Item 11 - Proposed Revenue Budget and borough subscriptions and charges 2016/17 (L8/12)

Summary    

This report proposes the level of boroughs subscriptions and charges to be levied in 2016/17, together with the consolidated revenue income and expenditure budget for 2016/17. The report also updates Leaders’ on the current level of London Councils reserves after considering all current and proposed commitments and the timetable for the overall budget approval process. These proposals were considered by the London Councils Executive at its meeting on 17 November and this package was agreed for submission to this Committee for final consideration and approval.

These proposals involve:

•    The payment of £1.651 million from uncommitted reserves to boroughs in 2016/17, an average repayment of £49,727;
•    A reduction of £5,515 per borough in the borough subscription for the Joint Committee for 2016/17; and
•    Total reductions of £617,000 from the operation of the TEC direct services in 2016/17, producing an average saving of £18,147 per borough and for TfL.

The total proposed savings and repatriation of funds to boroughs for 2016/17 amounts to £2.423 million, or an average of £73,424 per borough, which, for illustrative purposes, is an amount that equates to 44% of the level of the current Joint Committee subscription of £167,473. 

2016/17 is the final year of the current commissioned Grants Programme.
Members will be making decisions this winter about the programme for April 2017 onwards that could impact upon the potential for further reductions in the budgets agreed in the autumn/winter of 2016.
 

Recommendations    

The Leaders’ Committee is asked to approve the following borough subscription and charges:

•    The proposed Joint Committee subscription for boroughs of £161,958 per borough for 2016/17, a reduction of 3.3% on the charge of £167,473 for 2015/16. The City of London will pay £158,195, in recognition of the fact the City is historically not part of the regional Local Government Employers (LGE) arrangements (paragraphs 11-12); 
•    The proposed Joint Committee subscription for the MOPAC and the LFEPA of £15,410 for 2016/17, a reduction of 3.3% on the charge of £15,920 for 2015/16 (paragraph 13);
•    An overall level of expenditure of £10 million for the Grants Scheme in 2016/17 (inclusive of £2 million gross ESF programme); and
•    that taking into account the application of £1 million ESF grant,  net borough contributions for 2016/17 should be £9 million, the same level as for 2015/16 (paragraphs 14-16).
The Leaders’ Committee is also asked to endorse the following subscription and charges for 2016/17 for TEC, which were considered by the TEC Executive Sub-Committee on 24 November,  and which will be considered by the full meeting of TEC on 10 December:
•    The Parking Core Administration Charge of £1,500 per borough and for TfL (2015/16 - £1,500) (paragraph 17); 
•    No charge to boroughs in respect of the Freedom Pass Administration Charge, which is covered by replacement Freedom Pass income (2015/16 - £8,674) (paragraph 19); 
•    The net Taxicard Administration Charge to boroughs of £338,182 in total (2015/16 - £338,182); (paragraph 20);
•    No charge to boroughs and TfL in respect of the Lorry Control Administration Charge, which is fully covered by estimated PCN income (2015/16 – no charge) (paragraph 21); 
•    The Parking Enforcement Service Charge of £0.4681 per PCN, which will be distributed to boroughs and TfL in accordance with the number of PCNs issued in 2014/15 (2015/16 - £0.4333 per PCN; paragraphs 24-25);
•    The Parking and Traffic Appeals Charge of £33.32 per appeal or £29.90 per appeal where electronic evidence is provided by the enforcing authority (2015/16 - £33.40/£29.97 per appeal).In addition, a new differential charge is proposed for hearing Statutory Declarations of £28.17 for hard copy submissions and £27.49 for electronic submissions (2015/16 - £33.40/£29.97 per SD) (paragraphs 26-27); 
•    Congestion Charging Appeals – to be recovered on a full cost recovery basis, as for 2015/16, subject to the continuing agreement of the GLA under existing contractual arrangements (paragraph 28);
•    The TRACE (Electronic) Charge of £7.31 per transaction (2015/16 - £8.60) (paragraphs 29-31); 
•    The TRACE (Fax) Charge of £7.48 per transaction (2015/16 -   £8.80) (paragraphs 29-31); and
•    The PEC, PED and PIE Charges of £0.17 per transaction (2015/16 - £0.20) (paragraphs 29-31).
On the basis of the above proposed level of subscriptions and charges, the Leaders’ Committee is asked to approve:
•    The provisional consolidated revenue expenditure budget for 2016/17 for London Councils of £398.193 million, as per Table 4 at paragraph 32 and Appendix A of this report;
•    The provisional consolidated revenue income budget for 2016/17 for London Councils of £398.193 million, also as per Table 4 at paragraph 32 and Appendix B;
•    Within the total income requirement, the use of London Council reserves of £2.469 million in 2016/17, inclusive of the proposed £1.651 million repatriation to borough in 2016/17, as detailed in paragraph 3, Table 12 at paragraph 56 and Appendix C. 
The Leaders’ Committee is also asked to note:
•    The indicative London Councils revenue budget, for the period 2017/18 and 2018/19, as detailed in paragraphs 51-53;

•    The position in respect of forecast uncommitted London Council reserves as at 31 March 2016, as detailed at paragraphs 54-60; and

•    The positive statement on the adequacy of the residual London Councils reserves issued by the Director of Corporate Resources, as detailed in paragraphs 61-62.

 

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