This meeting was about the budget for Lewisham Council in the 2025-26 financial year and included a report from officers outlining the proposed budget and the council tax levels for the coming financial year. Alongside this, there were also reports on the responses of the Mayor and Cabinet to recommendations made at the previous meeting, declarations of interest, and the committee's work plan.

Council budget 2025-26

The committee was asked to review the proposed budget for 2025-26, which would then be considered by the Mayor and Cabinet at their meeting on 12 February 2025.

The budget report set out the Council's current financial position and the assumptions underpinning the budget. For the General Fund, the budget assumed net revenue expenditure of £334.260 million.

Given that Lewisham's population is growing, and the cost of many of the services it has a statutory duty to provide are increasing, in order to deliver a balanced budget, the report set out a number of budget reduction proposals, growth funding allocations and an intention to use £21.745 million of reserves. This use of reserves was driven by the need to fund service pressures such as a forecast £37.2 million overspend for 2024-25, which if funded in full from reserves would equate to more than 50% of the Council's earmarked reserves being depleted.

Furthermore, the report also included a Council Tax Ready Reckoner to illustrate the amount of Council Tax payable by a resident in a band D property in 2025/26, under a range of possible council tax increases, and the financial implications of this for the Council. The report set out a proposed council tax increase of 4.99% for 2025/26, which included a 2.99% increase in Core Council Tax, in line with the provisional Local Government Finance Settlement, and a 2% increase for the Adult Social Care precept, which Government has committed to for another year.

The report also outlined the budget and associated risks for the Housing Revenue Account, which is forecast to overspend by £3.8 million in 2024-25. This overspend is largely due to the costs of responsive repairs and maintenance for existing housing stock exceeding the budgeted level. To ensure that the HRA remains in balance, as it is legally required to, the report proposed an increase in average dwelling rents of 2.7% (an average of £3.26 per week) and an increase in hostel accommodation charges of 2.7% (an average of £1.07 per week). This will bring the average weekly rent for a Lewisham Council property to £123.89.

Alongside the core budget, the report also set out Lewisham Council's Climate Budget for 2025-26 to 2027-28. The climate budget sets out the Council’s carbon emissions for the period 2018/19 – 2022/23. In that period, the Council's direct emissions have reduced by just over 25%. The budget also assessed the total estimated cost of full decarbonisation of both its corporate and housing assets as being £694 million.

The final element of the budget report was the presentation of the proposed Fees and Charges to be applied to the Council’s chargeable services. In the main, fees and charges for discretionary services were proposed to increase in line with the Council’s policy to increase by CPI plus 1% in 2025/26. The report also included proposals to charge for new services such as food waste collection for commercial businesses to meet new statutory requirements.

Responses from Mayor and Cabinet

The committee considered the response of the Mayor and Cabinet to referrals made at the previous meeting of the Public Accounts Select Committee held on 28 November 2024.

The first of the recommendations from the previous meeting asked the Mayor and Cabinet to remodel the proposal P03: Reduced Leisure Concessions. In response to this recommendation, officers have agreed to model the impact of a number of suggestions put forward by the Healthier Communities and Safer and Stronger Communities Select Committees and to present this information to Executive Members for their consideration.

The second recommendation from the previous meeting, requested that the Mayor and Cabinet to revise proposal P01: Ending the Funding for the Council run Assembly Programme. The response from the Mayor and Cabinet was that the Council wants to work more closely with community groups and others with reach and influence in the local area. This would involve using learning from the response to the Covid-19 pandemic and engaging residents through multiple approaches rather than a standard set of Assembly meetings.

Select Committee work programme

The committee was asked to review its draft work programme for the 2024-25 financial year.

This included the following items for discussion at the next meeting, for which the committee was asked to agree steers for officers preparing reports:

• IT and Digital Services – Digital Strategy
• Customer Service and Resident Experience

The committee was also asked to consider a number of items on the Council's Forward Plan of Key Decisions to assess whether any should be added to its work programme for further scrutiny.

This included consideration of a number of decisions on topics that had been referred to other committees, including the procurement of enforcement agents for the collection of council tax and business rates, and the adoption of a new Local Development Scheme. It also included decisions yet to be taken by the Mayor and Cabinet, including the award of a contract for Extra Care Services at Conrad Court, and the proposed extension of the Change, Grow, Live contract for adult substance misuse services. This contract is currently held by Insight Lewisham, a social enterprise that delivers substance misuse services across a number of London Boroughs.