Decision details

RESOLVED:

That the Cabinet:

1.    Note the budget monitoring position and treasury management update as at May 2023 (Month 2) as outlined in Part A of this report.

2.    Approve the financial recommendations set out below:

a.    Approve a contribution of £30k to the Mayor’s Charity from revenue generated from sales of resident deposits at textile banks within the authority.

b.    Approve acceptance of £11k grant funding from the Department for Work and Pensions (DWP) to cover systems related costs arising from the requirement to comply with legislative changes.

c.    Approve a contract extension with Oxygen Finance Ltd for the provision of the Hillingdon Council’s early payment programme for the period to December 2027.

Reasons for decision

Cabinet was informed of the forecast revenue, capital and treasury position for the current year 2023/24 to ensure the Council achieved its budgetary and service objectives.

The Cabinet Member for Finance outlined the national economic position which he noted had created a challenging environment for local authorities, in particular that inflation had been longer lasting than projected, and in part due to public sector pay increases. The Cabinet Member highlighted how such matters had impacted heavily on the cost of living for households and businesses alike.

The Cabinet Member explained the need to be prudent with such early forecasting of the year’s budget position, but commented that the Council’s financial performance remained robust and resilient. It was noted that the budget had adapted to absorb the additional expected costs of pay awards, and along with the projected of use earmarked reserves, the Council was projecting a position of £41.3m of total reserves by the end of the financial year. The importance of retaining and building the Council’s reserves was re-iterated and the programme of savings to assist with was on well on track and would expand going forward.

The Cabinet Member welcomed that the Council was able to borrow at competitive interest rates for its capital programme, where needed. It was noted that the position of the Dedicated Schools Budget was challenging, due to the increase in costs from out-of-borough special needs placements and an increase in Educational & Health Care Plans during the pandemic. It was welcomed that the measures agreed with the Department for Education to tackle the budget were generally on track and the Council’s investment in additional SEND places would further drive down costs materially.

Cabinet received an update on the Housing Revenue Account and made a number of other financial related decisions including a contribution to the Mayor’s Charity, a minor grant acceptance and award of contract for the provision of an early payment programme.

The Leader of the Council welcomed the Council’s plans to maintain sound financial management given the national economic position.

Alternative options considered and rejected

None.