Agenda and draft minutes

Apologies for absence were received from Councillors Brownridge and Fida Hussain.

Tere were no public questions for this Cabinet meeting to consider.

The Minutes of the meeting of the Cabinet held on 20^th January 2025 are attached for approval.

Resolved:
That the minutes of the meeting of the Cabinet held on 20^th January 2025, be approved as a correct record.

Draft Minutes attached.

Members considered the draft minutes of the Governance, Strategy and Resources Scrutiny Board held on 29^th January 2025.

It was reported that the Scrutiny Board had recommended to Cabinet and to the Council that all the budget reduction proposals considered, be approved.

Resolved:

That the deliberations and comments of the Governance, Strategy and Resources Scrutiny Board, held 29^th January 2025, be noted.

The minutes of the meeting held 6^th February 2025 will be circulated. The Liberal Democrat Group’s Budget Amendment Proposals for 2025/26, are attached for Cabinet Member’s consideration.

Consdieration was given to the minutes of the Opposition budget proposals for 2025/26, that were presented to the Governance, Strategy and Resources Scrutiny Board’s meeting on 6^th February 2025. The Scrutiny Board had recommended that the Cabinet consider the propoals submitted by the Liberal Democrat Group but reject the proposals that were presented by the Conservative,Group.

The Cabinet considered the proposals and summarised information in relation to the opposition group’s proposals for the 2025/26  budget.

Resolved:

1. That the deliberations and comments of the Governance, Strategy and Resources Scrutiny Board, held 6^th February 2025 be noted.
2. That, after consideration, none of the alternative budget proposals presented by the Liberal Democrats and Conservatives Groups be accepted.

A report that provides an update of the Council’s 2024/25 forecast revenue budget position, alongside the financial position of the capital programme together with the revised capital programme 2024/25 to 2028/29.

The Cabinet considered a report of the Assistant Director of Finance which  provided members with an update, as at 31^st December 2024 (Quarter 3) of the Council’s 2024/25 forecast revenue budget position (detailed at Annex 1, to the report), alongside the financial position of the capital programme together with the revised capital programme 2024/25 to 2028/29 (detailed at Annex 2 to the report).

In terms of the Revenue Budget, the forecast overspend position based on the Quarter 3 profiled budget was £10.634m which if not addressed would result in a year-end overspend of £14.178m (£20.390m at Month 8 (2024/25)). The submitted financial monitoring report followed on from the previously reported positions and warned on the potential year end position if no further action was taken to reduce net expenditure. The management actions already implemented for 2024/25 had been factored into the current forecasts. Work continues across the organisation to address this position and it was anticipated that by the year end, the current outturn deficit position should reduce even further.

An update on the Quarter 3 2024/25 position was detailed within Annex 1 to the  report.

Regarding the Capital Budget, he report outlined the most up to date capital spending position for 2024/25 to 2028/29 for approved schemes. The revised capital programme budget for 2024/25 was £87.260m at the close of Quarter 3 (£99.553m at Month 8), a net reduction of £12.293m. Actual expenditure to 31 December 2024 was £53.478m (61.23% of the forecast outturn).

Options/Alternatives considered:

The options that Cabinet could consider in relation to this report were:

a.    To consider the forecast revenue and capital positions presented in the report.

b.    To propose alternative forecasts.

The preferred Option was, to consider the forecast revenue and capital positions presented in the report.

Resolved:

1.    That the Cabinet notes the report.

2.    That the Cabinet approves the forecast profiled budget, being an adverse position of £10.634m at Quarter 3 (December 2024) and the forecast potential adverse position by year end of £14.178m, with mitigations in place to reduce expenditure as detailed at Annex 1, to the report.

3.    That the Cabinet approves the revised capital programme for 2024/25 including the proposed virements and the forecast for the financial years to 2028/29 as at Quarter 3 as outlined in Annex 2, to the report.

A report that provides details of the budget reduction requirement and the Administration’s budget proposals for 2025/26 and a forecast of the 2026/27 position having regard to the Provisional Local Government Finance Settlement (PLGFS). The report also presents the financial forecasts for the remainder of the Medium-Term Financial Strategy (MTFS) period 2026/27 to 2029/30.

The Cabinet considered a report of the Assistant Director of Finance that provided members with the budget reduction requirement, the Administration’s budget proposals for 2025/26, a forecast of the 2026/27 position having regard to the Provisional Local Government Finance Settlement (PLGFS) published on 18^th December 2024 and the subsequent Final Local Government Finance Settlement (LGFS) published on 3^rd February 2025. The report also presented the financial forecasts for the remainder of the Medium-Term Financial Strategy (MTFS) period 2026/27 to 2029/30.

The submitted report presented the Council’s Revenue Budget for 2025/26 together with the budget reduction requirement and the Administration’s budget proposals for 2025/26 including Council Tax intentions. It also provided a forecast of the 2026/27 position and the financial forecasts for the remainder of the MTFS period, 2027/28 to 2029/30.

A version of the Revenue Budget 2025/26 and 2026/27 and Medium Term Financial Strategy 2025/26 to 2029/30 - based on the Provisional Local Government Finance Settlement (PLGFS) received on 18^th December 2024, had been presented to the Governance, Strategy and Resources Scrutiny Board on 29^th January 2025. The Board scrutinised the report and the other reports on the agenda which formed a core part of the Council’s strategic financial planning framework and recommended them to Cabinet.

Section 1 presented an introduction to the report and explains the report format.

Section 2 sets out key Council Policies and Strategies including the Co-operative Council Values, Corporate Plan, Constitution and Rules of Procedure, as the framework within which the Budget has been prepared.

Section 3 presented the Local Government Finance Policy Statement which sets out the Government’s intentions to assist financial planning for Councils. It also details the impacts of the 2025/26 Provisional and Final LGFS which was the seventh consecutive one-year Settlement. This included key information in relation to overall funding levels, Council Tax referendum limits and grants for 2025/26.

Section 4 presented the 2024/25 revised budget and year end forecasts. The starting point for preparing the 2025/26 revenue budget estimates was the underlying base budget of £289.1m. The 2024/25 revenue budget forecast outturn position highlighted a current unfavourable projected variance of £14.2m; which will need to be financed from reserves. This was in addition to the general contribution from reserves of £10.8m towards the 2024/25 budget approved by Council in February 2024, plus contributions from other Earmarked Reserves for specific projects/initiatives of some £4.6m. This meant that the total contribution from reserves in 2024/25 would be £29.5m: a situation that was not sustainable and which had significantly reduced the financial resilience of the Council.

Section 5 summarised the proposed budget for 2025/26 and provided the context for the strategy adopted. It provided a budget forecast whereby £1.05m could be used to replenish reserves (a more detailed breakdown of the indicative budget for 2025/26 can be found at Appendix 7. To the report).

Section 6 presented a range of expenditure pressures that would contribute to the budget gap. In total they contributed £41.2m to the 2025/26 position, an  ...  view the full minutes text for item 9.

A report setting out the Capital Strategy for 2025/26 to 2029/30 together with the indicative capital programme for 2026/27 to 2029/30.

The Cabinet considered a report of the Assistant Director of Finance which set out the Capital Strategy for 2025/26 to 2029/30 and thereby the proposed 2025/26 capital programme, including identified capital investment priorities, together with the indicative capital programme for 2026/27 to 2029/30, having regard to the resources available over the life of the programme.

The Cabinet was informed that the Council’s Capital Strategy and capital programme were set over a five-year timeframe. The proposed Capital Strategy and programme for 2025/26 to 2029/30 takes the essential elements of the 2024/25 to 2028/29 and previous years’ strategies and programmes and moves them forward in the context of the financial and political environment for 2025/26. The Strategy does however include a longer-term vision, a forward look at those projects that are likely to run beyond the timeframe of the five-year strategy and programme period or be initiated subsequently. This covered a timeframe for the 10 years from 2030/31 to 2039/40. 

The format of the Capital Strategy reflected the requirements of the Prudential and Treasury Management Codes issued by the Chartered Institute of Public Finance and Accountancy (CIPFA). The strategy therefore presents:

·         A high-level long-term overview of how capital expenditure, capital financing and treasury management activity contribute to the provision of services.

·         An overview of how the associated risk is managed.

·         The implications for future financial sustainability.

The Capital Strategy was presented at Appendix 1, to the report. It had been prepared in 14 sections and ensured that Members were presented with the overall long-term capital investment policy objectives and resulting Capital Strategy requirements, governance procedures and risk appetite. The sections are:

1.    The Capital Strategy linked to the Council’s Corporate Plan (Ready for the Future), the Oldham Plan (Pride, Progress, Partnership), Creating a Better Place (CaBP) Programme, Medium Term Property Strategy (MTPS), Housing Strategy (HS), and Budget and Policy Framework.

2.    The Principles of the Capital Strategy.  

3.    Priority Areas for Investment.

4.    Affordability, Delivery, and Risk Associated with the Capital Strategy. 

5.    Knowledge and Skills.

6.    Treasury Management. 

7.    Long Term Loans. 

8.    Other Non-Treasury Investments.

9.    Capital Resources to Support Capital Expenditure.

10.Capital Investment and Disposal Appraisal. 

11.The Prioritisation of Capital Requirements.

12.The Procurement of Capital Projects.

13.The Measurement of the Performance of the Capital Programme. 

14.The Capital Investment Programme Board (CIPB).

The Strategy was aligned with the Creating a Better Place programme which is focused on building more homes for the borough’s residents, creating new jobs through regeneration, and ensuring Oldham is a great place to visit with lots of family friendly and accessible places to go. This also incorporates the Medium-Term Property Strategy and Housing Strategy, aiming to deliver its ambition in ways that contribute to a reduction in carbon emissions in support of the Council’s Green New Deal strategy.

Section 1 of the Capital Strategy highlighted the aims of the Capital Strategy and its links to the Council’s Corporate Plan (Ready for the Future) and the Oldham Plan (Pride, Progress,  ...  view the full minutes text for item 10.

A report presenting the Housing Revenue Account (HRA), the detailed budget estimates for 2025/26, the strategic estimates for the four years 2026/27 through to 2029/30 and outturn estimate for 2024/25.

The report sets out for the Housing Revenue Account (HRA), the detailed budget estimates for 2025/26, the strategic estimates for the four years 2026/27 through to 2029/30 and outturn estimate for 2024/25. The report also sets out the recommended dwelling, non-dwelling rents and service and concierge charges to be applied from April 2025.

The report sets out the HRA 2025/26 proposed original budget and the forecast outturn for 2024/25. The opportunity is also taken to present the provisional strategic budgets for 2026/27 through to 2029/30. HRA activities are a key element of the Council’s Housing Strategy (approved by Council on 10 July 2019) which aims to provide a diverse Oldham housing offer that is attractive and meets the needs of different sections of the population at different stages of their lives.

After taking all relevant issues into account, the projected financial position for 2024/25 was estimated to be a £1.643m favourable variance when compared to the original budget forecast for 2024/25 approved at the Budget Council meeting, 28 February 2024. Of this variance, £0.531m is due to increased rental income (mainly backdated rental income in relation to Holly Bank and Primrose Bank), £0.492m is a reduction in forecast capital spend., and the balance is across a number of areas, but mainly utility charges and aids and appliances. The HRA balances brought forward into 2024/25 were also £0.222m greater than had been forecast. The estimated balances at the end of 2024/25 are projected to be £21.214m, which would be sufficient to meet future operational commitments and the potential financial pressures identified in the risk assessment.

The 2025/26 position had been presented after allowing for a proposed increase in dwelling rents of 2.7%, an increase in non-dwelling rents in line with individual contracts, a nominal increase of 2% on service charges and the setting of Extra Care Housing concierge charges to fully recover costs. The majority of HRA tenants are either the recipient of Housing Benefit or Universal Credit and coupled with the recent increase in the Local Housing Allowance, it is assumed that the proposed increase in rents will not be an additional financial pressure to the majority of tenants.

The financial projections for the HRA over the period 2024/25 to 2029/30 show an overall reduction in the level of balances from £21.106m at the start of 2024/25 to £14.625m at the end of 2029/30. These will be supplemented by a new smoothing reserve that will be created to allow for a change in the Council’s Minimum Revenue Provision Policy (MRP), approved in December 2024. Although this will see a significant increase in overall HRA reserves each year until 2036/37, the balances accrued in this reserve will be fully required to pay MRP over the proceeding ten years. For the purposes of this report, the new smoothing reserve balance is not included in the figures shown, as it is not available to fund other HRA activity.

The HRA detailed budget for 2025/26 and strategic estimates for the four years 2026/27 to  ...  view the full minutes text for item 11.

A report detailing the Council’s Treasury Management Strategy.

The Cabinet received a report of the Assistant Director of Finance which presented the Treasury Management Strategy for 2025/26.

The report outlined the Treasury Management Strategy for 2025/26, the Annual Investment Strategy, Borrowing Strategy, and Prudential Indicators.

The Council is required through regulations supporting the Local Government Act 2003 to ‘have regard to’ the Prudential Code. It is required to produce an annual Treasury Strategy for borrowing and to prepare an Annual Investment Strategy setting out the Council’s policies for managing its investments and for giving priority to security and liquidity of those investments.

The Strategy for 2025/26 covers.

• Economic Update

• Prospects for Interest Rates

• The Current Balance Sheet and Treasury Position

• Liability Benchmark

• The Borrowing Strategy

• Debt Rescheduling

• The Investment Strategy

• Approved Counterparties, risk management and Investment Limits

• Treasury Indicators which limit the treasury risk and activities of the Council

The report therefore outlined the implications and key factors in relation to each of the Capital and Treasury Management issues, referred to above and makes recommendations with regard to the Treasury Management Strategy for 2025/26. The report also includes the most recently available economic background commentary which reflects the position as at December 2024.

The proposed Treasury Management Strategy is presented to Cabinet to enable scrutiny of the report before it receives further consideration by the Council on 6^th March 2025. The Cabinet was advised that the report had been considered at the Audit Committee, at its meeting on 30^th January 2025, where the recommendations, ontained therein were endorsed. The Assistant Director of Finnance reported that any comments from Cabinet will be incorporated into the report that is to be presented to Council.

Options/alternatives considered:

The Cabinet was informed that in order to comply with the CIPFA Code of Practice on Treasury Management, the Cabinet had no option other than to consider and commend the content of the report to Council. Therefore, no options/alternatives were presented.

Resolved:

That the Cabinet after a detailed consideration commends the report to Council, noting in particular:

a.    The Capital Financing Requirement (CFR) Projections as detailed at paragraph 2.4.1 of the report.

b.    The Projected Balance Sheet position as at 31^st March 2025 and future years as detailed at paragraph 2.4.1 of the report.

c.    The Liability Benchmark as detailed at section 2.5 of the report.

d.    The Borrowing Strategy for 2025/26 as detailed at paragraph 2.6 of the report.

e.    The Annual Investment Strategy as detailed at paragraph 2.7, of the report, including counterparties and treasury limits.

f.     The Treasury Management Prudential Indicators at detailed at paragraph 2.8 of the report.

A report detailing the Council’s Pay Policy.

The Cabinet considered a report of the Assistant Director of Finance which described that under Section 112 of the Local Government Act 1972, the Council has the ‘power to appoint officers on such reasonable terms and conditions as the Authority thinks fit, subject to Section 41 of the Localism Act 2011’.

The submitted Pay Policy Statement (the ‘Statement’) sets out the Council’s approach to pay policy in accordance with the requirements of Section 38 to 43 of the Localism Act 2011.

The purpose of the Statement is to provide transparency and accountability with regard to the Council’s approach to setting the pay of its employees. It excludes teaching and other school staff working for the Local Authority under the purview of a School Governing Body. It identifies:

•      The methods by which salaries of employees are determined.

•      The detail and level of remuneration of its most senior staff, i.e. ‘chief officers’, as defined by the relevant legislation.

•      The Committee(s) responsible for ensuring the provisions set out in this statement are applied consistently throughout the Council and recommending any amendments to the full Council.

Resolved:
that the report be noted.

A rpeort seeking approval for an updated Armed Forces Covenant for Oldham Council

The Cabinet considered a report of the Assistant Director (Strategy and Performance), which sought approval of an updated Armed Forces Covenant for Oldham Council.

The Council has a statutory duty under the Armed Forces Act 2006, as amended by the Armed Forces Act 2021, to pay due regard to the Armed Forces Covenant principles when exercising certain functions.

Prior to the implementation of the statutory duty under the Armed Forces Act 2021, the Council chose to pledge its commitment to the Armed Forces community by promising to honour the Armed Forces Covenant. This pledge was last made in 2013. In 2017 the Council received the Armed Forces Covenant Employer Recognition Scheme Silver Award, and this was renewed in 2022. Since 2021, the Council has consistently gone beyond its duty to the Armed Forces community, as evidenced in this report.

To further build on its work, this report recommends that the Council shall re-pledge its promise to honour the Armed Forces Covenant, and that the endeavours relating to its support of the Armed Forces community, as detailed in this report, shall be noted. An application for the Armed Forces Covenant Employer Recognition Scheme Gold Award is to be made prior to 12 March 2025. 

Options/alternatives considered:

Option 1: To note the support the Council is already providing to the Armed Forces community along with other workstreams underway and approve that Oldham Council shall make a new pledge that it will honour the appended Armed Forces Covenant. This will allow the Council to display its re-affirmed commitment to supporting the Armed Forces community.

Option 2: Note the support the Council is already providing to the Armed Forces community, along with other workstreams underway, but do not approve a new pledge that Oldham Council will honour the appended Armed Forces Covenant. This will reflect poorly on Oldham Council, with the previous covenant pledge being made 11 years ago.

The preferred Option is Option 1.

Resolved:

1.    To note the support the Council is already providing to the Armed Forces community along with other workstreams underway.

2.    To approve a new pledge that the Council will honour the appended Armed Forces Covenant.