Agenda item

Report FSD23012

 

A key part of the financial strategy was to highlight the budget issues that would 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 and the funding strategy were reported to the previous meeting of the Executive.

 

The Provisional Local Government Finance Settlement 2023/24, which covered 2023/24 only with limited indication of funding for 2025/26, provided the fourth year (following 10 years of austerity) of real increases in funding. The settlement included continuation of the ASC precept, repurposed social care funding, additional adult social care funding and other changes.

 

Although the settlement was to be welcomed there remained uncertainty around the level of Government funding for 2024/25 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) was not expected until 2026/27.

 

The report identified the final issues affecting the 2023/24 revenue budget and sought recommendations to the Council on the level of the Bromley element of the 2023/24 Council Tax and Adult Social Care precept. Confirmation of the final GLA precept would be reported to the Council meeting on 27^th February 2023. The report also sought final approval of the ‘schools budget’. The approach reflected in this report was for the Council to not only achieve a legal and financially balanced budget in 2023/24 but to have measures in place to deal with the medium-term financial position (2024/25 to 2026/27).

 

With the Government reductions in funding since austerity measures began, although there have been some recent improvements in funding, the burden of financing increasing service demands falls 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 real terms, from 2025/26.

 

The report had been scrutinised by the Executive, Resources and Contracts PDS Committee at its meeting on 2 February 2023 and the Committee had supported the recommendations.

 

RESOLVED: That

 

2.1 Council be recommended to:

 

a)  Note the Final Local Government Settlement 2023/24, announced by DLUHC on 6^th February, which included additional Services Grant funding of £61.5k and that these monies be set aside within the 2023/24 Central Contingency.

 

b)  Approve the schools budget of £98.674m which matches the estimated level of Dedicated Schools Grant (DSG) after academy recoupment;

 

c)  Approve the draft revenue budgets (as detailed in the revised Appendix 2) for 2023/24

 

d)  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 18^th January 2023;

 

e)  Approve a revised Central Contingency sum to reflect the allocation of the pay award, movement of levies and final local government settlement, resulting in a sum of £17,536k (see Section 6 and the revised Appendix 3);

 

f)  Approve the following provisions for levies for inclusion in the budget for 2023/24:

 

	£’000
London Pensions Fund Authority *	460
London Boroughs Grant Committee	246
Environment Agency (flood defense etc.)	266
Lee Valley Regional Park	353
Total	1,325

  * This amount is provisional and subject to revision.

 

The increase of £23k in the 2023/24 levy amounts is offset by a £23k decrease in the 2023/24 Central Contingency as a provision towards meeting inflation cost pressures.

 

g)  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);

 

h)  Sets a 2% increase in Adult Social Care Precept with a 2.99% increase in Bromley’s General Council Tax, compared with 2022/23 (1% Adult Social Care Precept) and notes that, based upon their consultation exercise, the GLA are currently assuming a 9.7% increase in the GLA precept;

 

i)  Approve the revised draft 2023/24 revenue budgets to reflect the changes detailed above;

 

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

 

k)  Note that the Executive agrees that the Director of Finance be authorised to report any further changes directly to Council on 27^th February 2023.

 

 

2.2  Council Tax 2023/24 – Statutory Calculations and Resolutions (as amended by the Localism Act 2011).

 

Subject to 2.1 (a) to (k) above, if the formal Council Tax Resolution as detailed below is approved, the total Band D Council Tax will be as follows:

 

	2022/23 £	2023/24 £	Increase £	Increase % (note #)
Bromley (general)	1,178.15	1,218.25	40.10	2.99
Bromley (ASC precept)	162.98	189.80	26.82	2.00
Bromley (total)	1,341.13	1,408.05	66.92	4.99
GLA *	395.59	434.14	38.55	9.7
Total	1,736.72	1,842.19	105.47	6.07

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

 

(#) in line with the 2023/24 Council Tax Referendum Principles, the % increase applied is based on an authority’s “relevant basic amount of Council Tax” (£1,408.05 for Bromley) – see paragraph 6 below.  Any further changes arising from these Principles will be reported directly to Council on 27^th February 2023.

 

2.3  Council be recommended to formally resolve as follows:

 

1.  It be noted that the Council Tax Base for 2023/24 is 134,093 ‘Band D’ equivalent properties.

 

2.  Calculate that the Council Tax requirement for the Council’s own purposes for 2023/2024 is £188,810k.

 

3.  That the following amounts be calculated for the year 2023/24 in accordance with Sections 31 to 36 of the Local Government Finance Act 1992, as amended (the Act):

 

(a)  £617,863k being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2) of the Act.

 

(b)  £429,053k being the aggregate of the amounts which the Council estimates or the items set out in Section 31A(3) of the Act.

 

(c)  £188,810k 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)  £1,408.05 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. 

 

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).

 

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 2023/24 for each part of its area and for each of the categories of dwellings.

 

Valuation Bands	London Borough of Bromley £	Greater London Authority £	Aggregate of Council Tax Requirements £
A	938.70	289.43	1,228.13
B	1,095.15	337.66	1,432.81
C	1,251.60	385.90	1,637.50
D	1,408.05	434.14	1,842.19
E	1,720.95	530.62	2,251.57
F	2,033.85	627.09	2,660.94
G	2,346.75	723.57	3,070.32
H	2,816.10	868.28	3,684.38

 

6.  That the Council hereby determines that its relevant basic amount of council tax for the financial year 2023/24, which reflects a 4.99% increase (Adult Social Care Precept increase of 2%), is not excessive.  The Referendums Relating to Council Tax Increases (Principles) (England) Report 2023/24 sets out the principles which the Secretary of State has determined will apply to local authorities in England from 2023/24. Any further changes arising from these Principles will be reported directly to Council on 27^th February 2023. 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.