Report of the Director of Finance and Assurance.
The Panel received a report of the Director of Finance and Assurance which set out the Council’s proposals for the draft Revenue Budget and Medium Term Financial Strategy 2014/15 to 2016/17 and also the Draft Capital Programme 2014/15 to 2017/18 for consultation.
The Director of Finance and Assurance highlighted the following aspects of the report:
· the impact of the Government’s Comprehensive Spending Review had had been challenging for local authorities. There had been a 28% cut in government funding for local authorities up to 2014/15 and the Government’s austerity programme was expected to continue until 2018/19;
· the reduction in government funding had increased pressures on local authorities’ ability to fulfil their statutory responsibilities, such as caring for young people and vulnerable adults;
· Harrow received one of the lowest grant funding settlements in London and consequently Council Tax in Harrow was relatively high to enable it to fulfil all its statutory duties;
· a two-year budget for 2013/15 had been agreed in February 2013. Harrow’s Corporate Priorities, which were to ‘Deliver a cleaner, safer and fairer Harrow’, were core principles of the budget setting process;
· savings and growth items had been reviewed to ensure that the budget was robust and appropriate adjustments had been made following the review. A funding gap of approximately £20m for 2015/16 and approximately £19m for 2016/17 was anticipated as government grants to local authorities continued to reduce in the future;
· repercussions of the Government’s Welfare reforms had also been factored into the budget and it was anticipated that there would be increased pressures in the areas of Adult social care and Children’s Services;
· there were also a number of inflation related pressures;
· the Government’s freeze on increases in Council Tax meant reduced income for local authorities, however, this would be mitigated by the 1% Council Tax Freeze Grant from central government;
· Business Rates, which were set nationally and not by local authorities, had also been capped at 2%;
· a four-year Capital budget was being proposed for approval in 2013/14 and a £250m investment programme for Public Realm was planned;
· the Children and Families Directorate was delivering savings through innovative and flexible working. The Environment and Enterprise Directorate had seen substantial growth in parking income. Greater efficiencies in the Resources Directorate and the deletion of the Chief Executive’s post would provide additional savings.
RESOLVED: That the report be noted