Agenda and minutes

There were no declarations of interest received at this point in the meeting.

The minutes of the Executive meeting held on 14 February 2024 were submitted and approved as a correct record.

The Mayor provided an update on the Council application for Extraordinary Financial Support (EFS) stating that positive, albeit informal, discussions had taken place with the Department for Levelling Up, Housing and Communities. A final decision on EFS would be brough to the Council’s budget meeting on 8 March.

SUSPENSION OF COUNCIL PROCEDURE RULE NO. 4.13.2 – ORDER OF BUSINESS

In accordance with Council Procedure Rule No. 4.57, Executive agreed to vary the order of business to deal with the items in the following order: 6,4,5,7 and 8.

The Mayor and Executive Member for Adult Social Care and Public Health submitted a report for Executive’s consideration.

The report set out the Council Plan 2024-27 and sought Executive endorsement on its structure and content, setting out how the Council would work with its communities, to take forward its shared priorities over the 2024 to 2027 period.

The intent of the report was to provide enough information and assurance for the Executive to endorse the Council Plan 2024-27, prior to consideration by full Council on 8 March 2024, ensuring that it remained current and reflective of major developments of the past year, and those anticipated in the coming three years.

The Council Plan, formerly known as the Strategic Plan, was the Council’s overarching business plan for the medium-term, and was refreshed on an annual basis, setting out the priorities of the Elected Mayor of Middlesbrough, the ambitions of Middlesbrough’s communities and the ways in which the Council sought to achieve them.

Part of the Council’s Policy Framework, the Council Plan required the approval of full Council, as set out in the Constitution. The Council’s Budget and Policy Framework Procedure Rules provided for the Executive to draw up firm proposals on the Strategic Plan (Change Strategy) for submission to Full Council.

Full Council approved the previous Strategic Plan 2021-2024 on 16 February 2021, which expressed the previous Mayors’ priorities for the town.

This report proposed a new Council Plan for the 2024-27 period articulating the aims and ambitions of Mayor Cooke elected in May 2023, which are informed by, and responsive to the views of residents and which will need to be delivered within available resources.

ORDERED that Executive endorses the final Council Plan 2024-27 and associated strategic priorities and outcomes prior to full Council approval of the final Council Plan 2024-27 and to enable development of detailed, supporting delivery plans.

OPTIONS

It was imperative that the Council effectively articulated and communicated an overarching plan to direct activity across Directorates and services, towards the achievement of its priorities and ambitions.

The only other realistic potential decision would be to leave the Council’s strategic objectives unchanged on the assumption that they were sufficiently robust to address and achieve previously identified outcome measures. This, however, was not correct and would not have represented an appropriate response to the needs of the town. It would also have detrimentally impacted local communities and the business of the Council for some years ahead.  

The only other feasible decisions, therefore, relate to the structure of the document, and its horizon (i.e., reverting to an annual plan). It was strongly in the Council’s interest to plan over the medium-term, (between 3 – 5 years) in line with the indicative budgets over this period outlined by the Government. The proposed document achieved this whilst also providing an appropriate level of detail for all audiences on the Council’s planned activity over this period.  

REASONS

To enable the Executive to endorse, prior to consideration by full Council, the Council Plan 2024-27,  ...  view the full minutes text for item 23/76

The Mayor and Executive Member for Adult Social Care and Public Health submitted a report for Executive’s consideration.

The Mayor advised Executive of an amendment to Appendix 5 of the report which was tabled at the meeting and circulated to Members.

The report proposed a 2024/25 net revenue budget of £143.190m, and Medium-Term Financial Plan (MTFP) for the period 2024/25 to 2026/27 following the confirmation of the Local Government Finance Settlement and set out the financial planning assumptions applicable to the budget based upon the best information available at the time.

A Council tax increase for 2024/25 of 4.99% was proposed, comprising 2% Adult Social Care Precept and 2.99% Core Council tax which was within the referendum limits set by Government.

The report proposed a Capital Programme of £88.549m for 2024/25 and totalled £174.980m over the period from 2024/25 to 2026/27 together with a financing statement comprising a combination of external funding and council resources. In addition, the proposed capital strategy set out the Council’s approach to capital investment and financing, including the forecast levels of borrowing and the Minimum Revenue Provision (MRP) Policy which governed how the Council accounted for debt repayment in accordance with statutory regulations. The Capital programme provided for EFS of £13.4m to be financed from borrowing over a period of up to 20 years whilst the actual amount and terms would be determined by the s151 Officer, based upon the actual requirements, borrowing rates and an assessment of revenue affordability at the appropriate time during the 2024/25 financial year.

A summary of the Schools’ Budget and allocation of the Dedicated Schools Grant (DSG) as determined under the Department for Education’s (DfE’s) National Funding Formula, together with an overview of the financial pressures on the DSG High Needs Block and forecast deficit which was being addressed under the Delivering Better Value (DBV) Programme.

The s151 Officer’s recommended Reserves Policy for 2024/25 set out the plan for replenishing and maintaining usable revenue reserves over the period of the MTFP in order to achieve financial recovery and re-establish the Council’s financial resilience.

The s151 Officer’s recommended Fees and Charges Policy sets out the proposed framework within which discretionary charged for services would be reviewed and fees and charges set in the future in order to ensure financial viability of discretionary services.

The report was underpinned by the Section 151 Officer’s report in accordance with s25 of the Local Government Act 2003 which assessed the robustness of budget estimates and the adequacy of financial reserves in the context of the known financial risks that existed in the Council’s operating environment. The report set out the responsibilities of all officers and members to work collaboratively together in order to enable the Council to successfully navigate the complex and challenging path to recover its financial position and achieve financial sustainability over the medium term. Under s31A of the Local Government Finance Act 1992, the Council was required to have regard to this report when making decisions on agreeing the budget and  ...  view the full minutes text for item 23/77

The Executive Member for Children’s Services submitted a report for Executive’s consideration.

The report presented the revised plans to achieve savings of £0.450m in 2025/26 and £0.615m in 2026/27, totalling £1.065m by the end of the current MTFP period on 31 March 2027 (reference: 24/25 CC03).

Further, it was anticipated that a further saving of £0.850m would be achievable in 2027/28 which was beyond the current MTFP period. This plan aimed to deliver a total saving of £1.915m over a 4-year period, replacing the original saving of £1.848m that was incorporated into the 2023/24 budget to deliver £0.787m in 23/24 and £1.061m in 2024/25 which had been determined to be undeliverable as originally planned. Due to the operational activity being brought online during 2024/25 the savings will be realised from 2025/26.

The Children’s Services Financial Improvement plan approved in February 2023 included elements of increasing the in-house estate for Children’s care. During the course of the 12 months significant efforts were made to identify suitable properties to bring online. These efforts were hampered for two key reasons:

1.    At the commencement of the year significant time was spent exploring a large property which could have met the needs of our 16+ cohort. Months exploring this including the refurbishment feasibility were undertaken, however it transpired there were issues with the refurbishment and build that had already been undertaken which would have left a legal liability on the local authority to resolve. The focus on this area led to a delay in project achievements.

2.    The cost of refurbishment, when seeking to convert any existing council asset to a residential home were prohibitive and did not represent value for money. This had therefore led to a strategy for future consideration being the identification of suitable properties with minimal renovation work required.

Under the revised plan, Middlesbrough Council would reduce the use of the external high-cost placements and grow the residential and supported accommodation offer, by increasing Middlesbrough Council’s in house offer and building partnerships with commissioned providers.

Middlesbrough Council’s residential and supported accommodation occupancy was mainly high (residential homes 95% in January 2024, supported accommodation 100% and higher needs supported lodgings 78%), which meant that Middlesbrough Council could not place any more children in their own lower costing, higher quality residential and supported accommodation placements.

Instead, Middlesbrough Council were using external organisations to provide homes for Middlesbrough children and young people, which on average, comes at a higher cost than Children’s Services provides. On average, Middlesbrough Council residential homes cost £3,300 per week to operate, and on average currently the average cost of an external residential children’s home placement was £5,600 per week.

Middlesbrough Council had forecast that the current active 76 external residential placements for children with a total forecast cost of £14.4m for 2023/24 (after contributions from Health and Education as of December 2023).

The Executive Member for Children’s Services thanked officers for their involvement in the creation of the report.

ORDERED that Executive approve the revised approach which  ...  view the full minutes text for item 23/78

The Executive Member for Finance and Governance submitted a report for Executive’s consideration.

The report outlined the Council’s prudential indicators for the financial years 2024/25 – 2026/27 and set the framework and approved the limits within which the treasury management operations for this period. It fulfilled key legislative and guidance requirements:

a.    The setting of the prudential indicators in relation to the expected capital activities and treasury management prudential indicators (included as treasury indicators) in line with the Chartered Institute of Public Finance and Accountancy (CIPFA) Treasury Management Code of Practice.

b.    The treasury management strategy statement which set out how the Council’s treasury function would support capital decisions taken above, day to day treasury management activities on service delivery and any limitations on these, via the treasury prudential indicators.

c.     The approval of the Council’s Minimum Revenue Provision (MRP) Policy, which set out how the Council would pay for borrowing to fund capital investment through the revenue budget each year.

d.    The key indicator was the Authorised Limit, the maximum amount of debt the Council could enter into during the financial year. This amount acted as the legal limit for debt activity.

e.    The investment strategy which set out the Council’s criteria for choosing the investment counterparties and limiting exposures to the risk of loss.

The information contained in the report regarding the Council’s capital expenditure plans, Treasury Management and Prudential Borrowing activities indicated that they were:

·         Within the statutory framework and consistent with the relevant codes of practice.

·         Prudent, affordable, and sustainable.

·         An integral part of the Council’s Revenue and Capital Medium Term Financial Plans.

ORDERD That Executive review, endorse and recommend for approval and adoption at the Council meeting on the budget on 8 March 2024:

1)    Approve the Prudential Indicators and limits for 2024/25 to 2026/27 relating to capital expenditure and treasury management activity set out in tables 1 to 10 of Appendix 1.

2)    Approve the Treasury Management Strategy for 2024/25, which included the Annual Investment Strategy for 2024/25 at Appendix 1 of the report.

3)    Approve the Minimum Revenue Provision (MRP) Policy for 2024/25 at Appendix 1 of the report.

4)    Approve an Authorised Limit for External Debt of £372m for the 2024/25 financial year.

OPTIONS

It was a statutory requirement to approve the annual treasury management strategy and set of prudential indicators by the Council.  As a result, there were no alternatives submitted as part of the report.

REASONS

The recommendations requested would fulfil the following for the local authority:

1)    Compliance with the Prudential Code for Capital Finance in Local Authorities and the Department for Levelling Up, Housing & Communities (DLUHC) guidance on investments.

2)    Compliance with the Treasury Management Code of Practice for Local Authorities.

3)    Compliance with the requirements of the Local Government Act 2003 Part 1.

4)    To approve a financial governance framework within which officers will operate when making both borrowing and investment decisions and entering financial transactions.

None.

All decisions will come into force after five working days following the day the decision(s) was published unless the decision becomes subject to the call in procedures.