Agenda item

Report of the Cabinet Member for Finance and Cost of Living.

Continued reduction in Government funding for the Council, coupled with rising inflation and cost pressures on our services means that the Council is projecting a budget deficit of approximately £40m by 2025/26. This report presents an overview of the Council’s financial position and our plan for providing financial stability and resilience for the local authority in a volatile wider environment.

This report sets out our assumptions and our understanding of how Government policy will impact our funding and spending over the coming years including updates from the Autumn / Winter 2022 spending review and the Local Government Finance Settlement that allocates funding to each local authority.  The recent draft financial settlement for 2023/24 provided an increase in ‘Core Spending Power’ (funding available for local authority services, which is predicated on a combination of government grants and increasing Council Tax and locally retained Business Rates) of 9.2% across England.  In Camden approximately 28% of the increase in ‘Core Spending Power’ relates to an assumed increase in Council Tax of 4.99%. Camden’s specific core spending allocation was lower than the national average and the fourth lowest in London at 8.2%.  This is against general inflation of 10.1% and ongoing demographic pressures in a number of services especially adult and children’s social care.

The report sets out our proposals for how we will change our organisation and our services to operate within our expected budgets in the medium term. These proposals incorporate outcomes-focused change, a focus on long-term change for improvement for the Council, and a continuing drive for the best and most efficient services. These proposals are detailed at Appendix A.

This report also sets out how we will invest our resources and direct our services to support our ambitions for Camden set out in We Make Camden – our community vision for Camden as a fairer, more equal, more just and more sustainable Borough. This includes how we are investing resources to support families and households through the cost of living crisis, to address the harm of poverty and to support families to have economic security. It shows how we are continuing to play our part in climate justice and supporting Camden’s transition to be a low-carbon community. It shows how we are continuing to invest to give children and families the best start, and how we are investing to provide person-centred care for people with health and complex needs – and how we are working in our neighbourhoods to keep people healthy and well.

Some of our proposals for achieving financial stability will have an impact on staff, on residents and on the way that services are delivered. All proposals have been considered individually for their potential impact on residents as part of our commitment to equity. There is an overarching equalities impact assessment for this financial strategy included in this report. For those proposals that require consultation and/or equality impact assessments to be considered, whilst the associated budget reductions are being decided now, the final decisions on how or whether to implement those specific savings will be made at a later date through delegation to relevant Directors or through a further decision by Cabinet. The  findings of the relevant equality impact assessments will be considered at this time and will inform the decision on whether to implement those specific savings. There are also some proposals that are ready for immediate implementation that do not require consultation and/or equality impact assessments. The decision sought for each proposal is set out in Appendix 1.

This report also provides an update on:

·       Reserves and balances position including planned use

·       2023/24 budget setting considerations

·       Additions to the General Fund Capital Programme

·       Recommended Fees & Charges for 2023/24

Consideration was given to the report of the Cabinet Member for Finance and Cost of Living, who introduced the report.

The Committee made the following comments in their discussion of the report:

·       In regard to licensing efficiencies, a Member asked if the Evening and Night Time Economy review could be used as way of informing how those efficiencies are implemented. The Cabinet Member agreed to this approach.

·       With reference to the recent joint DMC meeting and resident feedback, a Member asked about whether further increasing garage rents could be used as a way of increasing revenue. The Director of Finance responded that conversations were being had to explore whether this was an option that could be taken forward.

·       Members asked if there would be any negative aspects to holding a vacancy factor. The Director of Finance said the there would be minimal negative implications to this approach and, where needed, exceptions would be made.

·       A Member commented about the level of detail given for individual projects in the report. The Executive Director reassured the Committee that each proposed project had been checked and examined by Camden’s legal team.

·       In response to a Member question, the Head of Finance commented that tracking business rates was difficult as there had been a change to the pattern of payments. Whilst Camden were behind with the patterns of payments, due to government rate relief for businesses, they had actually already collected more than in previous years.

·       Members were concerned with the future financial climate and the impact this could have on Camden. The Cabinet Member said that the Camden had a good track record of meeting their savings goals, however, the Council’s financial reserves were at the lower end of what they are comfortable with and so there was a drive to increase reserves.

RESOLVED –

THAT the report be noted.