To consider the revised proposals of the Mayor and Executive in relation to the Council’s Budget and Council Tax 2014/15.

The first Budget Council Meeting on 26^th February 2014 agreed a substantive motion that included an amendment to the Mayor’s budget proposals. In accordance with the requirements of the Constitution and statutory provisions, the Mayor has been formally advised of the changes agreed by the Council and within a period of five working days must reconsider his budget proposals in accordance with those and submit his final budget proposals to the second Budget Council Meeting.  Those revised proposals may at the Mayor’s discretion include some or all of the changes agreed by the Council at the first budget meeting.

The attached report sets out the revised budget amendment adopted by the Council on 26^th February 2014.  The Mayor’s revised budget proposals will be circulated to Councillors as soon as they are available.

Officer advice on the Mayor’s budget proposals and on each element of the agreed budget amendment has been received by Members in the agenda for the first Budget Council Meeting and the papers tabled at that meeting.  Members are requested to bring the Budget Council Pack and tabled papers with them to the meeting.  

Mayor Lutfur Rahman introduced, and Councillor Alibor Choudhury moved, the budget proposals of the Mayor and Executive as set out in the tabled report. Councillor Ohid Ahmed seconded the proposals. The Mayor stated that he and the Executive were unable to accept any of the amendments proposed by Council on 26^th February 2014, with the reasons set out in the tabled report.

Councillor Carlo Gibbs moved and Councillor Sirajul Islam seconded, the Council’s amended budget proposals as set out in the agenda.

Following debate a recorded vote was conducted on the Council’s amended budget proposals.  The amendments did not achieve the necessary two-thirds majority of those present and voting as required by regulations, with 22 Members voting in favour, 18 against and 6 abstentions.  The Mayor and Executive’s budget proposals were therefore adopted.

DECISION

General Fund Revenue Budget and Council Tax 2014/15; Capital Programme and Medium Term Finance Plan 2014-2017; Treasury Management Strategy Statement, Minimum Revenue Provision Policy Statement and Annual Investment Strategy 2014/15

1.         To agree a General Fund revenue budget of £293.933m and a total Council Tax Requirement for Tower Hamlets in 2014/15 of £66,396,000 as set out in the table below.

2.         To agree a Council Tax for  ...  view the full decision text for item 5

The Mayor’s response to the budget amendments agreed by the Council at the Budget Meeting on 26^th February were tabled.

Mayor Lutfur Rahman introduced, and Councillor Alibor Choudhury moved, the budget proposals of the Mayor and Executive as set out in the tabled report. Councillor Ohid Ahmed seconded the proposals. The Mayor stated that he and the Executive were unable to accept any of the amendments proposed by Council on 26^th February 2014, with the reasons set out in the tabled report.

Councillor Carlo Gibbs moved and Councillor Sirajul Islam seconded, the Council’s amended budget proposals as agreed at the meeting on 26 February 2014 and set out in the agenda.

During debate, Councillor Rachael Saunders moved and Councillor Bill Turner seconded a procedural motion ‘that under Procedure Rule 15.11.4, the question be now put’.  The procedural motion was put to the vote and was defeated.

Following further debate the Council’s amended budget proposals were put to the vote. They did not achieve the necessary two-thirds majority of those present and voting as required by the regulations, with 22 Members voting in favour, 18 against and 6 abstentions as set out below:-

The Mayor and Executive’s budget proposals were therefore adopted.  Accordingly it was:-

RESOLVED

General Fund Revenue Budget and Council Tax 2014/15; Capital Programme and Medium Term Finance Plan 2014-2017; Treasury Management Strategy Statement, Minimum Revenue Provision Policy Statement and Annual Investment Strategy 2014/15

1.         To agree a General Fund revenue budget of £293.933m and a total Council Tax Requirement for Tower Hamlets in 2014/15 of £66,396,000 as set out in the table below.

To consider the proposals of the Mayor and Executive for the Council’s Budget and Council Tax 2014/15.

Mayor Lutfur Rahman introduced, and Councillor Alibor Choudhury moved, the budget proposals of the Mayor and Executive as set out in the agenda pack. Councillor Ohid Ahmed seconded the proposals.

Three amendments were tabled and moved as follows:

(i)    Amendment proposed by Councillor Carlo Gibbs and seconded by Councillor Sirajul Islam.

(ii)  Amendment proposed by Councillor David Snowdon and seconded by Councillor Zara Davis.

(iii)Amendment proposed by Councillor Peter Golds and seconded by Councillor Tim Archer.

Following debate the amendment proposed by Councillor Carlo Gibbs was put to the vote and was agreed.

The amendment proposed by Councillor David Snowdon was put to the vote and was defeated.

The amendment proposed by Councillor Peter Golds was then put to the vote and was defeated.

The substantive budget proposals as amended were then put to the vote and were agreed. 

DECISION

That the Mayor and Executive be informed of the Council’s objections to their budget proposals as set out in the decision below; be requested to reconsider their proposals in the light of those objections; and in accordance with the Budget and Policy Framework Procedure Rules submit revised proposals for consideration at a further Budget Council Meeting to be held on 6^th March 2014.

Foreword:

·         The ConDem Government continues in its ideological austerity drive hitting the most deprived communities such as ours the hardest. Whilst local councils face difficult decisions in the years ahead, strong, honest and fair leadership is required to ensure the most vulnerable are protected and services continue to serve residents’ needs.

·         The emptiness of this year’s budget proposals from the Mayor shows that Lutfur Rahman has run out of ideas and has no plan to lead the borough through this difficult financial time.

·         When John Biggs wins the Mayoralty in May we will be able to set about making the changes necessary to deliver the services residents rightly demand. Until then we need to send a clear message about the kind of administration we would lead.

·         This Budget amendment starts to set out the progressive things that a Labour administration under John Biggs would seek to achieve. This includes;

1.                  Free School Meals for all primary school children;

2.                  A 24h weekend noise  nuisance and ASB reporting service;

3.                  Action to tackle drug dealing;

4.                  A private lettings service to cut out rip off charges and powers to hold RSLs to account;

5.                  Utilising the council's capacity to build council housing;

6.                  Funding to restore our much loved parks including bringing back the popular Victoria Park firework display.

7.                  Cutting the Mayor's excessive spending on cars, advisors and communications;

This Council believes:

·         The budget deficit in 2015/16 stands at £28m and in 2016/17 this increases to £67m;

·         The council budget for 2014/15 is not balanced and reserves are being used to cover the shortfall;

·         The Mayor has failed to produce a plan of how he will tackle the deficit.

·         Following years of pressure from Labour Group the Mayor has finally  ...  view the full decision text for item 6

Mayor Lutfur Rahman introduced, and Councillor Alibor Choudhury moved, the budget proposals of the Mayor and Executive as set out in the agenda pack. Councillor Ohid Ahmed seconded the proposals.

Three amendments were tabled and moved as follows:

(i)    Amendment proposed by Councillor Carlo Gibbs and seconded by Councillor Sirajul Islam.

(ii)  Amendment proposed by Councillor David Snowdon and seconded by Councillor Zara Davis.

(iii)Amendment proposed by Councillor Peter Golds and seconded by Councillor Tim Archer.

Additional papers were tabled as follows:-

-       Comments of the Overview and Scrutiny Committee from their meeting on Tuesday 11^th February on the revised budget proposals agreed at Cabinet on 5^th February 2014; and

-       Officers’ amended comments on alternative budget proposal by the Labour Group: Restoration of Victoria Park Fireworks Display

Procedural Motions

During the debate, Councillor Peter Golds moved and Councillor Bill Turner seconded, a procedural motion “that under Procedure Rule 14.1.16 Councillor Alibor Choudhury be not further heard” due to misconduct.

The procedural motion was put to the vote and was agreed.

A second procedural motion was moved by Councillor Ohid Ahmed and seconded by Councillor Oliur Rahman “that under Procedure Rule 14.1.6 Councillor Rachael Saunders be not further heard” due to misconduct.

The procedural motion was put to the vote and was defeated.

A third procedural motion was later moved by Councillor Anwar Khan and seconded by Councillor Rabina Khan “that under Procedure Rule 14.1.6 Councillor Joshua Peck be not further heard” due to misconduct.

The procedural motion was put to the vote and was defeated.

Following debate the budget amendment proposed by Councillor Carlo Gibbs was put to the vote and was agreed.  Councillors recorded their votes on the amendment as follows:-

The amendment proposed by Councillor David Snowdon was then put to the vote and was defeated.  Councillors recorded their votes on the amendment as follows:-

The Mayor noted the tabled paper and the response of the Overview and Scrutiny Committee. He also accepted two amendments, one to provide funding to increase the number of police officers in the borough and a second to increase the Council Tax Support Scheme awards.

DECISION

1.    To agree a General Fund Revenue Budget of £292.358m and a Council tax (Band D) at £885.52 for 2014-2015 be referred to Full council for consideration.

2.    To note the following matters -

a.    Budget Consultation

The results of the feedback for the budget consultation are being collated but could not be completed prior to publication of this report as the second budget roadshow took place on the 27th January 2014.  The results were presented as an addendum to this report.

b.    Funding

The funding available for 2014-2015 and the indications and forecasts for future years set out in Section 8.

c.    Base Budget 2014-2015

The Base Budget for 2014-2015 as £295.732m as detailed in Appendix 1.

d.    Growth and Inflation

The risks identified from potential inflation and committed growth arising in 2014-2015 and future years and as set out in Section 9 and in Appendix 3.

e.    General Fund Revenue Budget and Medium Term Financial Plan 2014-2015 to 2016-2017

The initial budget proposal and Council Tax for 2014-2015 together with the Medium Term Financial Plan set out in Appendix 1 and the budget reductions arising.

f.     Savings

Previously agreed savings items to be included in the budget for 2014-2015 and the strategic approach for future savings to be delivered are set out in Section 10, Appendix 4 and paragraph 7.13 of the report.

g.    Capital Programme

The capital programme to 2016-2017; including the proposed revisions to the current programme as set out in section 14 and detailed in Appendices 8.1, 8.2 & 8.3.

h.    Dedicated Schools Grant

The position with regard to Dedicated Schools Grant as set out in Section 12 and Appendices 6.1 & 6.2.

i.      Housing Revenue Account

The position with regard to the Housing Revenue Account as set out in Section 13 and Appendix 7.

j.      Financial Risks: Reserves and Contingencies

Advise on strategic budget risks and opportunities as set out in Section 11 and Appendices 5.1, 5.2 and 5.3.

k.    Reserves and Balances

The position in relation to reserves as set out in the report and further detailed in Appendices 5.1 and 5.3

l.      Mayor’s Priorities

An initiative (Working Start for Women in Health and Childcare) to be included in the budget for 2014-15 is set out in paragraphs 8.29 to 8.36 of this report and a detailed proforma in Appendix 3.

3.    To authorise officers to present two additional proposals to be submitted as part of the report to be considered at Council:

a.            An initiative to fund an additional 20 police officers for the Borough.

b.            To provide support to low income households who are already entitled to partial council tax support,  by way of a £25 reduction against their remaining council tax liability in 2014/15”

Action by:  ...  view the full decision text for item 10

Councillor Alibor Choudhury, Cabinet Member for Resources, introduced the report. He highlighted a number of issues including:

·         The extremely challenging cuts in government funding.

·         The need to make proper use of the Council’s reserves.

·         The use of funds originally allocated to pay for free school meals that would now be targeted at other areas such as jobs.

·         The proposed programme to support women into health related jobs and training.

·         The need to deliver on the Mayor’s priorities and to protect front line services.

·         The tabled paper on the response to the two budget roadshows the Council had undertaken.

Opening up the item to debate, the Mayor welcomed the report and thanked the Head of Paid Service, the Interim Corporate Director, Resources and all officers and Lead Members for their work in preparing the proposals.

During debate, Councillor Ohid Ahmed, Deputy Mayor, proposed an amendment to provide for additional police officers for the Borough’s streets and the Mayor proposed an amendment to improve the Council Tax benefit scheme with an additional £25 of support to eligible households.

Following further debate, the Mayor noted the tabled paper on the budget roadshows and the response of the Overview and Scrutiny Committee. He also accepted the two proposed amendments, and, subject to the amendments, agreed the recommendations as set out in the report.

RESOLVED

1.    To agree a General Fund Revenue Budget of £292.358m and a Council tax (Band D) at £885.52 for 2014-2015 be referred to Full council for consideration.

2.    To note the following matters -

a.    Budget Consultation

The results of the feedback for the budget consultation are being collated but could not be completed prior to publication of this report as the second budget roadshow took place on the 27th January 2014.  The results were presented as an addendum to this report.

b.    Funding

The funding available for 2014-2015 and the indications and forecasts for future years set out in Section 8.

c.    Base Budget 2014-2015

The Base Budget for 2014-2015 as £295.732m as detailed in Appendix 1.

d.    Growth and Inflation

The risks identified from potential inflation and committed growth arising in 2014-2015 and future years and as set out in Section 9 and in Appendix 3.

e.    General Fund Revenue Budget and Medium Term Financial Plan 2014-2015 to 2016-2017

The initial budget proposal and Council Tax for 2014-2015 together with the Medium Term Financial Plan set out in Appendix 1 and the budget reductions arising.

f.     Savings

Previously agreed savings items to be included in the budget for 2014-2015 and the strategic approach for future savings to be delivered are set out in Section 10, Appendix 4 and paragraph 7.13 of the report.

g.    Capital Programme

The capital programme to 2016-2017; including the proposed revisions to the current programme as set out in section 14 and detailed in Appendices 8.1, 8.2 & 8.3.

h.    Dedicated Schools Grant

The position with regard to Dedicated Schools Grant as set out in Section 12 and Appendices 6.1 & 6.2.

i.      Housing Revenue Account  ...  view the full minutes text for item 10

To consider the General Fund, Capital and Revenue Budgets and Medium Term Financial Plan 2014-2017 in accordance with the Council’s Budget and Policy Framework Procedure Rules.

The Committee considered the report titled ‘General Fund Capital and Revenue Budgets and Medium Term Financial Plan 2014-2017’ that had been presented to Cabinet on 8 Cabinet 2014 and had also been initially considered at the OSC meeting on 7 January 2014. Councillor Alibor Choudhury, Cabinet Member for Resources, and Chris Holme (Interim Corporate Director, Resources) and officers from all departments were present to answer questions from the Committee.

Chris Holme provided a summary presentation to the Committee, he reported that:

·         The savings requirements due to the reduction in the government’s revenue support grant were a significant challenge for the Council.

·         The grant was being cut by 40% between 2013/14 and 2015/16 and then by a further 20% between 2015/16 and 2016/17.

·         In addition to the support grant reduction there were further changes such as a reduction in the New Homes Bonus.

·         Most reductions had been correctly anticipated but the Government’s Autumn Statement had resulted in an unexpected ending of the crisis and support fund grants of £1.7 million a year (£1.4 million in grants and £300k towards administration costs) and a few other changes which resulted in a net additional loss to the Council of around £1 million per year.

·         There would consequently be an updated Budget report presented to February Cabinet where the changes would be set out in more detail but the overall savings assumptions were unaffected.

Councillor Alibor Choudhury concurred with Mr Holme’s introduction and also highlighted that the Council had a balanced budget proposed for 2014/15 and so no further savings needed to be identified for that period but that significant new savings would be required after that.

The Chair opened the item up for discussion and the Committee explored a number of issues to which they sought officer responses, including:

·         The Council’s strategy for using its reserves. It was explained that the reserves would be used to smooth out the impact of the grant cuts but that the Council was committed to maintaining a minimum reserve of around 5-7% of overall spend as that was considered good practice.

·         On why there had been a significant increase in Third Party Payments and what they were for. Chris Holme promised to provide a written response but explained that in many cases it would be because of changes to services, for example, the new public health money would be classed as Third Party Payments.

·         Whether funding was being taken from public health budgets for other projects and whether there had consequently been an impact on service provision. It was explained that there had been no impact on public health service delivery and that the grant was ring fenced at least until 2015/16. However, the Council was looking at administrative efficiencies and new public health initiatives.

·         Whether plans for personalised homecare were still behind schedule and if the Council still directly employed homecare workers. Officers explained that there had been a reduction in directly employed staff due to voluntary redundancies and that work was ongoing on developing personalised  ...  view the full minutes text for item 5

The Mayor agreed the reasons for urgency as set out in the report.

DECISION

1.    To agree a General Fund Revenue Budget of £294.663m together with the Outline Strategic Plan identifying the key priority activities which will be delivered within this budget and which will be further developed into the Council’s Strategic Plan for 2014/2015.

2.    To accept the Council Tax Free Grant available from the Department of Communities and Local Government for 2014/2015 and thereby agree to continue to freeze Council Tax (Band D) at £885.52 for the new financial year.

3.    To agree to propose the items listed below for public consultation and consideration by the Overview & Scrutiny Committee in accordance with the Budget and Policy Framework (Section 16). A further report will then be submitted to the next Cabinet meeting in February detailing the results of consultations and inviting the Cabinet to recommend a Budget Requirement and Council Tax for 2014-15 to Full Council.

4.    To agree to conduct the Budget consultation in line with Section 16 in the body of the report.

5.    To consider and comment on the following matters -

a.            Budget Consultation

The approach to the budget consultation with the community and Overview and Scrutiny Committee.

b.            Funding

The funding available for 2014-2015 and the indications and forecasts for future years set out in Section 8.

c.            Base Budget 2014-2015

The Base Budget for 2014-2015 as £295.732m as detailed in Appendix 1.

d.            Growth and Inflation

The risks identified from potential inflation and committed growth arising in 2014-2015 and future years and as set out in Section 9 and in Appendix 3.

e.            General Fund Revenue Budget and Medium Term Financial Plan 2014-2015 to 2016-2017

The initial budget proposal and Council Tax for 2014-2015 together with the Medium Term Financial Plan set out in Appendix 1 and the budget reductions arising.

f.             Savings

Previously agreed savings items to be included in the budget for 2014-2015 and the strategic approach for future savings to be delivered are set out in Section 10, Appendix 4 and Paragraph 7.12 of the report.

g.            Capital Programme

The capital programme to 2016-2017, including the proposed revisions to the current programme as set out in section 14 and detailed in Appendix 8 and Adopt a capital estimate to the value of £3.55m to facilitate Decent Homes Works on the Malmesbury Estate as set out in paragraph 14.6.

h.            Dedicated Schools Grant

The position with regard to Dedicated Schools Grant as set out in Section 12 and Appendix 6.

i.              Housing Revenue Account

The position with regard to the Housing Revenue Account as set out in Section 13 and Appendix 7.

j.              Financial Risks: Reserves and Contingencies

Advise on strategic budget risks and opportunities as set out in Section 11 and Appendices 5.1, 5.2 and 5.3.

k.            Reserves and Balances

The position in relation to reserves as set out in the report and further detailed in Appendices 5.1 and 5.3.

l.              Mayor Priorities

An initiative to be included in the  ...  view the full decision text for item 10

Councillor Alibor Choudhury, Cabinet Member for Resources, introduced the report. He highlighted the challenges faced by the Council in responding to the government’s cuts programme. He reported that the Council had agreed a balanced budget and that no further savings were required to be identified for 2014/15. 

In respect of reserves he explained that the Council were maintaining significant reserves this year that the Administration planned to use to help smooth out future funding cuts but that they planned to ensure there was always a minimum £20 million of reserves in line with best practise.

Finally, he explained that despite the cuts the Council was continuing to work to meet the needs of the most vulnerable in society.

The Mayor opened the item up to discussion and heard from a number of Cabinet Members. Particular issues raised included:

·         The need for an accessible, and cheaper to run, new Town Hall.

·         Ways of taking advantage of the opportunities provided by the Crossrail project.

·         Welcoming new initiatives to support women looking to re-enter the jobs market, in particular in light of the disproportionate effect that the government’s cuts were having on women.

The Mayor endorsed the comments he heard. He thanked officers for their hard work, and the importance in protecting residents, as far as possible, from the government's cuts. He also highlighted positive investments made by the Council including Poplar Baths, new youth facilities, new homes, a new Ideas Store and work to deliver jobs and apprenticeships to residents.

Finally, he agreed the reasons for urgency as set out in the report and agreed the recommendations as set out.

RESOLVED

1.    To agree a General Fund Revenue Budget of £294.663m together with the Outline Strategic Plan identifying the key priority activities which will be delivered within this budget and which will be further developed into the Council’s Strategic Plan for 2014/2015.

2.    To accept the Council Tax Free Grant available from the Department of Communities and Local Government for 2014/2015 and thereby agree to continue to freeze Council Tax (Band D) at £885.52 for the new financial year.

3.    To agree to propose the items listed below for public consultation and consideration by the Overview & Scrutiny Committee in accordance with the Budget and Policy Framework (Section 16). A further report will then be submitted to the next Cabinet meeting in February detailing the results of consultations and inviting the Cabinet to recommend a Budget Requirement and Council Tax for 2014-15 to Full Council.

4.    To agree to conduct the Budget consultation in line with Section 16 in the body of the report.

5.    To consider and comment on the following matters -

a.            Budget Consultation

The approach to the budget consultation with the community and Overview and Scrutiny Committee.

b.            Funding

The funding available for 2014-2015 and the indications and forecasts for future years set out in Section 8.

c.            Base Budget 2014-2015

The Base Budget for 2014-2015 as £295.732m as detailed in Appendix 1.

d.            Growth and Inflation

The risks  ...  view the full minutes text for item 10