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Agenda item

Agenda item

Budget and Council Tax Report 2019/2020

Meeting of Council, Wednesday 27 February 2019 7.00 pm (Item 10.)

Decision:

RESOLVED, that Council considered the report and AGREED the following recommendations (as set out in the report):

1. To bring forward into 2019/20 the Council’s projected General Fund balances of £15.0m and to note the Housing Revenue Account (HRA) balances of £10.2m.

2. To agree for approval the directorate estimates and estimates for the General Finance Account items set out in Table 1, below.

3. To note that the budget is a financial exposition of the priorities set out within the Corporate Plan.

4. To note that in line with the requirements of the Local Government Act 2003, the Group Director, Finance and Corporate Resources, is of the view that:

The General Fund balances of £15.0m and the level of reserves, particularly in relation to capital, are adequate to meet the Council’s financial needs for 2019/20 and that considering the economic uncertainty they should not fall below this level. This view takes account of the reserves included in the Council’s latest audited Accounts as at 31 March 2018, the movements of those reserves since that date – which have been tracked through the Overall Financial Position (OFP) Reports, and the latest OFP projections. Note also, that the projections in the HRA to maintain the balance at £10.2m by 31 March 2018 are also considered to be adequate at this point in time but will need to continue to be reviewed in the light of the challenges facing the HRA.

The General Fund estimates are sufficiently robust to set a balanced budget for 2019/20. This takes into account the adequacy of the level of balances and reserves outlined above and the assurance gained from the comparisons of the 2018/19 budget with the projected spend identified in the December 2018 OFP. The overall level of the corporate contingency has been set at £2m.

5. To approve the proposed General Fund fees and charges as set out in Appendix 8 for implementation from 1st April 2019.

6. To continue the policy requiring the Group Director, Finance and Corporate Resources to seek to mitigate the impact of significant changes to either resources, such as Top Up Grant changes, or expenditure requirements.

7. To note the summary of the HRA Budget and Rent setting report agreed by Cabinet on 21^st January 2019.

8. To authorise the Group Director, Finance and Corporate Resources to implement any virements required to allocate provision for demand and growth pressures set out in this report subject to the appropriate evidence base being provided.

9. To approve:

The allocation of resources to the 2019/20 Non-Housing capital schemes referred to in Paragraph 24 and Appendix 7.

The allocation of resources to the 2019/20 Housing indicative capital programme referred to in Paragraph 24 and Appendix 7, including the HRA approvals previously agreed by Cabinet on January 21st 2019.

10. To note that the new capital expenditure proposals match uncommitted resources for the year 2019/20.

11. To agree the prudential indicators for Capital Expenditure and the Capital Financing Requirement, the Authorised Limit and Operational Boundary for External Debt, the Affordability prudential indicators and the Treasury Management Prudential Indicators for 2019/20 as set out in paragraph 25, and Appendix 7.

12. To confirm that the authorised limit for external debt of £687m agreed above for 2019/20 will be the statutory limit determined under section 3(1) of the Local Government Act 2003. Further reassurance about the robustness of the budget is the confirmation that the Council’s borrowings are within the boundaries of prudential guidelines.

13. To continue to support the approach of using reserves to manage emerging risks and liabilities and to note the latest reserve position.

14. To note that at its meeting on 21 January 2019 the Council agreed its Council Tax Base for the 2019/20 financial year as 72,552 in accordance with regulations made under section 33(5) of the Local Government Finance Act 1992. The Council Tax Base is the total number of properties in each of the eight council tax bands A to H converted to an equivalent number of band D properties.

15. (1)To agree that the following amounts be now calculated by the Council for the year 2019/20 in accordance with Sections 31A to 36 of the Localism Act 2011.

The authority calculates the aggregate of: (in accordance with Section 31A (2) of the Act)

(a) £1,149.154m being the expenditure which the authority estimates it will incur in the year in performing its functions and will charge to a revenue account, other than a BID Revenue Account, for the year in accordance with proper practices.

(b) £2m being such allowance as the authority estimates will be appropriate for contingencies in relation to amounts to be charged or credited to a revenue account for the year in accordance with proper practices.

(c) £nil being the financial reserves which the authority estimates it will be appropriate to raise in the year for meeting its estimated future expenditure.

(d) £nil being such financial reserves as are sufficient to meet so much of the amount estimated by the authority to be a revenue account deficit for any earlier financial year as has not already been provided for.

(e) £nil being the amount which it estimates will be transferred in the year from its general fund to its collection fund in accordance with section 97(4) of the 1988 Act, and

(f) £nil being the amount which it estimates will be transferred from its general fund to its collection fund pursuant to a direction under section 98(5) of the 1988 Act and charged to a revenue account for the year.

16. (2) The authority calculates the aggregate of: (in accordance with Section 31A (3) of the Act)

(a) £1,149.154m being the income which it estimates will accrue to it in the year and which it will credit to a revenue account, other than a BID Revenue Account, for the year in accordance with proper practices.

(b) £2.543m make it being the amount which it estimates will be transferred in the year from its collection fund to its general fund in accordance with section 97(3) of the 1988 Act.

(c) £nil being the amount which it estimates will be transferred from its collection fund to its general fund pursuant to a direction under section 98(4) of the 1988 Act and will be credited to a revenue account for the year, and

(d) £nil being the amount of the financial reserves which the authority estimates it will use in order to provide for the items mentioned in subsection (2) (a), (b), (e) and (f) above.

17. £82.299m being the amount by which the aggregate calculated under subsection (1) above exceeds that calculated under subsection (2) above, the authority calculates the amount equal to the difference; and the amount so calculated is its Council Tax Requirement for the year.

18. £1,134.35 being the amount at (3.2.17 in the report) divided by the amount at (3.2.14 in the report) above, calculated by the Council, in accordance with section 31A of the Act, as the basic amount of its council tax for the year.

19. 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 tables below as the amounts of Council tax for 2019/20 for each part of its area and for each of the categories of dwellings.

VALUATION BANDS
	A	B	C	D	E	F	G	H
	£	£	£	£	£	£	£	£
	756.23	882.27	1008.31	1134.35	1386.43	1638.51	1890.58	2268.70

20. That it be noted that for 2019/20 the Greater London Authority has stated the following amounts in precepts issued to the Council, in accordance with Section 40 of the Local Government Finance Act 1992, for each of the categories of dwellings shown below.

VALUATION BANDS
	A	B	C	D	E	F	G	H
	£	£	£	£	£	£	£	£
	213.67	249.29	284.90	320.51	391.73	462.96	534.18	641.02

21. That having calculated the aggregate in each case of the amounts at 3.2.19 and 3.2.20 in the report, the Council, in accordance with Section 30(2) of the Local Government Finance Act 1992, hereby sets the following amounts as the amounts of Council Tax for 2019/20 for each of the categories of dwellings as shown below.

VALUATION BANDS
	A	B	C	D	E	F	G	H
	£	£	£	£	£	£	£	£
	969.90	1131.56	1293.21	1454.86	1778.16	2101.47	2424.76	2909.72

Note: Subject to GLA confirmation of precept on 25th February 2018

22. To agree, subject to the decision of Members on recommendations 3.2.16 to 3.2.18 that Hackney’s Council Tax requirement for 2019/20 be £82.299m which results in a Band D Council Tax of £1,134.35 for Hackney purposes and a total Band D Council Tax of £1,454.86 including the Greater London Authority (GLA) precept. An analysis of the tax base total Band D Council Tax across Council Tax Bands is shown in 3.2.21 above and an exemplification of the taxbase and discounts by band, is shown in Appendix 5.

23. To agree that in accordance with principles approved under section 52ZB of the Local Government Finance Act 1992, and the new provisions included in the Localism Act 2011, the increase in the Council’s Council Tax requirement for 2019/20 as shown at Appendix 9 is not excessive (5% or above) and therefore does not require the Council to hold a referendum.

24. To agree the Treasury Management Strategy for 2019/20 to 2021/22, set out at Appendix 3.

25. To agree the criteria for lending and the financial limits set out at Appendix 3.

26. To approve the MRP statement setting out the method of calculation to be used, as set out in Appendix 3

Supporting documents: