Agenda item

Andy Goodwin, Head of Strategic Finance and Ceri Lamoureux, Head of Finance for Place presented the budget report which provided the Select Committee with an update on the current challenges and the work underway to prepare for the consultation budget to be presented to December Cabinet. A further update would be provided in January 2024. The feedback from the Committee would then be included in the budget report to be presented to Cabinet in February 2024.

Members were informed that, for 2023-24, the Council was reporting a net underspend of £23k. The services within the remit of the Residents’ Services Select Committee were forecast to overspend by £1,778k with this being driven by three key issues:

1.    the Green Spaces savings being impacted by external factors such as inflation;

2.    Community safety and Enforcement due to the impacts of Heathrow and Brexit-related pressures; and

3.    income pressures within the planning service.

Within these services there were £12.5m pounds worth of savings to be delivered in 23-24 with £1,83k of this recorded as red. £600k related to fees and charges predominantly linked to parking, £200k was linked to better targeting the demand for recycling sacks, £241k within Green Spaces and £42k for street cleansing. The HRA was currently forecast to break even.

With regards to the MTFF, in February 2023, the Council savings requirement was estimated to be £55,414k with the single largest factor being driven by exceptional inflation adding £60m to the budget gap within the remit of the Residents’ Services Select Committee. There were no exceptional inflation items with a total requirement within the remit of the Select Committee accounting for £7.1m of the £60m requirements, with the forecast pay award making up £4.7m of this and the remaining £2.4m being driven by the inflation requirement on contracted expenditure.

Service pressures were forecast to add £23m predominantly from the impact of demographic growth within waste services (£2.9m) and homelessness (£2.1m).  Corporate items added just under £12m with £6.5m of this being driven by the Council's borrowing requirement to fund the capital program and £4.1m from the TFL concessionary Affairs Levy. It was confirmed that, over the next few months in the build up to December Cabinet, officers would continue to work on assessing the budget gap with inflation remaining high and the pressures on Council Services linked to the cost-of-living crisis. They would also explore ways to reduce the Council's expenditure by driving efficiency gains whilst protecting frontline services and using the Council's transformation process to formulate the budget proposals that would be presented back to the Committee in January.

Members enquired why Green Spaces was isolated in respect of inflationary pressures. It was confirmed that inflation was not particularly impacting that service area, but had had a more significant impact because of the reducing envelope.

In respect of external consultants, Members enquired whether these were used to supplement existing staff. It was confirmed that, within the planning service there were niche specialist areas for which external consultants were used from time to time. The Committee was informed that there had been a slowdown in the construction area which had had a knock-on effect on planning income.

RESOLVED: That the budget planning report for services within the remit of the Residents’ Services Select Committee be noted.