The funding crisis facing Brent Council

The current round of Brent Connects forums (this week there is one for Wembley on Tuesday (see side bar for details) will hear a presentation about the Borough plan.  That plan will incorporate a worsening financial situation for the borough over the next 4 years which seems unlikely to be mitigated by any change of government.

This is the budget cycle for the 2015-16 budget:

The Council Tax Base shows a slight increase due to increased population and more properties being built in the borough. Additionally more people are paying Council Tax after the Council Tax Support changes. However Central Government funding of local authorities continues to reduce. New Social Care legislation which caps the amount people pay and a reduction in parking charges revenue also affect the picture.

The overall impact is a reduction in funding of £50 by 2018-19:

It is also likely that changes in education funding nationally will see a decrease in London, and of course Brent, after 2015 with some envisaging school budget cuts of 12%.

The report LINK going to the Cabinet tomorrow contains the usual structures on legality:

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A local authority must budget so as to give a reasonable degree of certainty as to the maintenance of its services. In particular, local authorities are required by the Local Government Finance Act 1992 to calculate as part of their overall budget what amounts are appropriate for contingencies and reserves. The Council must ensure sufficient flexibility to avoid going into deficit at any point during the financial year. The Chief Financial Officer is required to report on the robustness of the proposed financial reserves.

Under the Brent Member Code of Conduct members are required when reaching decisions to have regard to relevant advice from the Chief Finance Officer and the Monitoring Officer. If the Council should fail to set a budget at all or fail to set a lawful budget, contrary to the advice of these two officers there may be a breach of the Code by individual members if it can be demonstrated that they have not had proper regard to the advice given.

This is the source of the claim, likely to be heard at Brent Connects, that the Council has no alternative but to administer Coalition cuts.

'Parking, Potholes & Poo' or politics?

At a hustings in Mapesbury earlier this week a Liberal Democrat candidate said that the local election was about efficient emptying of bins and clean streets and not about 'political grand themes'. This was a swipe at my fellow Green Shahrar Ali, whose speech had identified the democratic deficit on Brent Council and the iniquity of privatisation and the bedroom tax.

The Lib Dem candidate was right in a way:  no one is going to say they are FOR fly-tipping, overflowing bins, litter strewn streets or pavements smeared with dog excrement. However the allocation of resources to deal with those issues is a political issue - both within the Council and in terms of government resources allocated to local authorities. The extent to which services are out-sourced and the wages and working conditions of sub-contractors are a political issues. The Council's stand on the privatisation of schools and whether it makes a principled stand on the undemocratic process of forced academisation is a political issue.

It is also important to consider how these decisions are made by councillors and that brings into consideration whether decisions are arrived at through debate and rigorous scrutiny or are mere rubber stamping of officer reports. Opposition and Labour backbenchers find they are excluded from this decision making and instead have to focus on the 'parking, potholes and poo' casework. How good they are at that is not a matter of political affiliation but of personal efficiency. An added, but reduced concession, is their role in allocating ward working money.

Lastly the controversy over the Davani affair brings into sharp focus the relationship between the political administration and officers. If the administration sees itself as a management organisation - managing the cuts, managing the school places crisis, managing procurement - it puts political principle aside and the Executive and Corporate Management Team become a single management entity.

In my view this is not a matter for personal attacks, although the current issue has become highly personal because of the huge impact it has made on people's lives and livelihoods, but of questioning why some of the most senior officer positions in the council are in effect out-sourced to people who have set themselves up as self-employed consultants.

This means that at its very core the Council has acquiesced in the Coalition's privatisation agenda - handing public money over to private companies.

A further dimension is the issue, discussed on this blog many times, of the relationship between the Council and developers, or more specifically the relationshing between the Major Projects, Regeneration and Planning Department and developers. With the Council seeing its role as smoothing the way for developers, local residents find themselves locked out of the discussion and the decisions. They become mere irritants in the joint projects of the council and its favoured property developers. Behind this is the political issue of reduced funding for local government and therefore the need for the Council to find other sources of revenue through increasing its council tax base through high density, often unaffordable, housing developments; Community Infrastructure Levy and the New Homes Bonus LINK

Of course it suits the Lib Dems to focus on street level issues and to be photographed pointing at fly-tips, because it takes attention away from their role as Coalition partners in undermining the financial stability and the viability of local authorities.

Protest over London Mayor grabbing the New Homes Bonus

New Homes Bonus is granted to councils in recognition of the pressures they and their communities face when new housing is built in their borough. For example, the cost of more people using locally delivered services, such as adult care or libraries, or investment in infrastructure.

The Autumn Statement announced that, from 2015, London boroughs will face a cut of £70 million in the New Homes Bonus. It also announced that outside of London the New Homes Bonus will not be given to Local Enterprise Panel (LEPs), as had been originally proposed, but would instead continue to go to the councils who deliver local services. The government has, however, decided that in London the New Homes Bonus will be given to the London Local Enterprise Panel, chaired by the Mayor of London.

Chair of London Councils, Mayor Jules Pipe, said:

All Londoners should be outraged by this move. If the New Homes Bonus is essential for councils in Leeds and Manchester to fund the pressures of growth, why should Londoners be any different? This must be reversed.

The very fact that it has been proposed raises fundamental questions about the governance of the growth agenda in London and the government’s commitment to it.