Agenda item - Report of the Cabinet - 25 February 2019

10.2 Councillor Rachael Robathan spoke in favour of the recommendations set out in the Cabinet report and Councillor Adam Hug made the first Opposition Speech and in doing so moved the amendment in his name as set out on the Order Paper which was seconded by Councillor David Boothroyd.

10.3 Following debate to which Councillor Aiken replied, the Lord Mayor put the Amendment to the recommendations in paragraph 1 of the Cabinet report moved by Councillor Adam Hug and seconded by Councillor David Boothroyd and on a roll call vote undertaken by the Chief Executive, there voted:

For amendment one: Councillors Barraclough, Begum, Boothroyd, Bush, Butler-Thalassis, Carman, Dimoldenberg, Hug, Less, Lewis, Mann, McKie, Noble, Qureshi, Roca, Talukder and Taouzzale.

Against amendment one: Councillors Acton, Aiken, Adams, Arzymanow, Barnes, Beddoe, Bott, Bright, Burbridge, Caplan, Chalkley, Devenish, Elcho, Flight, Freeman, Gassanly, Glanz, Glenn, Green, Angela Harvey, David Harvey, Hitchcock, Hyams, Mitchell, Mohindra, Murphy, Payne, Rigby, Robathan, Rowley, Scarborough, Shearer, Short, Smith, Swaddle, Warner and Wilkinson.

Absence or not voting: The Lord Mayor, and Councillors Cox, Dean, McAllister and Toki.

10.4 The Lord Mayor declared Amendment one to be LOST.

10.5 The Lord Mayor advised that the voting was on the unamended recommendations of the Cabinet in paragraph 1 of the Cabinet report – 2019-2020 Budget. The Lord Mayor put the recommendations of the Cabinet in paragraph 1 to the vote and on a roll call vote undertaken by the Chief Executive there voted:

For the recommendations: Councillors Acton, Aiken, Adams, Arzymanow, Barnes, Beddoe, Bott, Bright, Burbridge, Caplan, Chalkley, Devenish, Elcho, Flight, Freeman, Gassanly, Glanz, Glenn, Green, Angela Harvey, David Harvey, Hitchcock, Hyams, Mitchell, Mohindra, Murphy, Payne, Rigby, Robathan, Rowley, Scarborough, Shearer, Short, Smith, Spencer, Swaddle, Warner and Wilkinson.

Against the recommendations: Councillors Barraclough, Begum, Boothroyd, Bush, Butler-Thalassis, Carman, Dimoldenberg, Hug, Less, Lewis, Mann, McKie, Noble, Qureshi, Roca, Talukder and Taouzzale.

Absence or not voting: The Lord Mayor, Councillors Cox, Dean, McAllister and Toki.

10.6 The Lord Mayor declared the recommendations in paragraph 1 of the Cabinet report ADOPTED.

RESOLVED:

That full Council:

1. Approved that the local element of Council Tax for 2019/20 is increased by 2.1% (CPI inflation as at December 2018) for a Band D equivalent household;

2. Approved the 2019/20 budget, as set out in Appendix 1 to the report and the Tax levels as set out in the Council Tax resolution at Annex C to the report;

3. Approved that the local element of Council Tax is increased by 2% in respect of the Adult Social Care Precept as permitted by Government and anticipated in their Core Spending Power assumptions;

4. Approved that as a consequence of the 2.1% change in Council Tax and the 2% increase in the Adult Social Care precept, the local element for Band D properties be confirmed for 2019/20 as £433.34;

5. Approved that subject to their consideration of the previous recommendation, the Council Tax for the City of Westminster, excluding the Montpelier Square area and Queen’s Park Community Council, for the year ending 31 March 2020, be as specified in the Council Tax Resolution in Annex C to the Cabinet report. That the Precepts and Special Expenses be as also specified in Annex C for properties in the Montpelier Square and Queen’s Park Community Council;

6. Approved that the Council Tax be levied accordingly and that officers be authorised to alter the Council Tax Resolution as necessary following the final announcement of the Greater London Authority precept;

7. Noted the budget proposals presented to Council on 7 November 2018 which were approved in principle pending the completion of relevant external consultations as outlined in Paragraph 10.17 of Appendix 1 to the report;

8. Considered the views of the Budget and Performance Task Group set out in Annex A of Appendix 1 to the report;

9. Noted that the draft cash limited budgets for each General Fund service with overall net expenditure for 2019/20 of £180.436m (as set out in Schedule 3 of Appendix 1 to the report);

10. Approved that the Section 151 officer be required to submit regular reports as necessary on the implementation of the savings proposals and on the realisation of pressures and mitigations as part of the regular budget monitoring reports;

11. Approved that the Section 151 officer be delegated responsibility for any technical adjustments required to be made to the budget (in line with the Council’s Financial Regulations);

12. Approved that the cost of inflation, pressures and contingency be issued to service budgets if and when the need materialises, to the limits as contained within Schedule 4d signed off by the Section 151 officer;

13. Noted the views of consultees and the consultation approach, as set out in section 10 of Appendix 1 to the report;

14. Approved the Council continues as previously agreed to make recurrent additional £4m contributions as part of the on-going annual contributions as set out in paragraph 7.6 of Appendix 1 to the report;

15. Approved that the previously approved use of new capital receipts be used under the freedoms of the Flexible Capital Receipts regulations be used to fund revenue expenditure on City Hall, Digital Programme and Pension Deficit Recovery programmes which lead to future ongoing savings (and subject to review at year end to determine the actual costs, savings and financing by the Section 151 officer);

16. Approved that the proposed use of new capital receipts be used under the freedoms of the Flexible Capital Receipts regulations to finance future revenue expenditure on other relevant and applicable programmes which arise in the future during the duration of the regulations and which lead to ongoing savings (and subject to review at year end to determine the actual costs, savings and financing by the Section 151 officer);

17. Approved that the Section 151 officer be delegated responsibility to transfer any potential surplus Business Rates revenue into a reserve to mitigate the potential impact of business rates volatility and to support future years’ revenue budgets;

18. Approved that to the extent that the Council is unable to mitigate the CCG funding reductions through novating contracts across to the NHS, through service contracts coming to the end of their natural term, or through allocation from the social care support grant or business rates levy grant, then Council reserves may be used in 2019/20 to offset the pressure and balance the Council’s budget;

19. Approved the Council continues the Westminster Community Contribution to allow the most expensive (Band H) properties in the city to voluntarily contribute towards supporting discretionary services that support the three priorities of youth services, helping rough sleepers off the streets and helping people who are lonely and isolated;

20. Received and noted the Equality Impact Assessments included in Annex B to Appendix 1 to the report to inform the consideration of the budget after approval.

10.7 The Lord Mayor put the recommendations in paragraph 2 of the Cabinet report, Capital Strategy 2019-2020 to 2023-2024, Forecast Position for 2018-2019 and Future Years Forecasts summarised up to 2032-2033 to the vote and there voted on a roll call vote undertaken by the Chief Executive.

For the recommendations: Councillors Acton, Aiken, Adams, Arzymanow, Barnes, Barraclough, Begum, Beddoe, Bott, Boothroyd, Bright, Burbridge, Bush, Butler-Thalassis, Carman, Caplan, Chalkley, Devenish, Dimoldenberg, Elcho, Flight, Freeman, Gassanly, Glanz, Glenn, Green, Angela Harvey, David Harvey, Hitchcock, Hyams, Hug, Less, Lewis, Mitchell, Mohindra, Murphy, Mann, McKie, Noble, Payne, Rigby, Robathan, Roca, Rowley, Scarborough, Shearer, Short, Smith, Spencer, Swaddle, Warner and Wilkinson, Qureshi, Talukder and Taouzzale.

Against the recommendations: None.

Absence or not voting: The Lord Mayor, Councillors Cox, Dean and McAllister.

10.8 The Lord Mayor declared the recommendations in paragraph 2 of the Cabinet report ADOPTED.

RESOLVED:

That full Council:

1. Approved the capital strategy as set out in the report attached as Appendix 2.

2. Approved the capital expenditure for the General Fund as set out in Appendix A to the report attached as Appendix 2 for 2019/20 to 2023/24 and future years to 2032/33.

3. Approved the capital expenditure forecasts for the General Fund as set out in Appendix A to the report attached as Appendix 2 for 2018/19 (Period 8).

4. Approved the expenditure forecast for 2018/19 (Period 8) for the HRA as set out in Appendix B to the report marked as Appendix 2.

5. Approved the capital expenditure for the HRA for 2019/20 to 2023/24 as in accordance with the 30 year HRA Business Plan and as included in Appendix B to the report attached as Appendix 2.

6. Approved the financial implications of the HRA capital programme including the references to the debt cap and the level of reserves as detailed in Section 8 to the report attached as Appendix 2.

7. Approved that in the event that any additional expenditure is required by a capital scheme over and above this approved programme the revenue consequences of this will be financed by revenue savings or income generation from relevant service areas.

8. Approved that all development and investment projects, along with all significant projects follow the previously approved business case governance process as set out in paragraphs 5.1 and 6.5 to 6.14 to the report attached as Appendix 2.

9. Approved that no financing sources, unless stipulated in regulations or necessary agreements, are ring fenced.

10. Approved that contingencies in respect of major projects are held corporately, with bids for access to those contingencies to be approved by the Capital Review Group (CRG) in the event that they are required to fund capital project costs, as detailed in Sections 12.11 to 12.14 to the report attached as Appendix 2.

11. Approved the council plans to continue its use of capital receipts to fund the revenue costs of eligible proposals (subject to full business cases for each project). This comes under the MHCLG Guidance on the Flexible Use of Capital Receipts (FCR), if considered beneficial to the Council’s finances by the City Treasurer at year-end. (The Council’s strategy for flexible use of capital receipts is outlined in section 11 to the report attached as Appendix 2).

12. Noted the continued use of flexible use capital receipts (as approved at November Council) to fund revenue costs associated with City Hall, Network and Telephony Transformation and Technology Refresh projects as detailed in section 11.9 and 11.14 to 11.28 to the report attached as Appendix 2.

13. Noted the Council’s proposal to make use of £400m of forward borrowing to finance the capital programme and subsequently reduce the longer-term revenue impact, as approved by Full Council in November 2018.

14. Approved the financing of the capital programme and revenue implications as set out in paragraphs 14.1 to 14.30 to the report attached as Appendix 2.

15. Approved the financing of the capital programme being delegated to the City Treasurer at the year end and to provide sufficient flexibility to allow for the most effective use of Council resources.

10.9 The Lord Mayor put the recommendations in paragraph 3 of the Cabinet report – Housing Investment Strategy and Housing Revenue Account Business Plan 2019-2020 to the vote and on a show of hands declared the recommendations ADOPTED.

RESOLVED:

That the full Council:

1. Approved HRA capital programme budgets for 2019/20 to 2023/24 as attached in Appendix B to the report attached as Appendix 3.

2. Approved the HRA revenue budget for 2019/20 as detailed in Sections 8,11 and Appendix C) to the report attached as Appendix 3.

3. Approved the adjustment of HRA capital budgets in 2018/19 to match the assumptions within this Business Plan as detailed in Appendix B to the report attached as Appendix 3.

10.10 The Lord Mayor then put the recommendations in paragraph 4 of the Cabinet report – Treasury Management Strategy Statement for 2019-2020 to 2023-2024 to the vote and on a show of hands declared the recommendations ADOPTED.

RESOLVED:

That the Council:

1. Approved the Treasury Management Strategy Statement;

2. Approved the borrowing strategy and borrowing limits for 2019/20 to 2023/24 set out in sections 5 to 7 to the report attached as Appendix 4;

3. Approved the prudential Indicators set out in section 8 to the report attached as Appendix 4;

4. Approved the Annual Investment strategy and approved investments set out in Appendix 1 to the report attached as Appendix 4;

5. Approved the Minimum Revenue Provision Policy set out in Appendix 2 to the report attached as Appendix 4.

10.11 The Lord Mayor then put the recommendations in paragraph 5 of the Cabinet report – Integrated Investment 2019-2020 to the vote and on a show of hands declared the recommendations ADOPTED.

RESOLVED:

That the Council:

a) Approved and implements the Integrated Investment Framework set out in the report attached as Appendix 5;

b) Approved that the target for the overall return on Council investments should aspire to match inflation;

c) approved that the benefits of investing in the Pension Fund should be used as a benchmark when evaluating other investments;

d) adopted the asset allocation percentages set out in the Framework and work towards achieving these;

e) agreed that the overarching objective of this Framework is to achieve an overall return on Council investments aspiring to match inflation and to reduce costs and liabilities, whilst maintaining adequate cash balances for operational purposes, and not exposing the capital value of investments to unnecessary risk;

f) approved that investments allocated to out-of-borough property developments should be considered individually and should outweigh the benefits of investing in-borough (which can have a number of non-commercial benefits, e.g., place making) and in a diversified property portfolio (acquisitions will be made out of borough only on an exceptional basis). Individual decisions should be subject to Cabinet Member approval;

g) Approved that the property and alternative asset allocation should focus on in-borough, with out of borough options being explored on an exceptional basis and subject to Cabinet Member approval;

h) Approved the Investment Executive to implement, monitor and report on the investment strategy.

10.12 The Lord Mayor then put the recommendations in paragraph 6 of the Cabinet report – Pay Policy 2019-2020 to the vote and on a show of hands declared the recommendations ADOPTED.

RESOLVED:

1. The Pay Policy for 2019/20, attached as Appendix A to the report attached as Appendix 6.

Supporting documents: