Agenda and draft minutes

1.1  Apologies from Cllr Hercock.

2.1  There was no urgent item and the order of business was as per the agenda.

3.1  None.

4.1  Minutes of the previous meeting were approved.

5.1  The Chair welcomed to the meeting Councillor Geoff Taylor, Cabinet Member for Finance and Customer Services and Ian Williams, Group Director Finance and Corporate Resources from London Borough of Hackney.

5.2  Topic areas submitted in advance for Cabinet Question time were:

·  Council tax

·  Pensions

·  Business rates

·  Procurement.

5.3  The detailed questions under each heading are outlined on pages 19-20 in the agenda.

5.4  The Chair invited the Cabinet Member for Finance and Customer Services to open by providing a response to the questions submitted in advance.  The following substantive points were made:

5.5  Council Tax

5.5.1  The Council Tax Reduction Scheme (CTRS) has been operational for approximately 4 years.  The scheme is scheduled to be reviewed in 2017.

5.5.2  Before 2012 the council tax benefits system operated on the basis that the local authority would make the reduction and the Government would refund the full cost of the deductions made.

5.5.3  Following austerity local authorities were given 90% of the budget and tasked with setting up their own CTRS.  In addition councils were still required to give the same relief to pensioners.

5.5.4  Funding for the CTRS comes in the Council’s main budget the Revenue Support Grant (RSG), so it is not easy to identity the amount the government has given to fund the CTRS.

5.5.5  Since austerity began the budget has reduced significantly.  The budget is approximately half the amount from when the Council was initially tasked with setting up the CTRS.  The cost of the scheme is still based on the original budget. 

5.5.6  If the CTRS was viewed purely as a financial model it would be reduced.  However making any reduction to the scheme will be a challenge because of the client group.

5.5.7  The scheme needs to be reviewed and the cost reduced but the key challenge will be to not adversely affect the people in receipt of Council Tax (CT) benefits because they are vulnerable. 

5.5.8  The CTRS review will include engagement with stakeholders so the council can better understand the key areas of need for the people on CTRS. 

5.5.9  In relation to CT arrears the following points were made:

Paying CT is not optional it is a requirement.  There are some people who have to go without luxuries to ensure their bills are paid.  But it was acknowledged there are some people who still find it hard to pay the CT and need assistance. 

5.5.10  Hackney Council have developed processes that enable residents to make arrangements as early as possible.  There are a range of options in place to help make the payments manageable, like a longer period to pay than the standard timeline; paying by direct debit to help manage their finances and a revised debt recovery process.  The Council has added additional stages such as a letter, text messages etc to help provide assistance as soon as possible.  It was pointed out the support mechanisms in place will only be successful if a person engages and admits they need support.  ...  view the full minutes text for item 5.

6.1  The Chair welcomed to the meeting Councillor Geoff Taylor, Cabinet Member for Finance and Customer Services and Ian Williams, Group Director Finance and Corporate Resources from London Borough of Hackney.

6.2  The two areas discussed under this item were:

6.3  Britain’s exit from the European Union and the implications for local government

The Commission asked the Council to provide an update on the implication of Brexit to councils.  Looking at local: economy, labour market and Hackney Council’s plans.

6.4  Further information on Income generation and commercialisation

The Commission asked the Council to provide information about services that have the potential for income generation - beyond increasing fees and charges – and to provide an overview of the Council’s approach and work on income generation for services across the organisation and the potential for commercial activity.

6.4  Brexit report

6.4.1  A 2 year negotiation period will commence when Article 50 is triggered at the end of March 2017.

6.4.2  The first task for central and local government is to understand the extent to which European Union (EU) legislation affects its operations.  For example the majority of EU waste management law has been transposed directly into domestic law within the UK. This means that the relevant legislation and requirements on local authorities will not automatically or immediately be affected by the UK’s exit from the EU.

6.4.3  A 2013 LGA report suggests that around half of all regulations affecting local councils originate from the EU but other commentators have put the figure at 70%. Given that many of these regulations have been implemented by Primary and Secondary legislation in the UK, they will not lapse in the event of leaving the EU.  For example waste operations are largely governed by EU directives.

6.4.4  The former Secretary of State for DCLG was reported to have said “he argued successfully for English local government to be part of the negotiations on the terms of our exit…  When we are transferring powers from the EU toBritain Ithink itis essentialthat Whitehallis notthe defaultdestination forthem”.

6.4.5  The Council continues to work with colleagues in London Councils and the GLA with regards to London devolution following the budget announcement.

6.4.6  The UK economy is vulnerable due to its “twin deficits” – budget and current account.  The current account was a record 7% of GDP in 4Q 2015, and when added to the budget deficit, the twin deficits amount to 10% of GDP, which in emerging markets is usually seen as the point at which investors become deeply concerned.  There is a possibility that Brexit will catalyse those risks.  The latest announcement from the Chancellor indicates the UK economy is showing signs of modest strength.

6.4.7  There is still business activity whilst there preparation for Brexit get underway.  There are positive moves for the local economy like Amazon occupying the whole building it moved into and making the location its principle place of business.

6.4.8  The UK was due  ...  view the full minutes text for item 6.

7.1  Members discussed the work programme and agreed the points below.

7.2  Following the short review looking at income generation the Commission will write to the Scrutiny Panel and suggest they continue with this work.  The note will summarise what G&R has considered and the questions to ask the Council about in relation to it income generation strategy.  The points noted were:

·  Municipal enterprise needs to go beyond fees and charges and generate income in the £100,000s not the £10,000s (£500k is the equivalent to 1% increase in council tax).  That this a very important area for the council to continue to explore and this means looking at things that have material value.

·  The council should concentrate the income generation activities it is good at doing.

·  The Council need sot ensure it has the right culture and resources to support this work (e.g. to do Tiger Way and Nile Street the council had to build up an expert team in this)

·  This will involve taking on more risk

·  There needs to be scrutiny and accountability for this work when it is through joint boards. 

·  Making sure the lesson learnt from the early examples (Tiger Way and Nile Street) are incorporated in future projects.

7.3  Recommend the Scrutiny Panel continues to monitor temporary accommodation.

7.4  Invite Cllr Ann Munn, the current Chair of the Scrutiny Chairs Group and the Cllr Rebecca Rennison, Cabinet Advisor for Advice Service and Preventing Homelessness to formally note the work from G&R to be incorporated in the new overview and scrutiny structure.

7.5  Members wanted to highlight the importance of covering Temporary Accommodation, Income Generation and ensuring the Council embarks on a culture change programme.

7.6  In the discussion about the draft devolution report the following comments were noted:

7.7  Comments From Cllr Sharman

a)  Double check if there are any statements that don't relate to each other

b)  Too much emphasis on the economy and especially fiscal devolution - needs to emphasise more the impact on local people - able to define the place they live in more

c)  Don't say that economic growth leads to local jobs as this is not always the case - depends who has access to the economy

d)  Emphasise in the plan section that the council should define the objectives and outcomes it wants to see in each service area

e)  Need to include in the body of the text that the challenge with devolution is postcode lottery - have to face the argument and win it 

f)  The variable geography point comes out well as a principle but not so much in the body of the text. Needs to be clearer in the text that devolution is not going to be neat because there will be different groupings for different service areas for devolution

g)  The statement that London and the boroughs don't  ...  view the full minutes text for item 7.

8.1  None.