The Cabinet of Newham Council met on Tuesday 15 October 2024 to discuss the council's performance, financial position, and housing revenue account. Key decisions included noting the Building a Fairer Newham Quarterly Performance Report, approving updates to the Housing Revenue Account Business Plan, and agreeing to a series of measures to address the council's financial challenges, including budget adjustments and the initiation of consultations on potential savings.

Building a Fairer Newham Quarterly Performance Report 24/25

The Cabinet noted the progress made during the first quarter of the 2024/25 financial year in delivering the Building a Fairer Newham Strategy and its Corporate Delivery Plan. This included updates on key performance indicators, responses to the Local Government Association's (LGA) Corporate Peer Review, and the mobilisation of the Newham Transformation Plan. Councillor Sarah Jane Ruiz, Deputy Mayor and Cabinet Member for Environment, Sustainable Transport, Children’s Services and Education, highlighted positive achievements within her portfolio, such as the opening of the Shipman Youth Zone and the recognition of care experience as a protected characteristic. However, concerns were raised about the clarity of performance indicators and the need for more accessible reporting for residents. Councillor Neil Wilson, Cabinet Member for Health and Adult Social Care, pointed to significant progress in adult social care, including winning an ODC Award for the Independent Living Support Service Trusted Assessor Initiative, and a reduction in rough sleeping figures. Councillor Charlene McLean, Cabinet Member for Resident Engagement and Resident Experience, noted a disparity between resident engagement, which was performing well, and resident experience, particularly concerning the contact centre's core answering rates.

Housing Revenue Account (HRA) Business Plan Update

The Cabinet agreed to note the updated Housing Revenue Account (HRA) Business Plan for 2024. A key decision was the approval of a £44 million programme to acquire approximately 125 new homes, funded by 100% of Right to Buy receipts. This reallocation of existing Affordable Homes for Newham 2 budget marks a shift from historic practice, where only a portion of receipts could be used for such acquisitions. Additionally, the Cabinet approved proposals to refund council tenants in relation to historic water charges, estimated to total £7.96 million. Councillor Shaban Mohammed, Cabinet Member for Housing Management and Modernisation, emphasised the importance of social housing as a resource to offer stable homes and highlighted ambitious plans for investment in existing homes to ensure they are warm, efficient, and safe. He also noted the significant financial pressures faced by the council due to reduced income and increased costs in managing homes, alongside the need for safety and decarbonisation investments.

October Finance Papers - Quarter Two 2024/25 Budget Monitoring and Review

The Cabinet agreed to a series of recommendations aimed at addressing the council's significant financial challenges. These included noting the financial forecasts and management actions outlined in Appendix C, and agreeing that budgeted expenditure on certain items detailed in Appendix A would not be expended in-year as originally planned. Furthermore, the Cabinet resolved to recommend to the Council that these items be removed from the budget for 2025/26 and future years. Work will commence on increasing fees and charges, excluding parking, by an average of 20% where permitted, to achieve in-year savings in the final quarter of the 2024/25 financial year. The Cabinet also agreed to begin consultations on specific items detailed in Appendix B, with the intention of including them in the 2025/26 budget or earlier if feasible. Councillor Zulfiqar Ali, Cabinet Member for Finance and Resources, highlighted the scale of the financial crisis facing local government, particularly acute in London due to the homelessness crisis, with a forecast budget gap of £175 million over three years, £100 million of which is attributable to temporary accommodation costs. He stressed the need for tough decisions and a razor-like focus on identifying further savings. Conrad Hall, Corporate Director of Resources and statutory chief finance officer, echoed the difficult financial position, noting that the proposed savings of £175 million over three years represent over 40% of the council's net annual revenue budget. He emphasised that addressing the systemic failure in the London housing market would require government support.

The meeting also discussed the council's transformation programme, with savings of £23 million planned over three years. Councillor Charlene McLean raised concerns about the potential impact of savings on resident engagement and experience, while Councillor Neil Wilson highlighted the pressures in adult social care and the need for preventative work. The review of the library service was also discussed, with an emphasis on it being a review rather than necessarily leading to closures.

The Cabinet noted that lobbying of central government on the financial position continues and acknowledged an update to the Capital Monitoring Report regarding the Digital Fibre Grant Funded project being added to the Capital Programme.

The meeting concluded with thanks to the finance and resources team for their work on the papers presented.