Agenda item

To follow

The Committee was presented with the Final 2024-25 Budget and 2024-29 Medium Term Financial Strategy report. John Warlow, Director of Finance introduced the report as set out in the agenda pack. 

The following was noted in discussion of this item:

• There was a £16.3m budget gap in the December Draft General Fund Budget. Considerable further work had been undertaken to identify additional savings and actions to close the gap. Consequently, the budget position had improved by c. £10.4m since December.
• The Council was required to draw-down £5.9m from the Strategic Budget Planning Reserves in order to set a balanced budget for 2024/25.
• Haringey had been a poorly funded local authority by the government for many years.
• It was noted that there had been updates on inflation and treasury assumptions.
• Extensive work had been done to further reduce the capital for the General Fund of just under £29m which was an overall reduction in the Capital Programme.
• Since considering the report previously, there was some improvement in the latter years of the forecast. The Housing Revenue Account had increased by around £1m in year four or five.
• The Committee noted that the figures may change again before this was submitted to the Full Council as there was a wait for the final local government settlement figures.
• In response to a question from the Committee regarding building reserves, Officers advised that in order to maintain and build reserves, the Council should ensure that funds were not drawn from these reserves. However, this would be challenging and there would be a need to have high level of financial improvement.
• In response to a question from the Committee, Officers clarified the Capital Programme had been revised and included reduction. These items included primary schools, repairs, maintenance, Pendarren house, borough roads, parks, asset management, active life in parks, parking, walk bridges, place making and housing, Tottenham Hale green space and Council building.
• Officers added that it was difficult exercise to identify areas on where and how the Capital Programme could be reduced.
• It was noted that the new build developments were assumed to be self-financing through extra income streams.
• The Budget/MTFS report in March 2023 forecasted a gap for 2024/25 of c. £6.3m. The draft Budget presented to Cabinet on 5 December 2023 had a gap of £16.3m. The December gap had reduced to £5.9m which was proposed to be met from the Strategic Budget Planning reserve. Further work had been carried out to ensure the reductions which included corporate changes along with corporate growth. The corporate changes included treasury income improvements, reduction in inflation, improvements in the Council tax position, changes in grants, empty properties change and finally, the work done by each Directorate and portfolio holders in bringing forward savings. 
• In terms of reserves, the Committee noted that there was a small number of usable reserves which would give the Council £23million worth of availability. This included the General Fund and the £7million annual contingency fund.
• The Committee recommended that the budget would need to be looked at as a whole by reviewing other elements that make up the budget and not primarily focusing on savings.
• To follow up, the Committee was advised that forward facing savings were a small proportion of the savings that the officers had worked on as management actions, reorganisations, and staffing changes. These savings were estimated to be around £4million since the December Cabinet report. Officers informed the Committee that this figure was a rough estimate and could change as an impact of corporate change factors that may come along, but currently these figures would be a working assumption.
• In response to a question, Officers advised that the Public Health Grant had been moved from corporate grant into Adults directories. The Committee noted that the tables in the report under Funding Assumptions had been amended to reflect this change.
• The Committee highlighted that the updated table on Table 7.1b – Total New Growth was missing £1million in the total figures and queried whether this was a presentational error or if there had been a £1million of new net growth that was proposed in December that was no longer being proposed. The Committee recommended that Officers provide a clear explanation for this at the Cabinet meeting.
• In response to a question regarding a reduction of £0.5m to the regeneration budgets, Officers advised that work had been done to ensure that there would be enough money to maintain the estates to keep it safe and operational. Whilst there was a reduction overall across the three years, there would be wider reviews on estates in general. Officers also advised that the service had sufficient funding for the programme of works that were scheduled for the next year.
• The Committee highlighted that there had been no changes in the figures presented on the tables for this report since the Cabinet in December, and why changes that had been discussed were not being reflected in the report. In response to this, Officers advised that revenue impact had been built into the MTFS and this included a reduction in the cost of debt and an improvement of around £1m and this is included in the report in table 7.3. Officers added that the treasury limits figures had not been altered as a result of timings and the figures were seemed as being reasonable and appropriate as it was not considered to have material impact.
• In response to a question regarding Parkland Walk Bridges, Officers advised that the changes included spreading the cost of investment over a longer period of time in order to reduce borrowing costs. It was also noted that there was no indication of final costs as the consultation is still ongoing.
• In terms of Equalities Impact Assessment (EQIA) for library services, the service was carrying out a detailed approach for each individual library as the needs of the residents in the East and West of the borough are very different. The Committee was assured that the libraries would be protected and was looking at ways to safeguard them for the future, examine ways to generate income and ensure that libraries are public assets.
• The Committee emphasised that the EQIA would need to happen in the libraries before any changes to the library service are proposed.
• In terms of hard copy newspapers and magazines in libraries, some of the feedback seen in the consultation response was very mixed. There were some residents who were very against this and some who thought this would be a reasonable thing to do in terms of environmental impact. The feedback was considered and there was a review in footfall and the number of hard copies in the libraries. Some would be retained, but there would be some savings made, this is why the continuing saving of £25k was in the budget.
• The Committee sought further clarification on Appendix 3A, Officers advised that the descriptors of the savings that were shown in Appendix 3A were unchanged from the version that went out in the original report and this was done for consistency. This was particularly useful when receiving feedback from the public about the savings and it was easier to reference the feedback against the narratives that were in the report.
• The Committee noted that the self-service volunteer or community led libraries proposal was not going ahead. The committee was informed that savings would still need to make and the service was looking to develop a library strategy which would focus on income generation and how those buildings could be used different. The Committee recommended that this new proposal would need to be included in the report and updated for Cabinet.
• The Committee was advised that the final budget report would not be presented at the Cabinet meeting but at the Council meeting. It was also noted that the changes made in the library proposal would be made clearer graphically in the report presented to the Council.
• In terms of the Council Tax Reduction Scheme, this would go out for consultation on any changes publicly. It was noted that at this stage the figures were indicative subject to consultation. The changes and benefits expected was due to people transferring over to Universal Credit. Officers added that pensions were protected by legislation and no changes could be made from the 100% that was already being given.

RESOLVED

That the additional Budget Scrutiny recommendations to Cabinet were agreed. These are published in a separate table: https://www.minutes.haringey.gov.uk/documents/b30300/Budget%20Scrutiny%20Recommendations%20from%201st%20February%20meeting%2001st-Feb-2024%2019.00%20Overview%20and%20Scrutin.pdf?T=9