Agenda item
BUDGET AND COUNCIL TAX 2013/14
To consider the revised proposals of the Mayor and Executive in relation to the Council’s Budget and Council Tax 2013/14.
The first Budget Council Meeting on 27 February 2013 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 27 February. The Mayor’s revised budget proposals will be circulated to Councillors as soon as they are available.
Officer advice on the proposals in the budget has been received by Members in the Budget Council Document Pack and papers tabled at Council on 27 February. In the interests of economy these papers are not reproduced in the attached report except where they affect the recommendations agreed. Members are requested to bring the Budget Council Pack and tabled papers with them to the meeting.
Decision:
A representative of the Unison trade union sought permission to address the meeting on the proposed budget amendments which he stated had implication for staff redundancies. The Service Head, Democratic Services advised that the deadline for petitions had passed and the Procedure Rules made no other specific provision for public or trade unions to address the meeting. There was a general provision under which the Chair of a meeting had discretion to allow participation by non-members but the Speaker indicated that he was not minded to exercise this discretion as there was no precedent for this at the Council meeting and he also understood that other persons had asked before the meeting to speak and had been told that they could not.
Mayor Lutfur Rahman introduced, and Councillor Alibor Choudhury moved, the revised budget proposals of the Mayor and Executive. Councillor Ohid Ahmed seconded the proposals. The Mayor stated that he and the Executive were unable to accept a number of the amendments proposed by Council on 27 February 2013, as set out with reasons in his tabled report.
Councillor Carlo Gibbs then moved the Council’s amended budget proposals as agreed at the meeting on 27 February 2013. Councillor Joshua Peck seconded the proposals.
Following a debate the amended budget proposal moved by Councillor Carlo Gibbs was put to the vote. The amended budget achieved the two thirds majority required by the regulations, with 34 Members voting in favour and 17 Members voting against, and accordingly was agreed.
DECISION
General Fund Revenue Budget and Council Tax Requirement 2013/14; and Treasury Management Strategy Statement, Annual Investment Strategy and Minimum Revenue Provision Policy Statement 2013-14.
This Council notes:
- That between the Chancellor’s Emergency Budget in 2010 and 2017/18, the Council’s General Fund budget will have been cut by 50%;
- The Council’s Medium Term Financial Plan is showing a black hole of £39m in 2015/16, £24m of which is unfunded, and a deficit of at least£55m is anticipated in 2016/17;
- By 2015/16, Council reserves will be brought down to their lowest advisable level of £20m;
· Many of the Mayor’s biggest spending commitments– including Free School Meals, THEOs, additional cleaning, Faith Buildings Fund, Educational Award and Council Tax Benefit – are only funded up to the election;
- Continuing these services after their current funding ceases would increase the council’s black hole by over £6m each year;
- In order to fund additional spending, the Mayor has initiated further frontline cuts, including a 5% reduction of the staffing budgets in Adults Health and Wellbeing and Children Schools and Families directorates, placing further pressure on frontline staff;
- Closing this black hole would require the equivalent of a £600 per household Council Tax increase or cutting in half the services provided to the elderly and disabled in the Borough;
- The Labour Group has been asking the Mayor for over a year to explain how he plans to close this financial black hole over which he has presided.
This Council believes:
· It is the duty of the Council to manage its finances efficiently, delivering a balanced budget to ensure long term stability of services for residents;
· In facing these cuts the residents of this borough deserve openness and honesty about how those elected to represent them will deal with this issue;
· The Mayor has lost control of the Council’s finances and has no proposals - such as an invest to save strategy, star chamber programme or review of service - to deal with this black hole;
· Plans to tackle the deficit will take time to bring online and, in order to be delivered in 2015, will have to be agreed by Council a long time before then;
· The Mayor is failing to show leadership in the face of the Government’s cuts by ignoring the Council’s precarious financial state until after the next election.
This Council further believes:
· It is wrong for the Mayor to continue spending significant amounts of public money on self-publicity such as East End Life, political mailings to residents, banners with his face on and other communication spending;
· It is wrong for the Mayor to increased spending on his office by 65% to £700,000, including £296k for advisors, when cuts to frontline staffing budgets elsewhere in the organisation are taking place. Particularly as he has a Cabinet that is supposed to advise him on these issues;
· It is wrong that the Mayor continues to hire a Mercedes and driver at significant cost to the Council;
This Council therefore RESOLVES:
1. To adopt the budget motion as set out in the agenda for the Budget Council Meeting on 27th February 2013 subject to the amendments accepted by the Mayor at the meeting (as attached at Appendix 1 to this Decision Sheet) and further amended as follows:-
· To delete funding of £1.214m from the budget used to fund East End Life, delivering a saving of £433k by:
- Reducing funding available for public notices from £267,000 to £100,000, sufficient to support the provision of statutory advertising in local newspapers, tendering a long term contract in order to secure the best rates;
- Reducing the funding of £176,000 for the advertising of choice based lettings to £50,000, sufficient to fund a provision that can be made available on a weekly basis in each housing office, leisure centre and one-stop shop in the borough, as well as online, to be managed by the lettings team;
- To cut departmental budgets by £143,000, to reduce their general advertising spend allocated in previous years to East End Life;
· To delete the funding of £296k for Mayor’s Advisors;
· Not allocate the £1.8m of unallocated funds set out in Section 3 of Cabinet Report Wednesday 13th February to any other provision;
· Use the £200,000 of available capital spending to free up £200,000 of previously capitalised revenue funding that will be ring fenced as a contingency fund to support the deletion of the budget used for East End Life.
· To ring fence the savings and unallocated funds resulting from the above and set out in the below table, into a ring-fenced reserve to support a reduction in the council’s black hole in 2015/16;
· To place a general restriction on the council that all virements outside of the agreed budget framework above £200,000 must be agreed by full council (* see note below)
Saving |
2013/14 |
2014/15 |
Total saving |
Unallocated Funding |
£1.8m
|
|
£1.8m |
Saving from statutory advertising |
£167k |
£167k |
£334k |
Saving from Choice Based Lettings advertising |
£126k |
£126k |
£252k |
Reduce departmental budgets (advertising spend) |
£143k |
£143k |
£286k |
Reallocation of Capital Funding |
0 |
0 |
0 |
Mayor’s Advisors |
£296k |
£296k |
£592k |
Total |
£2.532m |
£732k |
£3.264m |
· To delete the figure of ‘£150k’ in the amendment moved by Councillor Rania Khan for ‘’events’ and replace this with ‘£39k’.
(* Note: Proposal to impose a limit of £200,000 above which virements must be agreed by Full Council – Officers advise that this matter cannot be considered at Budget Council as procedures and regulations make it clear that Budget Council is for financial matters not constitutional matters. The Constitution requires that constitutional changes are referred to General Purposes Committee with full officer comments in order that all parties can be consulted. It would then be referred back to Full Council at a later date)
2. That accordingly a General Fund revenue budget of £297.806m and a total Council Tax Requirement for Tower Hamlets in 2013/14 of £63,343,000 be agreed as set out in the table below.
2. To agree a Council Tax for Tower Hamlets in 2013/14 of £885.52 at Band D resulting in a Council Tax for all other band taxpayers, before any discounts, and excluding the GLA precept, as set out in the table below:-
BAND |
PROPERTY VALUE |
RATIO TO BAND D |
LBTH COUNCIL TAX FOR EACH BAND |
|
|
FROM £ |
TO £ |
|
|
A |
0 |
40,000 |
6/9 |
£590.35 |
B |
40,001 |
52,000 |
7/9 |
£688.74 |
C |
52,001 |
68,000 |
8/9 |
£787.13 |
D |
68,001 |
88,000 |
9/9 |
£885.52 |
E |
88,001 |
120,000 |
11/9 |
£1,082.30 |
F |
120,001 |
160,000 |
13/9 |
£1,279.08 |
G |
160,001 |
320,000 |
15/9 |
£1,475.87 |
H |
320,001 |
and over |
18/9 |
£1,771.04 |
3. To agree that for the London Borough of Tower Hamlets in 2013/14:-
(a) The Council Tax for Band D taxpayers, before any discounts, and including the GLA precept, shall be £1,188.52 as shown below: -.
|
£ (Band D, No Discounts) |
LBTH |
885.52 |
GLA |
303.00 |
Total |
1,188.52 |
(b) The Council Tax for taxpayers in all other bands, before any discounts, and including the GLA precept, shall be as detailed in the table below: -
BAND |
PROPERTY VALUE |
RATIO TO BAND D |
LBTH |
GLA |
TOTAL |
||
FROM £ |
TO £ |
£ |
£ |
£ |
|||
A |
0 |
40,000 |
6/9 |
590.35 |
202.00 |
792.35 |
|
B |
40,001 |
52,000 |
7/9 |
688.74 |
235.67 |
924.41 |
|
C |
52,001 |
68,000 |
8/9 |
787.13 |
269.33 |
1,056.46 |
|
D |
68,001 |
88,000 |
9/9 |
885.52 |
303.00 |
1,188.52 |
|
E |
88,001 |
120,000 |
11/9 |
1,082.30 |
370.33 |
1,452.63 |
|
F |
120,001 |
160,000 |
13/9 |
1,279.08 |
437.67 |
1,716.75 |
|
G |
160,001 |
320,000 |
15/9 |
1,475.87 |
505.00 |
1,980.87 |
|
H |
320,001 |
and over |
18/9 |
1,771.04 |
606.00 |
2,377.04 |
4. To approve the statutory calculations of this Authority’s Council Tax Requirement in2013/14, detailed in Appendix 2 to this Decision Sheet, undertaken by the Chief Financial Officer in accordance with the requirements of Sections 31 to 36 of the Local Government Finance Act 1992.
5. To approve the Treasury Management Strategy Statement, the Annual Investment Strategy and the Minimum Revenue Provision Policy Statement as presented in the report of the Interim Corporate Director, Resources to Cabinet on 13 February 2013.
6. To approve the General Fund Capital and Revenue Budgets and Medium Term Financial Plan 2013-2016 as amended and summarised in the tables below.
APPENDIX 1
BUDGET COUNCIL MEETING – 27th FEBRUARY 2013
Independent Amendment
Proposer: Cllr Oliur Rahman
Seconder: Cllr Shafiqual Haque
This Council Notes:
1. The report from the University and College Union that Bethnal Green and Bow constituency has the highest number of people without formal qualifications in the country.
2. The report from the Campaign to End Child Poverty that Tower Hamlets continues to have among the highest levels of child poverty in the county.
3. The progress made over the last decade in the borough to increase the numbers of people with formal qualifications and reduce levels of child poverty. The recent census information shows a decrease in the proportion of people without any formal qualifications from 35% in 2001 to 20% in 2011. The current figure of 42% of children living in poverty is a decline from 53% in 2009 and 60% 2006.
This Council Agrees:
1. Government cuts threaten to roll back these advances:
- Instead of improving access to education for
poorer communities, the government is restricting it. They have
slashed the education maintenance allowance, increased tuition
fees, and replaced financial support for adult learners with
prohibitive loans.
- Instead of lifting people out of poverty, government welfare reform threatens to place more families to poverty. The DWP have identified thousands of households in Tower Hamlets that will be affected by welfare reform, not just large families or the workless, these are families living on low incomes. The average reduction will be £101 a week. 37% will lose more than £100 a week. 30% will lose between £50-10 a week.
This Council Notes the following resource implications:
1. The Council currently has a healthy level of reserves, expected to be £32,897,000 in March this year.
This Council Believes:
1. That the requirement to maintain a healthy level of reserves to meet current and future risks must be balanced responsibly with the needs of Tower Hamlets residents and the opportunity to invest in the borough’s future.
This Council Resolves:
1. To allocate the one-off funding in the following areas allocated from funding already set aside in the budget for third sector grants :
This Council Resolves:
1.
To extend provision in the
borough for those without formal qualifications and effected by
welfare cuts by committing £65,000 to the establishment the
new Unite Community Centre in St George’s Town
Hall.
2.
This is a partnership
between the council, Unite -
Europe’s largest trade union and Barclay’s
Bank.
3. The Unite Community Centre will offer:
- Education courses, employment and welfare advice services and community events.
- It will run three Skills for Life courses a week, and each will hold three sessions a week.
- Over the course of the year it aims to have 300 learners take Skills for Life courses.
- Based on this, and the provision of non-accredited ESOL, art and photography courses, and cultural events, the centre expects 50 unique visitors a week.
Budget Council Meeting – 27th February 2013
Independent Amendment
Proposer: Cllr Rania Khan
Seconder: Cllr Abdul Asad
This Council notes the progressive budget proposals from Mayor Rahman and his administration, which will see:
- A borough we can be proud of and which is environmentally friendly; including ten new THEOs, a potholes squad, new cycling infrastructure, a new Burial Ground, £1m further investment into our Faith Buildings and £800,000 on a borough wide deep clean.
- Investment in our young people; continuing our MEA scheme, providing 400 Mayor’s University Grants and free school meals for all children in reception and year one for the next two years.
- Bringing investment into key areas of the borough; bringing improvements into and promoting Roman Road, Burdett Road, Brick Lane and Bethnal Green Market.
- Keeping more money into residents’ pockets; freezing council tax and fees and charges and maintaining council tax benefit and creating a £1m Preventing Homelessness Fund.
This Council notes the following in relation to the borough’s rich heritage and culture:
- Tower Hamlets has an exceptionally rich history which has been shaped by the different people who have lived and worked here; the movements that started here and have grown to be national and global forces for changes; our links to royalty; and our role as the economic powerhouse of London and the country.
- Tower Hamlets is currently facing the fastest pace of change and development in the country. This development is creating jobs, new houses and a borough fit for the future.
- In light of this new development, there is a commitment from both residents and the administration of the borough to ensure that the history and heritage of the borough is preserved and celebrated.
- That Cultural Industries are one of the fastest growth areas in the borough, with currently over 30,000 jobs in cultural and creative industries in Tower Hamlets.
- The Enterprise Strategy identified the importance of cultural industries for the borough’s economic future.
This Council notes the following central government cuts to culture and heritage:
- The Suspension of English Heritage’s Blue Plaque scheme in January 2013, due cuts in government funding. The scheme is being wound down, with only approved plaques being installed and no new suggestions from the public being taken.
- The sustained funding reductions from central government sources towards arts and cultural activities, including the 30% reduction in funding to the Arts Council; the scrapping of the UK Film Council and Museums, Libraries and Archives Council; and the collective impact of reduced funding availability on the ability for cultural services to continue to run.
This Council notes the following in regards to the borough’s disabled and elderly residents and the third sector:
- Tower Hamlets has a larger number of residents receiving disability benefits and with limiting long term conditions than the national average.
- Disabled residents are more likely to live in poverty and to suffer from social isolation.
- Tower Hamlets has a young population, however 6.1% of the population are aged 65, of which we have the highest proportion of older residents living alone and an above average level of pensioner poverty.
- The Council continues to provide a wide range of services to disabled and elderly residents and this administrations’ commitment to free home care, makes Tower Hamlets the only council in the country to offer free home care.
- Tower Hamlets has a thriving third sector, with between 2,000 and 3,000 organisations working in the borough. They provide a range of vital services, including delivery against our own Community Plan targets. The important role they play has been recognised by this administration who has increased investment in the Mainstream Grants to £8m.
This Council notes the following central government reforms:
- The reduction in government support to older residents and disabled residents, including the change from RPI to CPI in pension uplift; the change in disability support from Disability Living Allowance onto Employment Support Allowance or Jobseekers Allowance and the transition from Disability Living Allowance to Personal Independence Payments, which will result in fewer residents receiving levels of support and those in receipt of benefits receiving less. This is in conjunction with rising food and energy bills which impact the hardest on those on fixed low incomes.
- That the rhetoric of the Big Society which suggested an enhanced role for the third sector has been undermined by the funding cuts from central government have resulted in reduced ability for the third sector to provide services and have resulted in the third sector feeling marginalised and under-recognised.
This Council Notes the following resource implications:
- The Council currently has a healthy level of reserves, expected to be £32,897,000 in March this year.
This Council Believes:
- That the requirement to maintain a healthy level of reserves to meet current and future risks must be balanced responsibly with the needs of Tower Hamlets residents and the opportunity to invest in the borough’s future.
This Council Resolves:
- To allocate the one-off funding in the following areas allocated from funding available from additional savings identified during the budget process and set out in the budget papers :
In relation to celebrating our older and disabled residents and the excellent work of our third sector:
Ø Allocate £150k for 3 events to celebrate the achievements and contributions made by older residents in Tower Hamlets, disabled residents in Tower Hamlets and the third sector.
o A Disability Day to further promote disabled residents’ dignity and wellbeing, which will be a celebration of disabled residents as well as provide information about support services and welfare advice.
o An Older People’s Day to celebrate the contributions older residents have made and continue to make in the borough as well as an opportunity to provide information about support services, activity and leisure opportunities.
o A Third Sector Celebration to promote the excellent work and achievements of our third sector.
In relation to celebrating our heritage and history
Ø Allocate a one-off sum of £4,000 to create a Tower Hamlets People’s History Plaque Scheme.
o This will ensure we are able to commemorate our unique history and heritage.
In relation to helping our young people into the creative industries
Ø Allocate £125k to create 10 part time apprenticeships in local creative industries.
This will enable young people in Tower Hamlets to gain
valuable experience in the huge range of cultural industries in the
borough.
APPENDIX 2
LONDON BOROUGH OF TOWER HAMLETS
COUNCIL 7th MARCH 2013
BUDGET & COUNCIL TAX STATUTORY CALCULATIONS
SETTING THE AMOUNT OF COUNCIL TAX FOR THE COUNCIL'S AREA
1. That the revenue estimates for 2013/2014 be approved.
2. That it be noted that, at its meeting on 9th January 2013, Cabinet calculated 71,531 as its Council Tax base for the year 2013/2014[Item T in the formula in Section 31B of the Local Government Finance Act 1992, as amended (the “Act”)]
3. That the following amounts be now calculated by the Council for the year 2013/14 in accordance with Section 31 to 36 of the Local Government Finance Act 1992 as amended and the Local Authorities (Alteration of Requisite Calculations) (England) Regulations 2011:
(a) |
£1,191,184,000 |
Being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2) ofThe Act. [Gross Expenditure] |
(b) |
£1,127,841,000 |
Being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(3) of The Act. [Gross Income] |
(c) |
£63,343,000 |
Being the amount by which the aggregate at 3(a) above exceeds the aggregate at 3(b) above, calculated by the Council, in accordance with Section 31A(4) of The Act, as its council tax requirement for the year. (Item R in the formula in Section 31B of The Act). [Council Tax Requirement] |
(d) |
£885.52 |
Being the amount at 3(c) above (Item R), all divided by Item T (2 above), calculated by the Council, in accordance with Section 31B(1) of The Act, as the basic amount of its Council Tax for the year. [Council Tax] |
(e) |
VALUATION BAND |
LBTH £ |
|
|
A |
590.35 |
|
|
B |
688.74 |
|
|
C |
787.13 |
|
|
D |
885.52 |
|
|
E |
1,082.30 |
|
|
F |
1,279.08 |
|
|
G |
1,475.87 |
|
|
H |
1,771.04 |
|
Being the amount given by multiplying the amount at 3(d) above by the number which, in the proportion set out in Section 5(1) of The Act, is applicable to dwellings listed in a particular valuation band divided by the number which in that proportion is applicable to dwellings listed in valuation band D, calculated by the Council, in accordance with Section 36(1) of The Act, as the amount to be taken into account for the year in respect of categories of dwellings listed in different valuation bands. |
4. That it be noted that for the year 2013/14 the Greater London Authority has stated the following amounts in precepts issued to the Council, in accordance with Section 40 of the Local Government Finance Act 1992, for each of the categories of the dwellings shown below:-
|
VALUATION BAND |
GLA £ |
|
A |
202.00 |
|
B |
235.67 |
|
C |
269.33 |
|
D |
303.00 |
|
E |
370.33 |
|
F |
437.67 |
|
G |
505.00 |
|
H |
606.00 |
5. That, having calculated the aggregate in each case of the amounts at 3(d) and 4 above, the Council, in accordance with Section 30(2) of the Local Government Finance Act 1992, hereby sets the following amounts as the amountsof Council Tax for the year 2013/14 for each of the categories of dwellings shown below:-
|
VALUATION BAND |
TOTAL COUNCIL TAX £ |
|
A |
792.35 |
|
B |
924.41 |
|
C |
1056.46 |
|
D |
1188.52 |
|
E |
1452.63 |
|
F |
1716.75 |
|
G |
1980.87 |
|
H |
2377.04 |
6. Government regulation now requires a local authority to conduct a referendum where if compared with the previous year, they set council tax increases that are “excessive”. Under current legislation and in accordance with principles approved under Section 52ZB Local Government Finance Act 1992, the Council tax set by the London Borough of Tower Hamlets for 2013/14 is not deemed to be excessive.
Minutes:
The Mayor’s revised budget motion was tabled, including his comments on the budget amendment passed by the Council on 27th February 2013 and his own revised proposals for the Council’s consideration.
A representative of the Unison trade union sought permission to address the meeting on the proposed budget amendments which he stated had implication for staff redundancies. The Service Head, Democratic Services advised that the deadline for petitions had passed and the Procedure Rules made no other specific provision for public or trade unions to address the meeting. There was a general provision under which the Chair of a meeting had discretion to allow participation by non-members but the Speaker indicated that he was not minded to exercise this discretion as there was no precedent for this at the Council meeting and he also understood that other persons had asked before the meeting to speak and had been told that they could not.
Mayor Lutfur Rahman introduced, and Councillor Alibor Choudhury moved, the revised budget proposals of the Mayor and Executive. Councillor Ohid Ahmed seconded the proposals. The Mayor stated that he and the Executive were unable to accept a number of the amendments proposed by Council on 27 February 2013, as set out with reasons in his tabled report.
Councillor Carlo Gibbs then moved the Council’s amended budget proposals as agreed at the meeting on 27 February 2013. Councillor Joshua Peck seconded the proposals.
Following debate the amended budget proposal moved by Councillor Carlo Gibbs was put to the vote. The amended budget achieved the two thirds majority required by the regulations, with 34 Members voting in favour and 17 Members voting against, and was therefore agreed. Accordingly it was:-
RESOLVED
General Fund Revenue Budget and Council Tax Requirement 2013/14; and Treasury Management Strategy Statement, Annual Investment Strategy and Minimum Revenue Provision Policy Statement 2013-14.
This Council notes:
· That between the Chancellor’s Emergency Budget in 2010 and 2017/18, the Council’s General Fund budget will have been cut by 50%;
· The Council’s Medium Term Financial Plan is showing a black hole of £39m in 2015/16, £24m of which is unfunded, and a deficit of at least £55m is anticipated in 2016/17;
· By 2015/16, Council reserves will be brought down to their lowest advisable level of £20m;
· Many of the Mayor’s biggest spending commitments– including Free School Meals, THEOs, additional cleaning, Faith Buildings Fund, Educational Award and Council Tax Benefit – are only funded up to the election;
· Continuing these services after their current funding ceases would increase the council’s black hole by over £6m each year;
· In order to fund additional spending, the Mayor has initiated further frontline cuts, including a 5% reduction of the staffing budgets in Adults Health and Wellbeing and Children Schools and Families directorates, placing further pressure on frontline staff;
· Closing this black hole would require the equivalent of a £600 per household Council Tax increase or cutting in half the services provided to the elderly and disabled in the Borough;
· The Labour Group has been asking the Mayor for over a year to explain how he plans to close this financial black hole over which he has presided.
This Council believes:
· It is the duty of the Council to manage its finances efficiently, delivering a balanced budget to ensure long term stability of services for residents;
· In facing these cuts the residents of this borough deserve openness and honesty about how those elected to represent them will deal with this issue;
· The Mayor has lost control of the Council’s finances and has no proposals - such as an invest to save strategy, star chamber programme or review of service - to deal with this black hole;
· Plans to tackle the deficit will take time to bring online and, in order to be delivered in 2015, will have to be agreed by Council a long time before then;
· The Mayor is failing to show leadership in the face of the Government’s cuts by ignoring the Council’s precarious financial state until after the next election.
This Council further believes:
· It is wrong for the Mayor to continue spending significant amounts of public money on self-publicity such as East End Life, political mailings to residents, banners with his face on and other communication spending;
· It is wrong for the Mayor to increased spending on his office by 65% to £700,000, including £296k for advisors, when cuts to frontline staffing budgets elsewhere in the organisation are taking place. Particularly as he has a Cabinet that is supposed to advise him on these issues;
· It is wrong that the Mayor continues to hire a Mercedes and driver at significant cost to the Council;
This Council therefore RESOLVES:
1. To adopt the budget motion as set out in the agenda for the Budget Council Meeting on 27th February 2013 subject to the amendments accepted by the Mayor at the meeting (as attached at Appendix 1 to this Decision Sheet) and further amended as follows:-
· To delete funding of £1.214m from the budget used to fund East End Life, delivering a saving of £433k by:
o Reducing funding available for public notices from £267,000 to £100,000, sufficient to support the provision of statutory advertising in local newspapers, tendering a long term contract in order to secure the best rates;
o Reducing the funding of £176,000 for the advertising of choice based lettings to £50,000, sufficient to fund a provision that can be made available on a weekly basis in each housing office, leisure centre and one-stop shop in the borough, as well as online, to be managed by the lettings team;
o To cut departmental budgets by £143,000, to reduce their general advertising spend allocated in previous years to East End Life;
· To delete the funding of £296k for Mayor’s Advisors;
· Not allocate the £1.8m of unallocated funds set out in Section 3 of Cabinet Report Wednesday 13th February to any other provision;
· Use the £200,000 of available capital spending to free up £200,000 of previously capitalised revenue funding that will be ring fenced as a contingency fund to support the deletion of the budget used for East End Life.
· To ring fence the savings and unallocated funds resulting from the above and set out in the below table, into a ring-fenced reserve to support a reduction in the council’s black hole in 2015/16;
· To place a general restriction on the council that all virements outside of the agreed budget framework above £200,000 must be agreed by full council (* see note below)
Saving |
2013/14 |
2014/15 |
Total saving |
Unallocated Funding |
£1.8m
|
|
£1.8m |
Saving from statutory advertising |
£167k |
£167k |
£334k |
Saving from Choice Based Lettings advertising |
£126k |
£126k |
£252k |
Reduce departmental budgets (advertising spend) |
£143k |
£143k |
£286k |
Reallocation of Capital Funding |
0 |
0 |
0 |
Mayor’s Advisors |
£296k |
£296k |
£592k |
Total |
£2.532m |
£732k |
£3.264m |
· To delete the figure of ‘£150k’ in the amendment moved by Councillor Rania Khan for ‘’events’ and replace this with ‘£39k’.
[* Note: Proposal to impose a limit of £200,000 above which virements must be agreed by Full Council – Officers advise that this matter cannot be considered at Budget Council as procedures and regulations make it clear that Budget Council is for financial matters not constitutional matters. The Constitution requires that constitutional changes are referred to General Purposes Committee with full officer comments in order that all parties can be consulted. It would then be referred back to Full Council at a later date]
2. That accordingly a General Fund revenue budget of £297.806m and a total Council Tax Requirement for Tower Hamlets in 2013/14 of £63,343,000 be agreed as set out in the table below.
3. To agree a Council Tax for Tower Hamlets in 2013/14 of £885.52 at Band D resulting in a Council Tax for all other band taxpayers, before any discounts, and excluding the GLA precept, as set out in the table below:-
BAND |
PROPERTY VALUE |
RATIO TO BAND D |
LBTH COUNCIL TAX FOR EACH BAND |
|
|
FROM £ |
TO £ |
|
|
A |
0 |
40,000 |
6/9 |
£590.35 |
B |
40,001 |
52,000 |
7/9 |
£688.74 |
C |
52,001 |
68,000 |
8/9 |
£787.13 |
D |
68,001 |
88,000 |
9/9 |
£885.52 |
E |
88,001 |
120,000 |
11/9 |
£1,082.30 |
F |
120,001 |
160,000 |
13/9 |
£1,279.08 |
G |
160,001 |
320,000 |
15/9 |
£1,475.87 |
H |
320,001 |
and over |
18/9 |
£1,771.04 |
4. To agree that for the London Borough of Tower Hamlets in 2013/14:-
(a) The Council Tax for Band D taxpayers, before any discounts, and including the GLA precept, shall be £1,188.52 as shown below: -.
|
£ (Band D, No Discounts) |
LBTH |
885.52 |
GLA |
303.00 |
Total |
1,188.52 |
(b) The Council Tax for taxpayers in all other bands, before any discounts, and including the GLA precept, shall be as detailed in the table below: -
BAND |
PROPERTY VALUE |
RATIO TO BAND D |
LBTH |
GLA |
TOTAL |
||
FROM £ |
TO £ |
£ |
£ |
£ |
|||
A |
0 |
40,000 |
6/9 |
590.35 |
202.00 |
792.35 |
|
B |
40,001 |
52,000 |
7/9 |
688.74 |
235.67 |
924.41 |
|
C |
52,001 |
68,000 |
8/9 |
787.13 |
269.33 |
1,056.46 |
|
D |
68,001 |
88,000 |
9/9 |
885.52 |
303.00 |
1,188.52 |
|
E |
88,001 |
120,000 |
11/9 |
1,082.30 |
370.33 |
1,452.63 |
|
F |
120,001 |
160,000 |
13/9 |
1,279.08 |
437.67 |
1,716.75 |
|
G |
160,001 |
320,000 |
15/9 |
1,475.87 |
505.00 |
1,980.87 |
|
H |
320,001 |
and over |
18/9 |
1,771.04 |
606.00 |
2,377.04 |
5. To approve the statutory calculations of this Authority’s Council Tax Requirement in 2013/14, detailed in Appendix 2 to these minutes, undertaken by the Chief Financial Officer in accordance with the requirements of Sections 31 to 36 of the Local Government Finance Act 1992.
6. To approve the Treasury Management Strategy Statement, the Annual Investment Strategy and the Minimum Revenue Provision Policy Statement as presented in the report of the Interim Corporate Director, Resources to Cabinet on 13 February 2013.
7. To approve the General Fund Capital and Revenue Budgets and Medium Term Financial Plan 2013-2016 as amended and summarised in the tables below.
APPENDIX 1
BUDGET COUNCIL MEETING – 27th FEBRUARY 2013
Independent Amendment
Proposer: Cllr Oliur Rahman
Seconder: Cllr Shafiqual Haque
This Council Notes:
1. The report from the University and College Union that Bethnal Green and Bow constituency has the highest number of people without formal qualifications in the country.
2. The report from the Campaign to End Child Poverty that Tower Hamlets continues to have among the highest levels of child poverty in the county.
3. The progress made over the last decade in the borough to increase the numbers of people with formal qualifications and reduce levels of child poverty. The recent census information shows a decrease in the proportion of people without any formal qualifications from 35% in 2001 to 20% in 2011. The current figure of 42% of children living in poverty is a decline from 53% in 2009 and 60% 2006.
This Council Agrees:
1. Government cuts threaten to roll back these advances:
- Instead of improving access to education for
poorer communities, the government is restricting it. They have
slashed the education maintenance allowance, increased tuition
fees, and replaced financial support for adult learners with
prohibitive loans.
- Instead of lifting people out of poverty, government welfare reform threatens to place more families to poverty. The DWP have identified thousands of households in Tower Hamlets that will be affected by welfare reform, not just large families or the workless, these are families living on low incomes. The average reduction will be £101 a week. 37% will lose more than £100 a week. 30% will lose between £50-10 a week.
This Council Notes the following resource implications:
1. The Council currently has a healthy level of reserves, expected to be £32,897,000 in March this year.
This Council Believes:
1. That the requirement to maintain a healthy level of reserves to meet current and future risks must be balanced responsibly with the needs of Tower Hamlets residents and the opportunity to invest in the borough’s future.
This Council Resolves:
1. To allocate the one-off funding in the following areas allocated from funding already set aside in the budget for third sector grants :
This Council Resolves:
1.
To extend provision in the
borough for those without formal qualifications and effected by
welfare cuts by committing £65,000 to the establishment the
new Unite Community Centre in St George’s Town
Hall.
2.
This is a partnership
between the council, Unite - Europe’s largest trade
union and Barclay’s Bank.
3. The Unite Community Centre will offer:
- Education courses, employment and welfare advice services and community events.
· It will run three Skills for Life courses a week, and each will hold three sessions a week.
· Over the course of the year it aims to have 300 learners take Skills for Life courses.
· Based on this, and the provision of non-accredited ESOL, art and photography courses, and cultural events, the centre expects 50 unique visitors a week.
Budget Council Meeting – 27th February 2013
Independent Amendment
Proposer: Cllr Rania Khan
Seconder: Cllr Abdul Asad
This Council notes the progressive budget proposals from Mayor Rahman and his administration, which will see:
- A borough we can be proud of and which is environmentally friendly; including ten new THEOs, a potholes squad, new cycling infrastructure, a new Burial Ground, £1m further investment into our Faith Buildings and £800,000 on a borough wide deep clean.
- Investment in our young people; continuing our MEA scheme, providing 400 Mayor’s University Grants and free school meals for all children in reception and year one for the next two years.
- Bringing investment into key areas of the borough; bringing improvements into and promoting Roman Road, Burdett Road, Brick Lane and Bethnal Green Market.
- Keeping more money into residents’ pockets; freezing council tax and fees and charges and maintaining council tax benefit and creating a £1m Preventing Homelessness Fund.
This Council notes the following in relation to the borough’s rich heritage and culture:
1. Tower Hamlets has an exceptionally rich history which has been shaped by the different people who have lived and worked here; the movements that started here and have grown to be national and global forces for changes; our links to royalty; and our role as the economic powerhouse of London and the country.
2. Tower Hamlets is currently facing the fastest pace of change and development in the country. This development is creating jobs, new houses and a borough fit for the future.
3. In light of this new development, there is a commitment from both residents and the administration of the borough to ensure that the history and heritage of the borough is preserved and celebrated.
4. That Cultural Industries are one of the fastest growth areas in the borough, with currently over 30,000 jobs in cultural and creative industries in Tower Hamlets.
5. The Enterprise Strategy identified the importance of cultural industries for the borough’s economic future.
This Council notes the following central government cuts to culture and heritage:
1. The Suspension of English Heritage’s Blue Plaque scheme in January 2013, due cuts in government funding. The scheme is being wound down, with only approved plaques being installed and no new suggestions from the public being taken.
2. The sustained funding reductions from central government sources towards arts and cultural activities, including the 30% reduction in funding to the Arts Council; the scrapping of the UK Film Council and Museums, Libraries and Archives Council; and the collective impact of reduced funding availability on the ability for cultural services to continue to run.
This Council notes the following in regards to the borough’s disabled and elderly residents and the third sector:
1. Tower Hamlets has a larger number of residents receiving disability benefits and with limiting long term conditions than the national average.
2. Disabled residents are more likely to live in poverty and to suffer from social isolation.
3. Tower Hamlets has a young population, however 6.1% of the population are aged 65, of which we have the highest proportion of older residents living alone and an above average level of pensioner poverty.
4. The Council continues to provide a wide range of services to disabled and elderly residents and this administrations’ commitment to free home care, makes Tower Hamlets the only council in the country to offer free home care.
5. Tower Hamlets has a thriving third sector, with between 2,000 and 3,000 organisations working in the borough. They provide a range of vital services, including delivery against our own Community Plan targets. The important role they play has been recognised by this administration who has increased investment in the Mainstream Grants to £8m.
This Council notes the following central government reforms:
- The reduction in government support to older residents and disabled residents, including the change from RPI to CPI in pension uplift; the change in disability support from Disability Living Allowance onto Employment Support Allowance or Jobseekers Allowance and the transition from Disability Living Allowance to Personal Independence Payments, which will result in fewer residents receiving levels of support and those in receipt of benefits receiving less. This is in conjunction with rising food and energy bills which impact the hardest on those on fixed low incomes.
- That the rhetoric of the Big Society which suggested an enhanced role for the third sector has been undermined by the funding cuts from central government have resulted in reduced ability for the third sector to provide services and have resulted in the third sector feeling marginalised and under-recognised.
This Council Notes the following resource implications:
- The Council currently has a healthy level of reserves, expected to be £32,897,000 in March this year.
This Council Believes:
- That the requirement to maintain a healthy level of reserves to meet current and future risks must be balanced responsibly with the needs of Tower Hamlets residents and the opportunity to invest in the borough’s future.
This Council Resolves:
- To allocate the one-off funding in the following areas allocated from funding available from additional savings identified during the budget process and set out in the budget papers :
In relation to celebrating our older and disabled residents and the excellent work of our third sector:
Ø Allocate £150k for 3 events to celebrate the achievements and contributions made by older residents in Tower Hamlets, disabled residents in Tower Hamlets and the third sector.
o A Disability Day to further promote disabled residents’ dignity and wellbeing, which will be a celebration of disabled residents as well as provide information about support services and welfare advice.
o An Older People’s Day to celebrate the contributions older residents have made and continue to make in the borough as well as an opportunity to provide information about support services, activity and leisure opportunities.
o A Third Sector Celebration to promote the excellent work and achievements of our third sector.
In relation to celebrating our heritage and history
Ø Allocate a one-off sum of £4,000 to create a Tower Hamlets People’s History Plaque Scheme.
o This will ensure we are able to commemorate our unique history and heritage.
In relation to helping our young people into the creative industries
Ø Allocate £125k to create 10 part time apprenticeships in local creative industries.
This will enable young people in Tower Hamlets to gain
valuable experience in the huge range of cultural industries in the
borough.
APPENDIX 2
LONDON BOROUGH OF TOWER HAMLETS
COUNCIL 7th MARCH 2013
BUDGET & COUNCIL TAX STATUTORY CALCULATIONS
SETTING THE AMOUNT OF COUNCIL TAX FOR THE COUNCIL'S AREA
1. That the revenue estimates for 2013/2014 be approved.
2. That it be noted that, at its meeting on 9th January 2013, Cabinet calculated 71,531 as its Council Tax base for the year 2013/2014[Item T in the formula in Section 31B of the Local Government Finance Act 1992, as amended (the “Act”)]
3. That the following amounts be now calculated by the Council for the year 2013/14 in accordance with Section 31 to 36 of the Local Government Finance Act 1992 as amended and the Local Authorities (Alteration of Requisite Calculations) (England) Regulations 2011:
(a) |
£1,191,184,000 |
Being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2) ofThe Act. [Gross Expenditure] |
(b) |
£1,127,841,000 |
Being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(3) of The Act. [Gross Income] |
(c) |
£63,343,000 |
Being the amount by which the aggregate at 3(a) above exceeds the aggregate at 3(b) above, calculated by the Council, in accordance with Section 31A(4) of The Act, as its council tax requirement for the year. (Item R in the formula in Section 31B of The Act). [Council Tax Requirement] |
(d) |
£885.52 |
Being the amount at 3(c) above (Item R), all divided by Item T (2 above), calculated by the Council, in accordance with Section 31B(1) of The Act, as the basic amount of its Council Tax for the year. [Council Tax] |
(e) |
VALUATION BAND |
LBTH £ |
|
|
A |
590.35 |
|
|
B |
688.74 |
|
|
C |
787.13 |
|
|
D |
885.52 |
|
|
E |
1,082.30 |
|
|
F |
1,279.08 |
|
|
G |
1,475.87 |
|
|
H |
1,771.04 |
|
Being the amount given by multiplying the amount at 3(d) above by the number which, in the proportion set out in Section 5(1) of The Act, is applicable to dwellings listed in a particular valuation band divided by the number which in that proportion is applicable to dwellings listed in valuation band D, calculated by the Council, in accordance with Section 36(1) of The Act, as the amount to be taken into account for the year in respect of categories of dwellings listed in different valuation bands. |
4. That it be noted that for the year 2013/14 the Greater London Authority has stated the following amounts in precepts issued to the Council, in accordance with Section 40 of the Local Government Finance Act 1992, for each of the categories of the dwellings shown below:-
|
VALUATION BAND |
GLA £ |
|
A |
202.00 |
|
B |
235.67 |
|
C |
269.33 |
|
D |
303.00 |
|
E |
370.33 |
|
F |
437.67 |
|
G |
505.00 |
|
H |
606.00 |
5. That, having calculated the aggregate in each case of the amounts at 3(d) and 4 above, the Council, in accordance with Section 30(2) of the Local Government Finance Act 1992, hereby sets the following amounts as the amounts of Council Tax for the year 2013/14 for each of the categories of dwellings shown below:-
|
VALUATION BAND |
TOTAL COUNCIL TAX £ |
|
A |
792.35 |
|
B |
924.41 |
|
C |
1056.46 |
|
D |
1188.52 |
|
E |
1452.63 |
|
F |
1716.75 |
|
G |
1980.87 |
|
H |
2377.04 |
6. Government regulation now requires a local authority to conduct a referendum where if compared with the previous year, they set council tax increases that are “excessive”. Under current legislation and in accordance with principles approved under Section 52ZB Local Government Finance Act 1992, the Council tax set by the London Borough of Tower Hamlets for 2013/14 is not deemed to be excessive.
Supporting documents:
-
Report - Council's Revised Budget Amendment, item 4.
PDF 61 KB
-
Report Appx 1a - Substantive Budget Motion (Final), item 4.
PDF 107 KB
-
Report Appx 1b - MTFP Appendix 2013-14 to 2015-16, item 4.
PDF 16 KB
-
Report - Appx 2a Budget Amendment 2013 Cllr Oliur Rahman, item 4.
PDF 44 KB
-
Report - Appx 2b Budget Amendment 2013 Cllr Rania Khan, item 4.
PDF 71 KB
-
Report - Appx 3 Budget Amendment 2013 Labour, item 4.
PDF 69 KB
- Appendix 4 Substantive Motion - Details of Funding (II), item 4. HTM 11 KB