Agenda item

Medium Term Financial Plan (MTFP) 2021/22 to 2025/26 December Update and Savings

A report from the Executive Director – Resources is attached. (Key decision – reference number 5224)




Councillor Mary Maguire (Cabinet Member for Finance and Procurement) introduced the report of the Executive Director – Resources.




1.            That the report included four key elements: a further review of the assumptions in the Medium Term Financial Plan (MTFP): an initial assessment of the Chancellor’s Spending review announcement on 25 November and its potential impact on the Council’s 2021/22 Budget; further savings to address the funding gap; and, to bring forward the Council’s Fees and Charges for 2021/22.


2.            That a balanced budget would be presented to the February Cabinet meeting, as set out in the report. This had been a financially challenging year which had followed ten years of Government austerity with significant cuts to the core funding of local government and extensive savings having already been made. The significant financial challenge being faced by the Council was emphasised.


3.            That the report set out the funding gap, with and without the impact of Covid-19. Including the impact of Covid-19, and after identification of £11.395m of savings, there remained a gap of £17.325m.


4.            That Appendix A of the report set out the second tranche of savings for 2021/22.


5.            That Officers would be fully assessing the impact of the Spending Review and the details of the Local Government Finance Settlement which would be reflected in the report to the February Cabinet meeting.


6.            That one of the key drivers for the Collection Fund deficit forecast was the increased take up of Council Tax Support, as set out in the report, including the number of working age residents in the Borough who were now unemployed or furloughed.


7.            The key points arising from the Spending Review 2021 as set out in the report. Core spending power increase of 4.5% in the funding settlement assumed a 2% increase in core council tax and 3% in adult social care precept. A full analysis of the detail of the Government funding settlement is now underway to assess the full impact. Officers were also working through the specific grants arising from Covid-19 as detailed in the report.


8.            That further work had been undertaken to close the budget gap and savings of £1.050m were set out in Appendix A of the report. There were a further £0.280m of further savings under development which would come forward in a future report.


9.            The review of Fees and Charges and the principles that had been applied to the review as set out in detail in the report and in Appendix B of the report. A robust review had been carried out and discussed with the Cabinet Members responsible. Benchmarking exercises had been undertaken as part of the review and there had been a focus on strengthening income streams. The detail contained within the report was discussed with Cabinet Members highlighting and explaining the impact on the fees and charges within their own areas of responsibility.


10.         That there had been little progress on other developments which had the potential to be financially beneficial for Enfield: the implementation of the Business Rates reset; Fair Funding; and, a long-term solution to the appropriate funding of Adult Social Care.


11.         Members continued disappointment at the lack of sufficient Government funding to meet the cost of Covid-19 despite the assurances that had previously been given. The difficulty in financial planning caused by a one-year Government spending review and the announcement being made at such a late stage in the budget planning process. Work would continue to assess the full implications for Enfield and a balanced budget would be presented to the next Cabinet meeting.


12.         That there had been no substantial increases in the charges for Adult Social Care, any increases had been inflationary and in line with corresponding benefit increases. Members were proud of the approach that Enfield had taken and expressed their thanks and gratitude to the social work staff for their continued valuable work. This was in the context of continued budget pressures, lack of Government funding and increased demand for Adult Social Care services.


13.         Members highlighted the reviews undertaken of fees and charges within their own portfolio areas including, registrars, libraries and environmental services. The fees remained competitive and income sources were being maximised as far as possible. Appropriate benchmarking had been carried out. The fees and charges proposed were appropriate and comparable with other local authorities.


14.         In considering the remaining financial challenges, the significant areas of deprivation in the Borough and the high level of need for council services from the Borough’s residents. The shortfall in the Council tax collection fund and the growing pressures on the Council Tax Support Scheme were reiterated. The significant and damaging impact of Covid-19 was highlighted over a range of areas including employment levels and the impact of missed education for many children. There had been no further Government funding to meet public health needs.


15.         Members acknowledged the Council’s sound financial management and that the Council would continue to lobby the Government for sufficient funding to continue to provide essential services to its residents.


Alternative Options Considered: The Council was modelling a range of options which were very much dependent on the overall impact of the Spending Review.


DECISION: The Cabinet agreed to


1.            Note the significant financial challenge faced by the Council:


·         Excluding the impact of Covid-19 and after the identification of £11.395m of savings a gap of £3.075m.

·         Including the impact of Covid-19 and after the identification of £11.395m of savings a gap of £17.325m.


2.            Note the potential impact of the single year Spending Review on the Council’s 2021/22 Budget.


3.            Agree the second tranche of savings for 2021/22 as detailed in Appendix A of the report.


4.            Instruct officers to bring back a balanced budget to the February Cabinet meeting having fully assessed the impact of the Spending Review and being in receipt of the details of the Local Government Finance Settlement.


5.            Recommend to Council to approve the 2021/22 Fees and Charges as detailed in Appendices B(i) to B(iv).


6.            Recommend to Council to delegate authority to Executive Directors in consultation with the relevant Cabinet Member to amend the fees and charges by service during the year.


Reason: The Council had a statutory duty to approve a balanced budget for 2021/22 in February along with consideration of the finances over the medium term and the Council’s reserves and balances. It was essential that there was a clear understanding of the anticipated income and expenditure flows for the Council, despite the uncertainties, and for proposals for savings to come forward early to ensure full delivery from 1 April 2021 or indeed to also contribute to addressing the financial pressures in 2021/22.

(Key decision – reference number 5224)

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