Agenda item

Budget & Council Tax 2025-26

This report sets out the Council’s budget proposals for 2025 - 26. It also sets out the results of the consultation, scrutiny and equalities processes. Subject to approval by Cabinet, these will form the basis of the budget to be considered at the Full Council meeting on 27 February 2025.

The report also sets out the overall financial position facing the Council for the medium term and highlights the significant risks, issues and uncertainties.

Decision:

Cabinet NOTED the following comments made in advance of considering the main report on the Budget & Council Tax 2025-26:

1. Councillor Conneely, as Chair of the Scrutiny Budget Scrutiny Task Group, summarising the main recommendations from the Task Group in relation to the budget process which had been included as Appendix D to the Budget and Council Tax 2025 - 26 report. In introducing the report, Councillor Conneely began by thanking all members of the Budget Scrutiny Task Group along with everyone else who had participated in the evidence sessions as part of the scrutiny process. In emphasising the ongoing nature of the financial challenges and pressures faced by the Council, Councillor Conneely reiterated the need for fundamental reform of the current way in which local authorities were funded, given the inadequacy of the existing funding regime.

In outlining the comprehensive nature of the process undertaken by the Task Group in reviewing the budget proposals, it was hoped Cabinet would actively seek to take forward the recommendations made as a result which, it was highlighted, had included a focus on:

· The impact of the proposed changes to the Council Tax Support Scheme and package of support being provided for more vulnerable residents in seeking to manage the impact, which it was noted the Resource & Public Realm Scrutiny Committee would continue to monitor.

· The need to review the way in which the use of funding generated through Strategic Community Infrastructure Levy could be maximised to provide optimal community benefit; and

· The way in which the Council’s commissioning and procurement arrangements could be enhanced to provide greater cost efficiency, value for money and social value.

In concluding, Councillor Conneely once again thanked all those involved for their participation in the Task Group and commended the recommendations made by the Budget Scrutiny Task Group to Cabinet for consideration as part of the budget setting process.

2. Councillor Lorber who, whilst recognising the financial crisis faced by local government, felt it important to highlight the £150m reserve of Strategic Community Infrastructure Levy (SCIL) funding held in Brent. Whilst aware of the restrictions in the permitted use of this funding, Councillor Lorber felt stronger representations needed to be made to the Government in seeking to ease the restrictions and provide greater flexibility and autonomy in how the Council could use this funding given the wider pressures and demands faced by key local services and in addressing what he felt to be the current poor state of the borough. In closing, he felt the £150m SCIL reserve identified could make a significant contribution towards addressing the issues residents were concerned about and therefore was keen to encourage ongoing lobbying of Government to allow Councils to decide how to spend that money and avoid the need for further cuts to services.

Having noted the comments made by Councillor Lorber and welcoming and supporting the approach taken and recommendations made by the Budget Scrutiny Task Group, Cabinet RESOLVED:

(1) To recommend to Full Council an overall 4.99% increase in the Council’s element of Council Tax for 2025/26, with 2% as a precept for Adult Social Care and a 2.99% general increase.

(2) To recommend to Full Council the General Fund revenue budget for 2025/26, as summarised in Appendices A and B of the report.

(3) To recommend to Full Council the savings proposals for 2025/26 as set out in Appendices C (i) and C (ii) of the report.

(4) To note the Equalities Impact Assessments on the budget proposals, as set out in Appendices C (iii) and C (iv) of the report.

(5) To note and endorse the report from the Budget Scrutiny Task Group in Appendix D of the report.

(6) To recommend to Full Council the HRA budget and business plan for 2025/26, as set out in section eight and appendix O of the report.

(7) To agree, for final approval by Council, the HRA rents for council dwellings, tenant service charges and garages as set out in section eight of the report.

(8) To agree the rents set under the Housing General Fund for Brent Housing PFI and traveller’s site pitches and to note the rents for Hillside dwellings as set out in section eight of the report.

(9) To note the Dedicated Schools Grant, as set out in section nine of the report.

(10) To recommend to Full Council the changes to the existing Capital Programme in relation to additions of new schemes and reprofiling, as set out in section ten of this report, and note the Capital Pipeline Schemes in Appendix E of the report.

(11) To recommend to Full Council the Capital Strategy, the Non-Treasury Investment Strategy, the Treasury Management Strategy and the Minimum Revenue Provision Statement as set out in Appendices F, G, H and I of the report.

(12) To recommend to Full Council the Reserves Strategy and schedule of reserves, as set out in Appendices J (i) and J (ii) of the report.

(13) To agree, and where relevant agree to recommend to Full Council the schedule of fees and charges, as set out in Appendix K (ii) of the report.

(14) To note the results of the budget consultation, as set out in section seven and detailed in Appendices L (i) and L (ii) of the report.

(15) To note the legal advice from the Corporate Director, Law and Governance, as set out in Appendix M of the report.

(16) To note the decision of the Corporate Director, Finance and Resources to continue as part of the Eight Authority Business Rates pool in 2025/26 as set out in section six of the report.

(17) To note the changes to waste policy, notably the Extended Producer Responsibility (ERP) for packaging from 2025 and agree to recommend to Full Council for the funding to be transferred to reserves in 2025/26.

To also note and approve the recommendations identified for consideration by Full Council as detailed in section 2.18 – 2.37 of the report.

Eligible for call-in: No (report and recommendations referred to Council)

Minutes:

Prior to consideration of the main report, Councillor Muhammed Butt (as Leader of the Council) advised that he had agreed various requests to speak in relation to the budget report and proposals.

As an initial contribution Councillor Conneely was invited, as Chair of the Resources and Public Realm Scrutiny Committee and Budget Scrutiny Task Group, to introduce the main findings and recommendations within the Budget Scrutiny Task Group report, which had been included as an appendix to the Budget and Council Tax report. In introducing the report, Councillor Conneely began by thanking all members of the Task Group and everyone else who had participated in the scrutiny process. In emphasising the ongoing nature of the financial challenges and pressures faced by the Council, Councillor Conneely reiterated the need for fundamental reform of the current way in which local authorities were funded, given what was widely regarded to be the inadequacy of the existing funding regime.

Having outlined the comprehensive nature of the process undertaken by the Task Group in reviewing the budget proposals Cabinet was advised that the key recommendations made had included a focus on:

· The need to review the way in which the use of funding generated through Strategic Community Infrastructure Levy could be maximised to provide optimal community benefit; and

· The way in which the Council’s commissioning and procurement arrangements could be enhanced to provide greater cost efficiency, value for money and social value.

In welcoming the contribution from the Scrutiny Budget Task Group, Councillor Muhammed Butt (as Leader of the Council) commended the thorough nature of the approach and robust challenge undertaken by the Task Group with the recommendations made as a result now subject to active consideration in terms of how they could be taken forward and way in which progress would be reported and monitored by scrutiny. The Leader thanked all those involved for their contribution as a key part of the budget consultation process.

As a further contribution the Leader then invited Councillor Lorber to speak who took the opportunity, in also recognising the financial crisis faced by local government, to highlight the £150m reserve of Strategic Community Infrastructure Levy (SCIL) funding held in Brent. Whilst aware of the restrictions in the permitted use of this funding, Councillor Lorber felt stronger representations needed to be made to the Government in seeking to ease the restrictions and provide greater flexibility and autonomy in how the Council could use this funding given the wider pressures and demands faced by key local services and in addressing what he felt to be the current poor state of the borough. In closing, he felt the £150m SCIL reserve identified could make a significant contribution towards addressing the issues residents were concerned about and therefore was keen to encourage ongoing lobbying of Government to allow Councils to decide how to spend that money and avoid the need for further cuts to services.

Having noted the representations and comments received, the Leader then invited Councillor Mili Patel (as Deputy Leader and Cabinet Member for Finance & Resources) to introduce a report from the Corporate Director Finance & Resources which set out the Council’s budget proposals for 2025-26 along with the results of the budget consultation, scrutiny and equality processes and the overall financial position facing the Council for the medium-term.

In presenting the report, Councillor Mili Patel began by outlining the extensive nature of the consultation undertaken with all key stakeholders to develop the budget proposals, before highlighting the challenging nature of the Council’s financial position, given the ongoing impact of the previous Conservative Governments programme of austerity and increasing levels of demand being experienced as a result of the homelessness and the social care crisis. Despite the delivery of £238m worth of cuts over the last decade Councillor Mili Patel felt it was important to recognise the way in which the fiscal discipline, established as a fundamental value by the current Administration in Brent, had ensured the foundations on which the Council stood remained strong, enabling the continued delivery of high quality services to residents and presentation of a fully balanced budget.

In recognition of the work undertaken in an effort to achieve this position, thanks were expressed to all officers, members (including the Budget Scrutiny Task Group), residents and stakeholders who had engaged in the budget consultation process with the outcome reflecting the Council’s ongoing commitment to undertaking the budget setting and consultation process and presenting the facts as clearly, accurately and transparently as possible.

Whilst recognising that the operating environment and wider economic context faced by the Council remained volatile, members were advised that as a result of careful financial stewardship, Brent had found itself in a position of precarious stability when compared to a number of other local authorities across London, who had been presented with little choice but to approach government for Exceptional Financial Support. These boroughs were having to borrow to avoid failure, which members were advised (given its unstainable nature) Brent remained determined to avoid. Although not immune to the pressures faced, with specific challenges identified in relation to the substantial in-year overspend on housing driven by rising homelessness alongside new financial strains in Children and Young People and Community Health and Wellbeing, increased build costs and levels of demand generated through an ageing population and ongoing impact of the cost of living crisis the considerable efforts to maintain financial control were recognised. In noting this process had included the identification of £8m worth of in-year savings designed to mitigate against the pressures outlined, members were reminded the financial landscape still remained extremely challenging with the Council, as a result, having little choice but to shape the financial plans and proposals outlined as part of the budget setting process around that reality and in the most equitable way possible.

Looking to the future, the plans announced by the Government for significant reform of local government across England and Wales were welcomed as a means of addressing the fundamental issues and concerns arising as a direct impact of the previous governments programme of austerity and in seeking to ensure that local government was provided with the foundations and ability to deliver what it was originally intended to do and not just act as a safety net or as the government’s emergency provider of last resort.

In highlighting Brent’s commitment to delivering not just essential services, but those that matter most to residents, the efforts being made to protect frontline services whilst also ensuring maximising value for taxpayers and continuing to seek improvements to services were identified as a key commitment. As an example reference was made to the ongoing work being undertaken to deliver new, safe and secure homes across the borough, raise standards for renters in the private sector, support those in fuel and food poverty, provide access to employment & training opportunities, keep Brent clean and on the move with a focus on infrastructure and the environment, maintain parks and open spaces, provide the best start in life for children and young people and dignity in the last stages of life through the social care offer with the only limit on the Council’s ambition identified as the golden thread of funding.

In concluding her introduction, Councillor Mili Patel once again highlighted how challenging development of the budget proposals had been. Cabinet Members and officers were thanked for their support in the process with it noted that despite the significant pressures identified the Council remained committed to supporting local residents across the borough, protecting the most vulnerable, and investing in Brent’s future with the budget proposals as presented therefore commended for approval and reference on to Council for formal adoption.

In supporting the budget proposals, contained within the report, Cabinet Members recognised the ongoing nature of the challenges and financial pressures identified and also took the opportunity to thank the finance team for their work in developing the budget proposals whist also seeking to safeguard, as far as possible, key services and support for local residents and businesses focussed around the Council’s core strategic priorities. In terms of specific pressures and priorities identified these had included:

· The ongoing pressures in relation to homelessness and the supply of housing to address increasing levels of demand across the borough with members commending the work being undertaken in seeking to mitigate against these pressures and in maintaining the Council’s commitment to increase the supply of genuinely affordable and accessible housing in as viable a way as possible. This had included the acquisition programme being delivered through i4B, which it was noted had delivered savings in excess of £4m in terms of the avoidance of Temporary Accommodation costs identified as one of the most significant financial pressures within the budget.

· The extension of the Household Support Fund as a key programme of discretionary support for residents across the borough financed by central government which would continue during 2025-26 to support Brent’s most vulnerable households, including funding free school meals provision outside of term time, dispensing welfare benefits and debt advice (contracting with organisations such as Citizens Advice and the Credit Union) supported through the Brent Hubs model.

· The continued support for children and young people despite the ongoing pressures identified in relation to school budgets, increasing demand for SEND provision and costs of residential placements, which it was felt highlighted the crisis in local government funding and urgent need for reform. In seeking to address the pressures identified within Brent, reference was made to the innovative approach adopted in relation to the establishment of a Children’s Residential Centre, which members were advised was on track to open during 2025 and was anticipated to save up to £400k in costs relating to the provision of childcare residential placements, as well as the enhancement of SEND provision through capital investment in a new SEND school within the borough. Reflecting on the challenges identified in relation to the funding pressures outlined along with the complexity of need in relation to many demand led services, the proposals contained in the Government’s Children and Wellbeing Bill and plans for devolution were felt to reflect a positive way forward and mandate for change, with support also expressed for the increasing focus on co-production, insourcing and partnership work as models of service delivery.

· Members also welcomed the aim to continue prioritising the most vulnerable in society whilst also seeking to protect essential services particularly in relation to health and adult social care with reference made, as an example, to the funding allocated within the budget for reablement as a means of supporting residents requiring care to live as independently as possible and avoid residential placements or extended stays in hospital as well as minimising the need for extended support following hospital discharge. This approach was also being supported by efforts to expand opportunities for the provision of care in community settings and modernisation of the Front Door access model working with customer services. The recognition of the impact relating to inflationary cost pressures and increase in demand on both adult and children’s care services and way in which these had been reflected within the budget was also welcomed, with support expressed for continued lobbying of government in relation to the One Public Purse approach towards public sector reform.

· The ongoing programme of work and investment in key highway and environmental infrastructure across the borough to ensure the borough remained clean, green and safe including the Don’t Mess with Brent campaign focussed around tackling fly-tipping and enhancing enforcement activity, programme of investment in highways and footways and utilisation of the additional funding being made available by the government to repair potholes which taken together would ensure the borough remained on the move and able to support the wider economy and programme of regeneration.

Prior to closing the debate, Minesh Patel (Corporate Director Finance & Resources) was then invited to update Cabinet on a number of amendments to funding details within the report following confirmation of the final Local Government Financial Settlement. The key changes outlined involved an increase in the ringfenced Children Social Care Prevention Grant from £1.3m to £1.4m and reduction in the funding being provided to cover the increase in National Insurance (NI) Employer contribution rates from £3m to £2.9m. Confirmation was, however, provided the revised rate would remain sufficient to cover the Council’s costs in relation to increased NI Employer contributions during 2025-26 for directly employed staff.

In summing up, Councillor Muhammed Butt felt it important to once again highlight the challenging nature of the budget setting process given the ongoing impact of the legacy created by the previous government. As a result, he welcomed the approach taken by all Cabinet Members and officers in seeking to review all aspect of their services to ensure budgets could be managed whilst delivering core strategic priorities and protecting the most vulnerable residents in the borough. Despite recognising the significance of the financial challenges identified and the level of funding cuts already delivered by the Council, he commended the approach adopted and measures outlined within the report which had been designed to ensure the Council was able to operate in a financially sustainable and resilient way whilst also seeking to delivery on key priorities and provide essential support for residents across the borough. This included a range of investments identified within section 4.39 of the budget report focussed on the delivery of 1,700 new safe and secure homes; raising standards for private renters; the maintenance of roads and pavements across the borough; improving Brent’s Libraries and providing funding support for community projects to empower local people and community groups to enhance their neighbourhoods; the delivery of 427 new school places for children with SEND within the borough and supporting over 4,600 elderly and vulnerable residents with vital social care support. Whilst development of the proposals had required difficult choices to be made these had been necessary to address the financial challenges faced as a result of what he felt had been the failures of the previous government. In thanking all those who had engaged in the budget consultation process along with Cabinet Members and officers (with specific reference to the finance team) for their support, Councillor Butt ended by highlighting the aim to ensure the process remained as open and transparent as possible and was focussed on enabling the Council to deliver a balanced budget whilst also seeking to maintain the provision of key services and essential support for residents across the borough.

Having noted the comments provided, and welcomed and supported the approach outlined within the report, Cabinet RESOLVED: