Agenda item

Report FSD22019

A key part of the Council’s financial strategy was to highlight the budget issues that need to be addressed by the Council over the coming financial years, by forecasting the level of available resources from all sources and budget pressures relating to revenue spending. Details of the capital programme were reported elsewhere on the agenda.

The Provisional Local Government Finance Settlement 2022/23, which covered 2022/23 only, provided the third year (following ten years of austerity) of real increases in funding and this included availability of the Adult Social Care (ASC) precept to support cost pressures in social care. It also provided funding towards the cost of the Adult Social Care Reforms over the next three years. There was no specific Covid funding provided.

Although the settlement was to be welcomed there remained uncertainty around the level of Government funding for 2023/24 and beyond, particularly as the Government would need to address the significant increase in public debt due to the pandemic. The longer-term Spending Review together with the awaited Fair Funding Review and Devolution of Business Rates (or any revised funding proposals) had been deferred until at least 2023/24.

The report identified the final issues affecting the 2022/23 revenue budget and sought recommendations to the Council on the level of the Bromley element of the 2022/23 Council Tax and Adult Social Care precept. Confirmation of the final GLA precept would be reported to the Council meeting on 28th February 2022. The report also sought final approval of the ‘schools budget’. The approach reflected in the report was for the Council to not only achieve a legal and financially balanced budget in 2022/23 but to have measures in place to deal with the medium-term financial position (2023/24 to 2025/26).

With the Government reductions in funding since austerity measures began,

although there had been some recent improvements in funding, the burden of financing increasing service demands fell primarily on the level of council tax and share of business rate income. The financial forecast assumed that the level of core grant funding would remain unchanged in future years.

The report had been scrutinised by the Executive, Resources and Contracts PDS Committee at its meeting on 7^th February 2022 and the Committee had supported the proposals.

RESOLVED that

2.1  Council is recommended to -

(a)  Approve the schools budget of £92.411m which matches the estimated level of Dedicated Schools Grant (DSG) after academy recoupment;

(b)  Approve the draft revenue budgets (as in Appendix 2 to the report) for 2022/23;

(c)  Agree that Chief Officers identify alternative savings/mitigation within their departmental budgets where it is not possible to realise any savings/mitigation reported to the previous meeting of the Executive held on 12^th January 2022;

(d)  Approve a revised Central Contingency sum of £18,231k (see Section 6, Recommendation 7 and Recommendation 2.1e of the report);

(e)  Approve the following provisions for levies for inclusion in the budget for 2022/23:

The reduction of £65k in the 2022/23 levy amounts is offset by a £65k increase in the 2022/23 Central Contingency as a provision towards meeting inflation cost pressures.

(f)  Note the latest position on the GLA precept, as above, which will be finalised in the overall Council Tax figure to be reported to full Council (see section 12);

(g)  Set a 1% increase in Adult Social Care Precept with a nil increase in Bromley’s General Council Tax, compared with 2021/22 (1.99% general increase plus 3% Adult Social Care Precept) and note that, based upon their consultation exercise, the GLA are currently assuming a 8.8% increase in the GLA precept;

(h)  Approve the revised draft 2022/23 revenue budgets to reflect the changes detailed above;

(i)  Approve the approach to reserves outlined by the Director of Finance (see Appendix 4 to the report);

(j)  Executive agrees that the Director of Finance be authorised to report any further changes directly to Council on 28^th February 2022.

2.2  Council Tax 2022/23 – Statutory Calculations and Resolutions (as amended by the Localism Act 2011).

Subject to (1) (a) to (j) above, if the formal Council Tax Resolution as detailed below is approved, the total Band D Council Tax will be as follows:

* The GLA Precept may need to be amended once the actual GLA budget is set.

(#)  in line with the 2022/23 Council Tax Referendum Principles, the % increase applied is based on an authority’s “relevant basic amount of Council Tax” (£1,341.13 for Bromley) – see paragraph 6 below.  Any further changes arising from these Principles will be reported directly to Council on 28^th February 2022.

2.3  Council be recommended to formally resolve as follows:

(i) It be noted that the Council Tax Base for 2022/23 is 133,347 ‘Band D’ equivalent properties.

(ii) Calculate that the Council Tax requirement for the Council’s own purposes for 2022/2023 is £178,835k.

(iii) That the following amounts be calculated for the year 2022/23 in accordance with Sections 31 to 36 of the Local Government Finance Act 1992, as amended (the Act):

(a)  £573,590k being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2) of the Act.

(b)  £394,755k being the aggregate of the amounts which the Council estimates or the items set out in Section 31A(3) of the Act.

(c)  £178,835k 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.

(d)  £1,341.13 being the amount at 3(c) above, divided by (1) above, calculated by the Council in accordance with Section 31B of the Act, as the basic amount of its Council Tax for the year. 

2.4 To note that the Greater London Authority (GLA) has issued a precept to the Council in accordance with Section 40 of the Local Government Finance Act 1992 for each category of dwellings in the Council’s area as indicated in the table below (NB. the GLA precept figure may need to be amended once the actual GLA budget is set).

2.5 That the Council, in accordance with Sections 30 and 36 of the Local Government Finance Act 1992, hereby sets the aggregate amounts shown in the table below as the amounts of Council Tax for 2022/23 for each part of its area and for each of the categories of dwellings.

2.6 That the Council hereby determines that its relevant basic amount of council tax for the financial year 2022/23, which reflects a 1% increase (Adult Social Care Precept increase of 1%), is not excessive.  The Referendums Relating to Council Tax Increases (Principles) (England) Report 2022/23 sets out the principles which the Secretary of State has determined will apply to local authorities in England from 2022/23.  Any further changes arising from these Principles will be reported directly to Council on 28^th February 2022. The Council is required to determine whether its relevant basic amount of Council Tax is excessive in accordance with the principles approved under Section 52ZB of the Local Government Finance Act 1992.

2.7 The Government have provided additional core funding as part of its Local Government Finance Settlement 22/23 of £771k which reflects additional inflation compensation to Councils for core funding through business rates income. Given the continuing inflation pressures, highlighted in the report, it is proposed that these monies be set aside within the 2022/23 Central Contingency as a provision towards meeting further inflation cost pressures across services. This will increase the Draft 2022/23 Central Contingency Sum by £771k.