Cabinet approves five year financial plan
Bexley’s Cabinet approved the Medium Term Financial Strategy that sets out the Council’s five year plan for paying for local services and improvements at its meeting last night (11 July).
The Strategy covers both annual day-to-day spending on services for local people and £310m of longer-term investment in local improvements.
Successful long-term financial planning means that the Council is in a much stronger position than many other local authorities. This year more money has been found to improve services that residents believe should be a priority, including street cleaning, plus parks and grounds maintenance.
The Council’s plans for capital investment in the borough include -
• £120m investment on development schemes that will provide much-needed housing in the borough and that will generate rental income that the Council can use to fund other local public services.
• £18m on the regeneration of Erith.
• £12m on the borough’s infrastructure, environment and leisure facilities.
• £36m on the borough’s road and transport infrastructure.
“Our plans to make the borough an even better place to live are based on a firm foundation of careful financial planning,” said Cllr Don Massey, Deputy Leader of the Council. “We have had to make big adjustments because of changes to our funding over recent years, but we have managed this by improving our efficiency and transforming services to ensure we are spending our money on the things that make most difference to people’s lives.”
Bexley’s core government grant, which was £21m last year, will reduce to just £1.4m by 2021. The small number of other grants the Council receives are also reducing in number and value. This means that the amount the Council can spend is increasingly being dictated by the income it raises locally from business rates, council tax, fees and charges.
Economic growth is already happening in the borough and new investment and developments in the borough are having a positive impact - increasing income from council tax, business rates and rental and investment income. The more commercial approach recently adopted also means the council is increasing the income it raises through selling services.
The Council continues to face a range of spending pressures, including the cost of caring for a growing number of elderly people, more vulnerable young people, increasing numbers of children with special educational needs and rising homelessness, including those who have no recourse to other public funds.
The volatility of the economy is also an issue, particularly the prospect of rising inflation, which will increase the cost of services provided by external contractors.
These pressures, at a time when financial support from Government is falling makes the next few years a real challenge. Looking ahead, the Council is forecasting a budget gap of £5m for 2018/19, increasing to £12m by 2021/22. Plans to address this will be brought forward in the autumn as part of next year’s budget-making process.