‘Good’ by Ofsted, SEND receiving the highest possible grading, delivering 3,000 new, high quality Council homes by 2031, planting thousands of trees and continuing Haringey Works to provide local employment.

-       Haringey was considered an outer London borough for funding purposes (although inner London for statistical purposes) but has all the pressures of an inner London borough with the additional burden of lower business rates receipts and an average of band C for Council tax.

-       The Housing Revenue Account (HRA) continued to show pressure, caused primarily by the continued high number of void properties, the rising cost of repairs and dealing with damp and mould. This had been mitigated by a reduction in capital spend and some staff vacancies. The HRA budget overspend was still well within the £8m set aside annually for capital investment.

-       The capital programme was under constant review to reduce the revenue implications of any additional borrowing.

-       The Council were working on agreed Budget for 2025/26 and medium-term financial strategy (MTFS). The impact of in-year pressures on next year’s budget and Corporate Delivery Plan were well recognised and officers were working on all measures to reduce demand.

In response to comments and questions from Cllr Cawley- Harrison, the following information was shared.

-       Responding to the remark on the significant and worrying increase in the Council’s budget gap since the last quarterly update report to Cabinet, and concern about the confidence in the budget setting process together with the frequency of budget monitoring reports, it was noted that part of the overspend was due to now better being able to quantify budget risks, particularly in terms of bad debts provision, and housing benefit payment issues. The Director of Finance would be introducing a half year position report to avoid some surprises in the budget forecast going forward. There was also a second piece of work being completed on providing assurance about next year's budget and this was the detailed review on the delivery of savings with more realistic assumptions, which was also now showing an impact in figures  ...  view the full minutes text for item 85