Issue - meetings

To consider a report detailing Cabinet’s initial budget proposals and associated matters.

Cabinet considered a report which sought approval to the Cabinet’s initial budget proposals in the context of a refreshed Our North Tyneside Plan 2020-24. The proposals covered a four-year planning period from 2020-24 for the Revenue Budget and a five-year planning horizon for the Investment Plan.

The 2019/20 financial year was the final year of the 2016 Spending Review, which had afforded local government some financial certainty with which to plan over the medium term.  The lack of a multi-year Spending Review had meant that there was a significant level of uncertainty when undertaking financial planning for the longer term.  Political uncertainty remained high.  Brexit had been delayed until 31 January 2020 and the forthcoming General Election had caused delays for major funding announcements. The initial proposals had therefore been prepared on the basis of assumptions included in the Spending Round 2019 (SR19) announced in September.

The SR19 was limited to a single year, which included headline numbers for Government spending for 2020/21 and indicative three-year allocations for schools.  In addition, SR19 confirmed the Government’s proposal to ‘roll forward’ the 2019/20 Local Government Finance Settlement.  Specific funding allocations were yet to be confirmed and a full multi-year Spending Review was now planned to be held in 2020.  The main headlines announced in SR19 included:

•           Departmental spending to increase by 4.1% in real terms, whilst keeping within the Government’s fiscal rules;

•           Social care grants received by local authorities in 2019/20 would continue in 2020/21;

•           The Improved Better Care Fund would be maintained at 2019/20 levels, and the Winter Pressures Grant (£240m allocated in 2019/20) would be rolled into the Fund for 2020/21;

•           An additional £1bn of grant funding would be distributed for social care in 2020/21, plus local authorities would be able to charge a further 2% Adult Social Care Precept;

•           A real terms increase in the Public Health and Revenue Support Grant; and

•           Authorities would be able to increase Band D Council Tax up to 2% for the basic element in line with the referendum limit for 2020/21.

Consultation with Government was underway on the basis of distribution of the additional social care grant.  However, initial indications were that the Authority would receive additional social care funding of £4.300m in 2020/21.

SR19 also included a three-year funding settlement for schools, high needs and early years which were part of the Dedicated Schools Grant (DSG).  Nationally, additional funding would be £2.6bn in 2020/21, £4.8bn in 2021/22 and £7.1bn in 2022/23.  The main headlines announced included:

•           An increase in per pupil funding for all schools in line with inflation in 2020/21 (1.8%) with minimum per pupil funding levels set at Primary £3,750, Key Stage 3 £4,800 and Key Stage 4 £5,300;

•           Minimum rate per pupil for primary schools rising to £4,000 in 2021/22;

•           Additional funding of £700m in 2020/21 for children with special educational needs;

•           Additional early years funding of £66m;

•           Additional funding of £400m in 2020/21 for further education;

•  ...  view the full minutes text for item 70