The Leader invited the second
deputation from Paul Burnham, representing Haringey Defend Council
Housing, to put forward his representations, in relation to the
Budget report.
Mr Burnham began his
representations by commending the Council for the role they played
with tenant campaigners, in influencing a change of policy, by the
Mayor London, to now use funding from government on all social
rents. This was included in the next iteration of the affordable
housing programme in London.
Mr Burnham called for a Council
programme of converting affordable rent back to real Council rents
and commented that this policy change did not feature in the
current budget. He referred to the Budget report which advised that
affordable rent tenants will have a social rent cap. However, this
was still £50 a week above the current Council rent rates for
a 2-bedroom property. Mr Burnham raised concern about the
implications in the Budget report that the rule on the social rent
cap was being applied to new homes being in the borough. He
referred to government mandatory policy on social rent setting and
having to use the rent formula. He further contested this formula
as studies showed that, even after taking into account the higher
house prices in the borough and having social rent outcomes, this
would not provide the affordability needed for tenants. This could
cause future issues for the Council with tenants who may not want
their homes demolished to face higher rents in their new
properties.
Mr Burnham continued to speak
on:
- The service
charges for tenants which were being taken forward without any
consultation.
- Issues with
the converted properties related to cleaning charges. Homes for
Haringey having to refund a lot of the charges up to March of this
year. The charges were 60% higher than they should be and there was
a request that they be corrected.
- The need for
financial reports, presented by Homes for Haringey, to show
itemised service charge expenditure which they did not at
present.
- Homes for
Haringey to open their accounts and empower tenants and
leaseholders to input on rent setting and service
charges.
Mr Burnham concluded by
requesting a meeting with the Cabinet Member for Housing and Estate
Renewal to discuss these two key issues raised in the deputation on
social rent setting and tenants and leaseholder cleaning
charges.
The Leader invited the Cabinet
Member for Housing and Estate Renewal to respond to the deputation
and the following information was provided.
- Haringey rents were
set in line with government guidance as prescribed by rent
standards. The government allowed English local authorities to
increase their rents by CPI + 1%. For 2021/22, rents would
therefore increase by no more than 1.5%, with the average rent
increase for 2021/2022 being £1.57 per week. These were for
rents which are currently below formula rent.
- Formula rent was not
just based on property value but also on number of bedrooms and
average earnings in the local area. Haringey rents were in line
with these.
- Haringey provides
information to tenants and leaseholders regarding their service
charges, also how it compares with prior years and how these are
calculated. These were highlighted in the service charge leaflets
and the FAQs that accompany the rent letters.
- There was no 60%
increase in the converted properties cleaning service charge for
2020/21. The converted properties’ cleaning service charge
for tenants actually reduced by 8.3% in 2020/21.
The Cabinet Member for Housing
and Estate Renewal welcomed a meeting with Paul Burnham and his
colleague from Haringey Defend Council Housing.
The Leader invited the Cabinet
Member for Finance and Strategic Regeneration to introduce the
budget for 2021 -22 and MTFS for 2021 to 2026.
The Cabinet Member for Finance
and Strategic Regeneration introduced the report which sought
approval to the proposals concerning the 2021/22 Budget and
five-year Medium-Term Financial Strategy (MTFS). The budget aimed
to provide a clear financial plan during this unprecedented period
for local authority budgeting, in a global pandemic at a time of
hardship, and financial uncertainty. The impact of the pandemic was
considered with the gross financial impact of the pandemic at
around £40millon compared to the planned budget.
The Cabinet Member outlined
that this was a progressive budget a continued to draw attention to
the relevant parts of the financial strategy concerning:
- Investment in the
revenue budget.
- Capital investments -
in particular: The Wood Green Hub , Youth services, school building
improvement works, roads, pavements, environment, expansion of
empty homes strategy, and the Pendarren youth facility.
- General Fund revenue
assumptions.
- The use of reserves
which was use of £1.7m as a one-off reserve. The Council were
previously examining, at the consultation stage, to use £5.4m
but as a result of the SR20 and number of improved grants, this had
been reduced.
- Housing Revenue
account , Business strategy, Dedicated Schools Budget,
The Cabinet Member concluded by
referring to the public consultation completed and the
consideration by Scrutiny of the budget .
Cllr Connor, Chair of Overview
and Scrutiny, presented the Overview and Scrutiny recommendations
produced by the main committee , scrutiny panels, with input from
the public and support by officers. She referred to the doubling of
capital spend from £1 billion over the last 50 years to
£2billion in the next 5 years. This called for increased
oversight of the budget and need for scrutiny to consider greater
detail of this spend with a new approach to capital budget scrutiny
. It was proposed that, going forward, there was more detail
provided to each scrutiny panel, with projects grouped together,
according to the panel’s responsibilities. This information
could follow the quarterly budget monitoring reports considered by
the panels and was requested to be supported by
officers.
The Vice Chair of Overview and
Scrutiny continued to highlight some of the key recommendations
arising from the Scrutiny Panels:
- The Environment and
Community Safety Scrutiny Panel produced some clear recommendations
around considering the impact on small businesses when introducing
Sunday parking charges and these seemed to have been not addressed
in the response to this recommendation. It was requested that these
issues are considered when the report on Parking Charges is
compiled for key decision at Cabinet.
- The answers to
questions by the Housing and Regeneration Panel raised further
questions and there was request for the Panel to be provided with
Officer support, prior to consideration of the quarterly budget
reports, to
enable them to examine the future capital borrowing in much
greater depth.
- The Children and
Young People’s Scrutiny Panel recommendations were based on
the pressures the service would face as a result of Covid. The
answer to these recommendations were noted and it was expected that
further scrutiny into these important areas would continue as the
deficit of high needs block, need for social workers, access to
free school meals, and addressing online school learning will
continue to be of concern.
- With regards to the
savings proposed to Learning Disabilities services, and mental
health services, it was questioned whether these were sensible,
especially during this time of increased service pressure due to
the pandemic. A request was made for these decisions to be
reconsidered.
- Within the
‘Your Council’ budget recommendations, there was a
request to reconsider the loss of up to 7 jobs in the Libraries
savings proposals.
In concluding her presentation,
the Vice Chair of Overview and Scrutiny, reiterated the specific
requests and recommendations for the further information required
and new format for next year’s revenue and capital budget
scrutiny. It was felt that as the Council’s capital borrowing
doubled , this could put significant pressure on the revenue budget
and the need for scrutinising these proposals would be even more
important.
Cllr Adje responded briefly to
the issues raised by Cllr Connor, thanking the Overview and
Scrutiny Committee and the Scrutiny Panels for their work in
scrutinising the budget. He emphasised that the same level of
financial information, as previously provided, was maintained in
this year’s process. He commented on the need to take into
account the current new way of virtual working in presenting budget
information. In the past there would have been physical papers to
examine and more face-to-face meetings and the new experience may
have contributed to this view of the need for increased
information. It was important to note that the same information
that had been provided to Cabinet, had also been provided to
Scrutiny Members. In addition, the Cabinet Member himself , the
Director of Finance and senior finance colleagues had attended the
budget meetings and answered questions. However, going forward, the
Council could look to improve upon the Scrutiny budget process,
which was hopefully not in pandemic situation.
The Cabinet Member noted that
all Councillors were elected to look after the interests of
residents and he would consider some of the points made by Cllr
Connor, in terms of the responses to the Scrutiny recommendations,
and where the Council were able to deal with them, they
would.
There was a need to consider
that the Council were operating in very difficult financial
environment where the government were not providing the Council
with the adequate funding for reimbursement of required spending in
the pandemic.
In responding to the issues
raised on the scrutiny recommendations on Sunday parking charges,
the Cabinet Member for Transformation, Public Realm and investment,
advised that the template provided for response only enabled a
short answer. Cllr Chandwani commented that parking was covered by
the Road Traffic Act and there was a requirement to complete a
statutory consultation. However, the Council were ensuring that
they were working closely with the business support team with the
implementation to ensure that there was not a contradiction of the
efforts to support the economic challenges being faced. The Cabinet
Member thanked the panel for raising this issue and it was an issue
that the service was conscious of and was happy to provide a fuller
response.
In response to a question from
the Cabinet Member for Communities, concerning the current
situation with the Covid funding gap, the Council continued to
receive grants from the government, though not fully funding the
impact on the as a result of COVID-19 spend. There was other
external grant funding received that the Council had distributed,
and this was ringfenced for a particular area i.e., funding for
care homes, business grants schemes so there was not currently a
100% refund of Council spend.
The Cabinet Member for Housing
and Estate Renewal commented that the increased spend on the HRA
was to allow for the delivery of a significant Council house
building scheme and provision of decent homes programme to counter
the lack of investment in previous years which the Council had a
duty to deliver and would mean increased spending. The concerns
about the increased borrowing and spend were acknowledged and
appreciated but there was a responsibility to residents on housing
waiting lists to deliver Council housing and there was a duty to
existing tenants to meet decent homes targets.
There were questions from
Councillors: Brabazon, Gordon, Berryman, Tucker and Palmer with the
following information provided:
- The agreement of the
High Road West scheme in 2017, included reimbursement to the
Council for land assembly costs from the developer. It was further
noted that it was usual for land purchase and land assembly to take
time to complete.
- The Director for
Finance agreed to send a note to Cllr Brabazon responding to the
queries raised about the difference in the capital figures provided
in the Cabinet report to those provided at scrutiny meetings. This
was likely to be related to the context within which the figures
were provided to each meeting.
- In response to a
supplementary question on the costs for assembling the land in HRW
scheme increasing, and the query of whether this was viable for the
third parties to continue in this scheme, it was not felt
appropriate for Cabinet Members and Officers to speculate on this
issue at a Cabinet meeting as these were considerations for the
third parties.
- The High Road West
scheme covered a number of sites, and the Cabinet Member could not
comment on what the potential negotiations would be at the various
stages of the scheme. The sum that was included in the budget and
in the capital, lines was for land assembly and officers would deal
with this at the appropriate time.
- With regards to the
CO2 emissions from any demolition of blocks for new homes in HRW
scheme, the Council had a CO2 strategy, and this issue would be
discussed with Councils departments. Their advice would be taken
into account when this phase of building the replacement blocks was
reached.
- The Council budget
included anticipation of a pay rise for staff and this was included
prior to the government announcement of a pay freeze for public
sector staff. There were ongoing negotiations with the trade unions
and if there was a pay freeze, this would have a positive financial
impact on the budget.
- The report contained
a section on the forecast for the CTRS [ Council Tax Reduction
Scheme] and documented the experience of claims over the COVID-19
period. It was noted that the number of pensioners claiming CTRS
had decreased, but the number of working age people claiming CTRS
had increased substantially. The budget was factoring in a
substantial increase in claims for CTRS in the next year and
collection forecasts had been adjusted in view of such payments .
With regards to affordability the government was putting in place
additional grants to help local authorities fund this and this was
expected to cover the increase in claimants for CTRS in the next
year.
- In response to the
acknowledgement of the need to council homes, the Cabinet
Member for Finance and Strategic
Regeneration reiterated the need for
Council investment in social housing and progressive budget for the
benefit of residents.
- With regards to a
decision around the Library service concerning the reduction of
staff and delaying the budget decision on this until a strategy was
in place , there was investment in libraries and the Council were
considering different ways of working in terms of simplification.
With regards to specialist Library staff, they could be redeployed
and retrained. The point of having a libraries strategy was
acknowledged and the Council would ensure a holistic approach is
taken on this . There was a pause on the Wood Green Library
projects as well as other projects in the Wood Green area due to
Covid and new ways of working.
- The Civic Centre
refurbishment were the main works taking place in Wood Green, there
was no choice but to spend money on this grade two listed building.
Therefore, instead of spending money and stand still , it was felt
prudent to invest and bring it into good use. This would support
the strategy of locality working and bring in the community to use
the building. The reprofiling of the budget, which was a method
used by local authorities, allowed this type of investment and
spend. This was within local government finance regulations and met
with CIPFA requirements. There was also audit of the Council
finances by the external auditors and assurance process. There was
a need to consider investments in schools, housing and Council
buildings to safeguard future use and availability and capital
spend enabled this.
RESOLVED
- To consider the
outcome of the budget consultation as set out in Appendix 8, to be
included in the report to Council. Having taken this into account
this report does not propose any amendment to the Budget for
2021/22 nor to the MTFS 2021/26.
- To approve the
responses made to the Overview and Scrutiny Committee
recommendations following their consideration of the draft budget
proposals as set out in Appendix 9. Having taken this into account
this report does not propose any amendment to the Budget for
2021/22 nor to the MTFS 2021/26.
- To propose approval
to the Council of the 2021/22 Budget and MTFS 2021/26 Budget
Reduction Proposals as set out in Appendix 2.
- To propose approval
to the Council of the 2021/22 General Fund Revenue Budget as set
out in Appendix 1, including specifically a General Fund budget
requirement of £249.077m, but subject to final decisions of
the levying and precepting bodies and the final local government
finance Settlement.
- To propose approval
to the Council of the General Fund Medium Term Financial Strategy
(MTFS) 2021-2026 as set out in Appendix 1.
- To propose approval
to the Council that the overall Haringey element of Council Tax to
be set by London Borough of Haringey for 2021/22 will be
£1,441.04 per Band D property, which represents a 1.99%
increase on the 2020/21 Haringey element and with an additional 3%
for the Adult Social Care Precept amount.
- To note the Council
Tax Base of the London Borough of Haringey, as agreed by the
Section 151 Officer under delegated authority (Article 4.01(b),
Part 2, of the Constitution), as 76,544 for the financial year
2021/22.
- To propose approval
to the Council of the 2021/22 Housing Revenue Account budget as set
out in Table 9.4.
- To propose approval
to the Council of the Housing Revenue Account Medium Term Financial
Strategy (MTFS) 2021-2026 as set out in Table 9.4.
- To approve the
changes to the rent levels for residents in temporary
accommodation, Council tenants in General Needs,
Sheltered/Supported, and Affordable homes reflecting the recent
rent guideline requiring Councils in England to increase rent by no
more than the Consumer Price Index (CPI) at September of the
previous year plus 1%. This will increase the average weekly rents
as set out in Tables 9.1 and 9.2.
- To agree the changes
to service charges to tenants as set out in Table 9.3.
- To approve that the
18 currently Affordable properties, shown in Table 9.2, be changed
to Social Rents from 5 April 2021.
- To propose approval
to the Council of the 2021/22 – 2025/26 General Fund capital
programme detailed in Appendix 4.
- To propose approval
to the Council of the 2021/22 – 2025/26 Housing Revenue
Account (HRA) capital programme detailed in Table 9.5.
- To propose approval
to the Council of the Capital Strategy detailed in Section 8 of
this report.
- To propose approval
to Council of the strategy on the use of flexible capital receipts
to facilitate the delivery of efficiency savings including
capitalisation of redundancy costs (Appendix 6).
- To propose to the
Council the Dedicated Schools Budget (DSB) allocations for 2021/22
of £278.755m as set out in Appendix 7.
- To note the funding
to be distributed to primary and secondary schools for 2021/22
based on the figures advised to Schools Forum and submitted to the
Education Funding Agency in January 2021 set out in Section
10.
- To note the budgets
(including the use of brought forward DSG) for the Schools Block,
Central Services Block, High Needs Block and Early Years Block as
per Appendix 7.
- To delegate to the
Director of Children Services, in consultation with the Cabinet
Member for Children, Education and Families, the power to amend the
Delegated Schools Budget to take account of any changes to
Haringey’s total schools funding allocation by the Education
and Skills Funding Agency.
- To delegate to the
Section 151 officer, in consultation with the Cabinet Member for
Finance, the power to make further changes to the 2021/22 budget
proposals to Full Council up to a maximum limit of
£1.0m.
Reasons for decision
The Council has a statutory
requirement to set a balanced budget for 2021/22 and this report
forms a key part of the budget setting process by setting out the
forecast funding and expenditure for that year. Additionally, in
order to ensure the Council’s finances for the medium term
are maintained on a sound basis, this report also sets out the
funding and expenditure assumptions for the following four years in
the form of a Medium-Term Financial Strategy.
Alternative options considered.
The Cabinet must consider how
to deliver a balanced 2021/22 Budget and sustainable MTFS over the
five-year period 2021/26, to be reviewed and ultimately adopted at
the meeting of Full Council on 1st March 2021.
Clearly there are options
available to achieve a balanced budget and the Cabinet has
developed the proposals contained in this report after determining
levels of both income and service provision. These take account of
the Council’s priorities, the extent of the estimated funding
shortfall, estimated impact of Covid-19, Brexit and the
Council’s overall financial position.
These proposals reflect
feedback received as part of the consultation both externally and
through the Overview & Scrutiny process and the outcome of the
Equalities impact assessments.