Agenda item

[Report of the Director  of Finance.To be introduced by the Cabinet Member for Finance and Strategic Regeneration]

This will report will provide an update on the actual and forecast impact of Covid-19 on Council General Fund, HRA & Capital budgets and the MTFS,  including notification of government funding.  It will seek approval for any budget changes required.

The Cabinet Member for Finance and Strategic Regeneration introduced the report which provided an update on the current estimated financial impact of Covid-19 and built on the 6 April 2020 Leader’s Signing report. The report set out further Government announcements, confirmation of agreed allocations of Government funding and recommended further allocations to be made.

The Cabinet Member noted that whilst it was expected that further funding would be forthcoming to balance additional expenditure, there would be difficult financial decisions to be made in the event that this funding was not forthcoming.

The Cabinet Member further referred to the tabled addendum report which clarified the financial implications for the Council of continued financial support for the home care sector as the transition to the new DPS arrangements, which incorporate the payment of LLW, take effect.

The addendum report provided a route for ensuring that care workers continue to be paid at rates which are commensurate with the valued work which they do for Haringey residents and supports implementation of the LLW for the care sector. This was at a quicker pace than previously envisaged and in a sustainable way despite the specific challenges of the Covid-19 pandemic for the care sector. The additional recommendations outlined at section 4.1.1 to 4.1.3 gave effect to this.

In response to questions from Councillors Dennison, Connor and Palmer, it was noted that:

• The funding allocation for the Discretionary Grant Funding scheme was 5% of projected spend for the initial two grant schemes. The baseline funding allocation for Haringey was £3.153m.

• Relevant information on expenditure on the Reopening High Streets Safety Fund would be provided to Councillor Dennison.

• Noted that local authorities will be subject to a series of impacts based on expenditure and loss of income experience which was a similar financial position to the national level. The report indicated that the Council was on track to receive around a third of the required funding needed to support the General Fund and this was in trend with other local authorities.

• The table at paragraph 8.6 provided a broad overview of the financial impact so far. This showed the potential effect on income ,expenditure  and planned savings, balanced against the received grant funding. Regarding expected grant funding to be received, while was a matter of interpretation, it  would be reasonable to conclude that  the Council’s  government  towards Covid 19 budget pressures to date was in proportion to the national position reported by the LGA .

• Details on the Care Home Support Plan was available on the Council’s website – https://www.haringey.gov.uk/social-care-and-health/covid-19-information-and-guidance-health-and-social-care-professionals
• The addendum outlined a series of recommendations, one of which was a continuation of a £2 uplift in hourly pay rate for home care workers from April-June. This uplift brought the hourly pay rate in line with the London Living Wage.

• The £1.4m income loss and £8.2m impact on the Housing Revenue Account would not be written off as it was expected, at this point in time, to be covered by government funding.

• Any rent deferrals would be reviewed and tenants would be expected to pay any monies due.

Further to considering the main report and addendum report with the additional recommendations, it was:

RESOLVED

1.         To note the updated financial implications of the Covid-19 crisis.

2.         To note the receipt of the second tranche of Covid-19 Government emergency response grant totalling £7.37m.

3.         To approve that this grant funding be added to the Emergency Response Contingency in the Council’s General Fund (GF) budget, and that the authorisation process for its application be subject to approval by the Council’s Finance Director (Section 151 Officer) unless above delegated limits (Section 7.2)

4.         To note the extent of the estimated Covid-19 related financial pressure and the on-going assumption that further grant support will be provided by Government to meet this overspend.

5.         To note that the Quarter 1 Budget report will provide an update on the impact of Covid-19 on the Council’s currently approved 2020/21 budgets and implications for the longer term MTFS.

6.         To approve an allocation of a further £2m from the Emergency Response Contingency (GF) to cover the on-going Homelessness demand pending the identification of longer-term solutions as set out in Section 9.4.

7.         To approve allocation of £0.355m from the Emergency Response Contingency (GF) to cover the 5% uplift to the Care Sector for the period 1 April – 31 May 2020 as set out in Section 9.4.

8.         To approve expenditure on emergency PPE this financial year of up to a maximum of £1m, to be funded from the Emergency Response Contingency (GF) as set out in Section 9.4.

9.         To approve an allocation of £0.393m from the Emergency Response Contingency (GF) for the direct purchase of emergency food supplies by the Council for the period to mid-July 2020, with a further allocation of £100k to fund longer term support as set out in Section 9.4.

10.      To approve £0.5m of additional revenue grant funding from the Emergency Response Contingency (GF) to APPCT in this year and also to note the deferral of all loan repayments by the APPCT totalling £0.414m due for 2020/21 as set out in Section 9.4.

11.      To note that the Council is investing £0.030m from the Emergency Response Contingency (GF) in making an extra 82 lamp posts suitable for use as locations to place banners in high-footfall locations to help the dissemination of messaging about Covid-19 related actions.

12.      To approve the continuation of the general approach to income collection, where appropriate, as approved in the 6 April 2020 report and approve that this be re-considered as part of the Quarter 1 report to Cabinet on 15 Sept 2020 (Section 9.3).

13.      To approve the continued payment of the £2 per hour uplift to all home care workers for all hours of home care delivered in Haringey for the period from 1^st July 2020 until 31^st July 2020.

14.      To approve the continued payment of the £2 per hour uplift to home care workers for those hours of home care delivered in Haringey which are not subject to the LLW requirements from 1^st August 2020 until the end of October 2020.

15.      To note that a care package review will be undertaken on all DPS care packages which are not otherwise subject to the terms and conditions on the new DPS before the end of October, reflecting the potential changing requirements caused by the Covid-19 environment and its implications, which would incorporate the payment of LLW on all such packages.

Reason for Decision

The coronavirus (COVID-19) is having a significant adverse effect on the economy and public finances, reducing demand and supply in the short and medium term, presenting individuals, businesses and organisations with unprecedented challenges. The long-term impact is unknown and will be dependent on factors including the extent of lasting damage to the economy’s supply capacity.

COVID-19 affects everything local authorities do – as community leaders, public health authorities, education authorities, employers, partners and service deliverers. The Leader, Cabinet and its officers continue to need to focus on responding to the crisis while ensuring normal critical services are provided. The Council has in place a number of key officer groups that meet frequently to evaluate and respond to the latest COVID-19 developments. The proposals within this report address their implications.

Alternative Options Considered

This is a national emergency and the Council must ensure that it is in the best possible place to continue to provide services, particularly in relation to support to the vulnerable, address public health issues, and act as an agent for the Government to ensure that funding and support gets to individuals and businesses in the most expedient fashion.