Agenda and minutes

Please note that this meeting may be filmed or recorded by the Council for live or subsequent broadcast via the Council’s internet site or by anyone attending the meeting using any communication method. Although we ask members of the public recording, filming or reporting on the meeting not to include the public seating areas, members of the public attending the meeting should be aware that we cannot guarantee that they will not be filmed or recorded by others attending the meeting. Members of the public participating in the meeting (e.g. making deputations, asking questions, making oral protests) should be aware that they are likely to be filmed, recorded or reported on. 

By entering the meeting room and using the public seating area, you are consenting to being filmed and to the possible use of those images and sound recordings.

The chair of the meeting has the discretion to terminate or suspend filming or recording, if in his or her opinion continuation of the filming, recording or reporting would disrupt or prejudice the proceedings, infringe the rights of any individual or may lead to the breach of a legal obligation by the Council.

The Chair referred Members present to item one on the agenda in respect of filming at the meeting and Members noted the information contained therein.

The Chair agreed to alter the published agenda so that Agenda Item 9 – Scrutiny of the 2024/25 Draft budget was taken before Item 8 – Cabinet Member questions.

*Clerk’s note - the minutes reflect the order the items were discussed, rather than the order given on the agenda.*

None

None

To receive and note the minutes of the following Scrutiny Panels and to approve any recommendations contained within:

Adults and Health Scrutiny Panel – 8^th December 2022

Housing, Planning and Development Scrutiny Panel – 12^th December 2022

Environment & Community Safety Scrutiny Panel – 15th December 2022

Children and Young People’s Scrutiny Panel – 3^rd January 2023 (To follow)

The minutes of Children and Young People’s Scrutiny Panel on 3^rd January 2023, which were marked to follow on the agenda were withdrawn.

The minutes following Scrutiny Panels were received and noted and any recommendations contained within were approved:

Adults and Health Scrutiny Panel – 8^th December 2022

Housing, Planning and Development Scrutiny Panel – 12^th December 2022

Environment & Community Safety Scrutiny Panel – 15th December 2022

To receive and make comments on the Treasury Management Strategy Statement for 2023/24.

The Committee received the draft Treasury Management Strategy Statement for 2023/24 for comments, before it was presented to Corporate Committee and then Full Council for final approval. The report was introduced by Tim Mpofu, Head of Pensions and Treasury, as set out in the agenda pack at pages 35-60. The following arose during the discussion of this item:

a.    The Committee noted that the Council was due to increase its borrowing year and year and queried the reasons why around half of this borrowing was in the General Fund, and was therefore not related to housebuilding. In response, officers advised that one of the primary drivers were various regeneration schemes that the authority was preparing for as part of its financial framework. It was emphasised that a number of these were self-financing, and that they would only proceed following a final decision by Members. Other areas relevant to increased borrowing the General Fund were noted as: Increased expenditure in the schools budget; maintaining key infrastructure in the borough such as roads, parks and bridges; the development of the civic centre; and digital transformation.

b.    In relation to a follow-up, officers confirmed that the key regeneration projects were Gourlay Place, Wards Corner and the Selby Centre and that these included an element of housing which was in the General Fund at present but would be transferred over to the HRA in future.  

c.    In light of the significant increases in borrowing, the Committee sought assurances about rising interest rates and the risk this posed to the Council. In response, officers advised that the capital programme was a framework to allow the Council to undertake these schemes at a future date and that a future decision would be made on a scheme by scheme basis, which involved individual business cases with up to date borrowing costs in each business case. It was also noted that the Council’s TM strategy was based on advice it had received from Arlingclose. Officers advised that of course interest rates going up was a significant challenge for the Council and was one of the main drivers behind the financial challenges that it faced. The Council needed to be able to profile the debt so that the point at which it reached maturity was spread out.

d.    The Committee questioned whether there was a legal limit on how  much an authority could borrow or whether it was all down to individual business cases. In response, officers advised that there was no formula for determining the maximum a Council could borrow, however the authority had to operate within the parameters of the prudential code. The Treasury Management Strategy set out the local financial consequences of existing and new borrowing, translating into changes in debt provision in future years. The impact of this on the revenue account was set out in terms of the costs to maintain that debt. This was the acid test of whether a particular level of borrowing was deemed to be affordable or not. The business  ...  view the full minutes text for item 58.

List of Documents:

MTFS Cover Report

Appendix A – Key lines of enquiry for budget setting

Appendix B – 2023/24 Draft Budget and 2023/2028 Medium Term Financial Strategy Report (presented to Cabinet 6^th December 2022)

Appendix C – Summary of General Fund Revenue 2022-23 Budget and Medium Term Financial Plan 2023-2028

Appendix D – 2023/24 New Revenue Growth Proposals

Appendix E – Summary of total agreed Revenue budget reduction proposals 2023-2028

Appendix F -2023/2028 Proposed Capital Programme

Appendix G – New Capital Budget Proposals 2023/24

Appendix H – MTFS Savings Tracker 2022/23-2025/26

Appendix I – Budget Scrutiny Recommendations Cover Report (To Follow)

Appendix J - Budget Scrutiny Recommendations (To Follow)

The Committee received the Council’s 2023/24 Draft Budget and 5 Year Medium Term Financial Strategy (MTFS) 2023/2028 proposals. The report was introduced by Jon Warlow, Director of Finance as set out in the agenda pack at pages 61- 174. The Cabinet Member for Finance and Local Investment, Sarah Williams was also present for this agenda item. Frances Palopoli and Josephine Lyseight from Corporate Finance were also present. As the Chair of Budget Scrutiny, Cllr Connor chaired the meeting for this agenda item. The key points of the Director of Finance’s introduction were noted as:

·         As in recent years, this budget was set in a very challenging climate for this local authority, and the UK more generally. The overspend at Quarter 2 of the current 2022/23 financial year was around £16m. A significant improvement to this position was not anticipated and the degree of challenge was not expected to lessen. The overspend was primarily related to care service areas.

·         The draft report presented to Members was prepared in December and was a best estimate in advance of the local government provisional financial statement.

·         It was commented that in light of the savings programme this year, the amount of savings not achieved at all, was not unreasonable. Some of the previous savings have been re-profiled to future years.

·         The Director of Finance advised that there was nearly £50m of additional investment in the budget, two-thirds of which was in care services. The additional net savings programme totalled around £10m. There were no new savings put forward in last year’s budget.

·         There was a circa £3m budget gap in the draft report, but this was before the local government finance settlement was released.

·         There had been reports in the media that the government had increased core spending power for local authorities by an average of 9.2%. This was 9.8% for Haringey. This core spending power was made up of the majority of income streams to the General Fund including the revenue support grant, new homes bonus, social care grants and Council Tax. The majority of this increase was predicated on increasing Council Tax by the maximum permitted of 4.99%. The draft budget had been set with an assumption of a 2.99% increase.

·         The Director of Finance advised that the main funding elements for Haringey had broadly come out as anticipated. Social care grants were higher than expected by around £10m. Of that £10m, £3.3m were specific grants, which left around £6.5m increase in the social care grant. Whilst the additional funding was welcomed, the Director cautioned that this did not even match the degree of expected increase in spending forecast in the social care area.

·         The consequences of the grant announcements would be further reflected in the February report. The final MTFS report in February would set a balanced budget, as required by law.

·         In relation to the HRA, the Committee was advised that there was a new form of rent modelled at a 7% increase, as announced by the government.

·         In relation  ...  view the full minutes text for item 59.

Verbal update

The Committee undertook a Q&A Session with the Cabinet Member for Finance and Local Investment. The following arose as part of this session:

a.    The Committee enquired whether any decision had been taken in relation to setting the next year’s Council Tax rates. In response, the Cabinet Member advised that this was still under consideration at the current stage.

b.    The Committee asked for further information about how participatory budgeting would work. In response, the Cabinet Member advised that there were a variety of different models but that Haringey would be looking to involve resident engagement in its future budgetary processes. It was also suggested that this would include allowing local groups to spend local pots of money, such as the Carbon Fund.

c.    In response to a follow-up question, the Cabinet Member advised that she did not envisage consulting on the budget at an earlier stage in future, given how late much of the funding information was received from government and the resultant difficultly in making that engagement meaningful.

d.    The Committee sought assurances from the Cabinet Member about the level of borrowing proposed as part of the capital budget. In response, the Committee was advised that officers had provided assurances about the need for robust business plans to be in place and the need for continuous monitoring. The Cabinet Member set out that in times of austerity, the capital budget allowed the Council an opportunity to improve things for local residents, such as providing better parks and better housing.

e.    The Committee sought clarification about whether the Cabinet Member was suggesting that there was a risk that by not investing in the borough through the capital programme, that the long terms costs to the revenue budget would be even higher. In response, the Cabinet Member acknowledged that this was absolutely the case and cited the Safety Valve project as a relevant  example of invest to save.  

f.     The Committee queried whether the local authority had considered the impact of budget deficits on schools in the east of the borough, including the fact that a number were having to make teachers and teaching assistants redundant. In response, the Cabinet Member acknowledged these concerns and advised that this was a prominent issue at the forefront of people’s minds, which had been raised at a number of recent meetings that she had attended.

RESOLVED

Noted.

N/A

30^th March

30^th March