Agenda and minutes

To agree the Council’s procedure rules for remote meetings.

RESOLVED –

THAT the remote meeting procedures set out in the agenda be agreed.

No apologies were received.

To maintain transparency, Members declared that, in relation to Item 8, they all paid Council Tax in Camden. Members decided they would still be able to discuss the report impartially, and as a Scrutiny Committee, they were not considering the report in a decision-making capacity.

Broadcast of the meeting

The Chair announced that the meeting was being broadcast live by the Council to the Internet and could be viewed on the website for six months after the meeting. After that time, webcasts were archived and could be made available upon request. Those who had asked to address the meeting were deemed to be consenting to having their contributions recorded and broadcast and to the use of those sound recordings and images for webcasting and/or training purposes.

No deputations were received.

There was no such business.

To approve and sign the minutes of the meeting held on 16 November 2020 and 14 December 2020.

RESOLVED –

THAT the minutes of the meetings held on 16^th November 2020 and 14^th December 2020 be approved as a correct record.

Report of the Cabinet Member for Finance and transformation.

Camden continues to operate in unprecedented times. Since the start of the coronavirus pandemic, the Council has moved swiftly to mobilise our staff, our partners and our communities to provide a vital safety net, ensuring that people have the support that they need and are able to stay at home to prevent the spread of covid-19.

Inevitably, the pandemic is having a significant impact on our financial position. In 2020/21, we are currently anticipating a net financial pressure of £9.1m after government funding support and the financial impact will almost certainly be felt into 2021/22. At present, it is incredibly difficult to provide a definitive assessment of what this could be and much depends on the length and depth of the pandemic and its long-term impact on the economy and the Government’s long term public spending.

Against such an uncertain backdrop, Camden continues to be challenged by a tough financial environment. This report sets out the detailed budget for 2021/22, including a series of proposals to ensure a balanced budget. The detailed budget aligns with the overall Medium Term Financial Strategy agreed by Cabinet in December 2018 that not only sought to ensure that the Council could continue to operate on a sound financial footing over the medium term, but also to align the Council’s limited resources to achieving the ambition for our borough, residents and communities as set out within Our Camden Plan. The recommendations in this report will support the vision of Camden 2025 to make Camden a place where everyone has a chance to succeed, where nobody gets left behind, and where everybody has a voice.

Consideration was given to the report of the Cabinet Member for Finance and Transformation. The report was introduced by the Head of Finance (Corporate Services).

In response to key questions from Members, the Head of Finance (Corporate Services) and Executive Director Corporate Services gave the following responses:

·       Camden expected that economic recovery from the pandemic would begin in the next financial year but the exact timing was difficult to predict. 

·       The Government had announced financial support for additional COVID-19 pressures for the first three months of the 2021/2022 financial year. Camden anticipated receiving one further cash grant as part of this. The Government also had a scheme to, partially, reimburse local authorities for income lost due to COVID-19.

·       As part of managing risks, Camden not assumed any of the Government’s support in the base budget. Instead, any grants would be put to one side and used as and when financial pressures materialised.

·       Council Tax would increase though there were accounting assumptions that Council Tax collection would decrease. If Camden were to pessimistic with their collection estimates, the Council Tax collection fund would run a surplus next year.

·       It would be a decision for the Council Members as what to do with any surplus in resources.

·       In terms of other Council’s assumptions on collection rates most fell within a 5-6% percent range of each other.

·       Whilst the decisions were still being taken by other Local Authorities, many had agreed to increase Council Tax by the maximum amount.

·       Referring to page 40 of the report, The Head of Finance agreed to provide information to Members about the £0.5m the Council was investing to improve resident participation.

Action by: Head of Finance (Corporate Services).

·       Through the London Business Rates Pool, Camden had retained around £9m more in business rates than it would have normally over a three-year period. A decision to pause Camden’s participation in the pool was made, as there had been a shift in the risk and reward with tax levels. At the moment the risks outweighed potential rewards for next year.

·       Customer Service teams, like those who dealt with Council Tax and Business Rates, had been working on the COVID-19 response. As a result of this, Medium Term Financial Strategy savings projects had been delayed in those areas.

·       Where appropriate, action would be taken to collect any Council Tax not collected this financial year.

·       Officers recognised that many people had been negatively impacted, financially, by the pandemic. There had been a large increase in the uptake of the Council Tax support scheme, with £2.8m more being spent on scheme.

·       The wellbeing and resilience of Camden’s workforce was always an important consideration. A balance had to be sought between responding to the increase in demand on the services whilst continuing to operate within the financial means of the organisation.

·       The original suggestion was to have a 5% vacancy factor had been reduced to 2.5%, in response to challenges and previous discussions.

·       Vacancy factors were common among other local  ...  view the full minutes text for item 8.

Report of the Cabinet Member for Finance and Transformation.

This report sets out the annual update of the Treasury Management Strategy for 2021/22 including the Borrowing and Investment Strategies.

Camden continues to operate with an unprecedented backdrop of the coronavirus pandemic. To manage the uncertainty of the financial environment in which it is operating, the Council maintains high levels of liquidity (cash) to ensure the Council’s financial obligations can be met. However, the Council’s treasury function has seen a significant change to its operating environment, with interest rates at an all-time low and heightened financial stress of counterparties used to manage the council’s investments.

This report provides a perspective on the management of investments of £278m, which includes investing up to £100m on behalf of the North London Waste Authority (NLWA) and debt of £329m, and updates on external factors that impact the future treasury management plans of the Council.

In summary the report:

·       Presents the current economic background and outlook for interest rates which inform the operating environment for the Council’s investment and borrowing strategies.

·       Summarises the Council’s capital expenditure plans and forecast capital financing requirements, and considers long term borrowing needs.

·       Proposes a continuation of the existing borrowing strategy using internal borrowing to reduce costs. No existing debt is maturing in 2021/22 and the Council does not plan to take on any new borrowing in the immediate future and this will minimise debt costs and is the most efficient way to approach borrowing.

·       Proposes the investment strategy for the coming year, with no change to the minimum credit rating criteria for investments, maintaining the focus on investment security and very high credit quality. Limits on the three AAA rated Money Market Funds we use will be increased from £100m to £150m and this will enable the Council to make use of these very secure investments with same day liquidity. There is no increase in our risk exposure from the recommendations in this strategy.

The report is coming to Cabinet and Council because it is a Chartered Institute of Public Finance and Accountancy (CIPFA) requirement for the Treasury Management Strategy to be agreed by those committees.

Consideration was given to the report of the Cabinet Member for Finance and Transformation.

The report was introduced by the Head of Treasury and Financial Services, who made the following comments in response to questions from the Committee:

·       Of the £275m investment balances, £5m was invested in other local authorities. Camden had reduced confidence in the investments in local authorities and instead were investing more widely in money market funds.

·       Camden was not taking on the North London Waste Authority debt on its own books but this debt was recorded on behalf of NLWA in its own right; all investment and debt presented in this report related to the Council’s financial affairs.

·       Responding to a Member question about the estimated increase in capital expenditure in the 2021/2022 financial year, the Head of Treasury and Financial Services said that this was, in part, because of the Town Hall renovation. However, he would need to talk to capital accountants for more detail and follow up to the committee in an email.

Action By: the Head of Treasury and Financial Services.

·       The Government set the Housing Revenue Account (HRA) debt cap based on notional calculation. The current level of debt was affordable.

·       The rescheduling of debt was possible but significant fees for repaying the debt early would be incurred.

The committee thanked Nigel Mascarenhas for his work as the Acting Director of Finance.

RESOLVED –

THAT the report be noted.

This report provides a review of progress of Camden’s Community Investment (CIP) Programme as at the end of 2020. This is the second CIP Annual report and the intention is to bring an update to the relevant Scrutiny Committees every year.

The report provides an update on delivery of new homes, schools and community facilities through Cabinet approved schemes, the financial position of the programme including progress in selling homes to help fund our investment and progress in developing new proposals.

Consideration was given to the report of the Director of Development.

The report was introduced by the Cabinet Member for Investing in Communities, Culture and an Inclusive Economy and the Director of Development.

In response to key Member questions, they made the following comments:

·       There was an opportunity for changes to be made to the report before it was published.

·       The report was also going to the Housing Scrutiny Committee and so, questions that were housing related could be raised at that meeting.

·       The Director of Development agreed to include a delivery programme on each of the projects in the report, including an update on them.

Action By: Director of Development

·       Income generated from assets was not included in the budgets until the income was being received.

·        Whilst accepting that some delays from projects can be beneficial in the long term, a Member asked whether the figures in the report incorporated knock-on costs that may be caused by delays. The Director of Development agreed to look into compiling figures that included all costs caused by delays and bring the findings to the CIP panel.

Action By: Director of Development

·       The scale of housing need was significant in Camden. The Council needed to look at other delivery models if it was going to meet housing need.

·       The Director of Development agreed to look at the figures around market rent properties and ensure they were the most recent and inclusive of the pandemic. He also agreed to bring a Camden Living business plan update to the committee.

Action By: Director of Development

·       A Member raised that the Capital Review expenditure had been stated at £396m in last year’s report, this year it had decreased to £395m. The Director of Development agreed to clarify this difference for the Committee.

Action By: Director of Development

·       A Member suggested that, in future reports, the result achieved with CIP should be shown in wider London context.

·       There was concern over the government’s intended changes to planning rules and changes to the Community Infrastructure Levy (CIL). Camden was lobbying government over the changes and the risk they could bring to the programme.

·       Camden were aware of impact works could have on local neighbourhoods and sought to create improvements to the areas where developments were built.

·       Unit costs and build costs were being taken to the CIP panel; it would be difficult to extrapolate these from the figures in the report.

·       The schools projects were funded through general fund.

·       The Director of Development agreed to bring an update to the Committee on disposals and land costs.

Action By: Director of Development

·       Have some broad sense, given uncertainty and conditions, on when delivery on the housing target.

·       Lessons had been learned from the William Ellis and Parliament Hill projects about better budget setting for projects. For the William Ellis and Parliament Hill projects the early budget based was on limited design information.

·       A piece of work, being led by the Cabinet Member for Better Homes, was  ...  view the full minutes text for item 10.

There was no such business.