Agenda item

A report from the Executive Director – Resources is attached. (Key decision – reference number 5150)

Councillor Mary Maguire (Cabinet Member for Finance and Procurement) introduced the report of the Executive Director – Resources setting out how the Council would allocate its resources over the medium term to deliver the Council’s objectives during a period of both huge uncertainty and financial challenge.

NOTED

1.            That the Council had agreed a five-year Medium Term Financial Plan (MTFP) covering the period 2020/21 to 2024/25 at Council in February 2020. This report updated the assumptions from that time and set out the Strategy for agreeing the 2021/22 Budget and the MTFP for 2021/22 to 2025/26. The Council was now in a totally different position due to the impact of the coronavirus pandemic and the challenging times ahead were highlighted. The Council had a sound financial position and balanced budget in February. Paragraphs 18, 19 and 20 of the report provided an update on the MTFP assumptions. A best case assumption had been drawn which opened the year one gap to £18.613 and with the rolling forward of the Plan to 2025/26 there was a five year gap of £58.594m. The refresh of the financial assumptions was detailed in full in section 5 of the Plan. The funding gap arising from the cost of dealing with the pandemic and the Government funding received was highlighted. The in year response to financial pressures arising from Covid-19 was set out in section 6 of the Strategy.

2.            The difficulty in accurately forecasting the impact on Council Tax income due to the ongoing issue of a significant number of residents being furloughed and the potential rise in unemployment rates and, the impact on businesses in the Borough.

3.            In addition to the uncertainty of the ongoing economic impact of the pandemic, Members noted the continuing need for fairer funding from the Government and the demographic pressures being faced by the Council as set out in the report and Strategy. The Council would continue to lobby the Government on funding issues, as set out in decision 6 below.

4.            The approach being taken to the identification of savings detailed in the report and reflected in the decisions below. Further reports would be presented to Cabinet in due course.

5.            That Members and Officers were continuing to work hard to continue to support its most vulnerable residents.

6.            The significance of the economic situation and the resulting instability in the local economy which would require the Council to provide and increased level of support to the Borough’s vulnerable residents. The pressures on local government finances was highlighted together with the need for the Government to honour its funding commitments to Councils.

7.            The significant and continuing pressures on the provision of Adult Social Care, the demographic factors in the Borough and the statutory duties to meet. Members acknowledged the challenges in continuing to support its vulnerable residents. Additional costs had been incurred during the pandemic, for example, in the provision of personal protective equipment (PPE) and the testing facilities required.

8.            That the pressures were being faced across London Councils and they would lobby the Government for adequate funding to meet service pressures and demands, as detailed in the report.

9.            The Executive Director – Resources outlined Enfield’s funding position including the historical underfunding by Government through the damping mechanism. The Council had worked hard to maintain a robust and resilient budget. The Council would continue to lobby the Government and would continue to undertake benchmarking with other local authorities.

10.         The MTFS was a comprehensive and important document.

Alternative Options Considered: None appropriate to this report.

DECISION: The Cabinet agreed to

1.            Endorse the Medium-Term Financial Strategy.

2.            Actively lobby Government to bring forward Fair Funding and the Business Rates reset.

3.            Actively lobby Government to reform Adult Social Care funding.

4.            Promote engagement in the 2021 Census.

5.            Note the funding gap of £18.613m for 2021/22 and of £58.594m across the five year medium term.

6.            Note the current shortfall in funding from Government to meet the financial cost to the Council of responding to the Covid-19 crisis and continue to lobby Government to meet these costs in full.

7.            Delegate authority to the Leader of the Council in consultation with the relevant portfolio holder to approve in year savings ahead of the September meeting of Cabinet.

8.            Instruct the Acting Executive Director of Resources to bring a report to the September meeting of Cabinet providing an update on the 2020/21 financial year.

9.            Agree the approach to develop savings and income generation proposals across the medium term.

10.         Note the need for scenario planning and identification of savings options for best, moderate and worst case positions and the potential for significant service reductions should further government support fail to materialise.

Reason: To ensure the Council meets its statutory duty to set a balanced budget in February 2021.

(Key decision – reference number 5150)