DECISION

1.    To note the updated draft MTFS for 2021-22 to 2023-24, taking account of draft savings and growth business cases and a revision to the income assumptions (Council Tax and Business Rates) proposed since the last MTFS report to Cabinet on 29 July 2020.  If these were all agreed at the current values proposed, the estimated budget gaps before use of one-off reserves would become £7.8m (21-22), £19.1m (22-23) and £10.9m (23-24). 

2.    To propose the use of reserves on a one-off basis to balance the budget in 21-22 in the sum of £7.8m (£6.5m of which is the pre-planned drawdown from the Council Tax smoothing reserve) and agree a further contribution from reserves in 22-23 in the sum of £8.2m to smooth the budget deficit over the medium term.

3.    To note the need to set a balanced budget for 2021-22, the aspiration to also set a balanced budget over the rest of the three year MTFS period and that prompt and decisive action is required urgently to address the challenging financial position as highlighted by the budget gaps.

4.    To agree that:

a) further review work should continue on the draft savings proposed to date, and;

b) officers should continue to identify further savings opportunities for consideration to fully meet the estimated budget gap over the next three years.

5.    To propose that the Council Tax rate for 2021-22 will be increased by 1.99% general rate increase and an additional 3.00% Adult Social Care precept, totalling 4.99%.

6.    To propose that the Key Stage Two extension to the Free School Meals programme will be funded throughout the three years of the MTFS by £2m per annum from reserves (reserves supplemented by additional New Homes Bonus in 21-22) and continuation of the £1m per annum funding through the Public Health grant.

7.    To propose the growth proposal of £771k per annum for three years’ investment in additional police officers in the borough under Section 92 of the Police Act 1996 (Grant from a Local Authority) with the Mayor’s Office for Policing and Crime (MOPAC) using the revised Met Partnership Plus scheme; and,

8.    To propose to delegate authority to the Corporate Director Health, Adults and Community, in liaison with the Corporate Director Resources, to execute the necessary agreement with MOPAC and Tower Hamlets Police – Basic Command Unit for Central East.

9.    To agree an average housing rent increase of 1.5% based on the September 2020 Consumer Price Index plus 1% to take effect from the first rent week of April 2021. This equates to an average rent increase of £1.23 per week for 2021-22.

10.To agree that the average weekly housing tenanted service charge will increase by 1.5% from the first rent week in April 2021. This is consistent with the new Social Housing rent standard rent policy and will lead to an average weekly increase in tenanted service charges of approximately £0.57.

11.To note that the Local Council Tax Reduction Scheme will remain unchanged for 2021-22.

12.To note the following matters:

The General Fund revenue budget for 2021-22 and MTFS 2021-22 to 2023-24

The initial budget proposals and Council Tax for 2021-22 together with the MTFS set out in Appendix 1.

Funding

The funding available for 2021-22 and the indications and forecasts for future years as set out in Sections 3.3 and 3.5.

Growth and Inflation

The risks identified from the potential growth and inflation commitments arising in 2021-22 and future years as set out in Section 3.6 & Appendix 3.

Savings

New proposed saving items to be delivered in 2021-24 as set out in Section 3.7 and Appendix 4.

Financial Risks and Opportunities

The strategic budget risks and opportunities as set out in Section 3.8.

Reserves

The reserves policy and proposed approach to the strategic use of reserves as set out in Section 3.9 and Appendix 5.

Schools’ Funding

The position for schools’ funding including the Dedicated Schools Budget as set out in Section 3.10.

Housing Revenue Account

The proposals for Housing Rent and Tenanted Service Charge Setting 2021-22 are set out in Section 3.11.

13.To note the Equalities Impact Assessment (EIA) and specific equalities considerations as set out in Section 4 of the report.

Action by:

INTERIM CORPORATE DIRECTOR, RESOURCES (K. BARTLE)

(Interim Divisional Director, Finance, Procurement and Audit (H. Jolapara)