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(Budget), Mayor and Cabinet - Wednesday, 12th February, 2025 6.00 pm

February 12, 2025 View on council website
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Summary

The meeting of the Mayor and Cabinet of Lewisham Council on the 12th of February 2025 was about the budget for the coming year. The main item scheduled for discussion was the 2025/26 Budget Report 1. Other items included the formal adoption of the updated Local Development Scheme 2, the extension of the contract for Insight Lewisham, the substance misuse and sexual health service for young people, and a review of the garage assets owned by the council.

Council Budget

The main item in the reports pack for the meeting was a 2025/26 budget report 3.

The report sets out the income and expenditure for the council's general fund, its housing revenue account, and for local schools. The document also describes the council’s planned capital expenditure 4 over the coming years, and its treasury management strategy 5.

General Fund

The report pack proposed a budget requirement of £312,515,000 for the council's general fund, to be funded as follows:

  • An assumed increase of 4.99% in council tax. This would be broken down into a 2.99% increase to fund general services and a 2% increase to fund adult social care.
  • £138,890,519 in funding from central government.
  • £21,345,000 from the Section 31 grant 6.
  • £21,745,000 from council reserves.

The report sets out that for the current 2024/25 financial year, the general fund is forecast to overspend by £26,000,000, with a forecast overspend of £37,200,000 partially mitigated by £11,200,000 drawn from reserves. It says that the overspend will need to be covered from reserves.

The report identifies the main pressure on the general fund is from the increase in the cost of temporary accommodation, and says that it is forecast to cost the council £29,500,000 in the current year, with the number of people in temporary accommodation in the borough having increased by 40% since March.

The report also identifies an overspend of £14,200,000 in the Children and Young People directorate. It says that the main reasons for this are an increase in the cost of care for looked after children and an increase in the demand for special education needs provision, resulting in a £17,400,000 overspend in the High Needs Block of the Dedicated Schools Grant 7.

Dedicated Schools Grant

The reports pack said that the council is expected to receive £395,950,000 in funding from the Dedicated Schools Grant (DSG) in the 2025/26 financial year, a 9.7% increase on the amount received in the 2024/25 financial year.

Housing Revenue Account

The reports pack said that the Housing Revenue Account is forecast to overspend by £3,800,000 in 2024/25, slightly lower than previously forecast. It says that the overspend is mainly caused by the need to invest more in the repairs service than previously budgeted for.

The report proposes that rents for council homes are increased by 2.7% in 2025/26, and service charges are increased to recover the full costs of delivering those services. This would include a £6 per week increase to the average charge for heating.

Local Development Scheme

The report pack contains an updated version of the Local Development Scheme. The scheme sets out the timetable for the preparation of the new Local Plan.

Insight Lewisham

The reports pack proposed that the contract for Insight Lewisham 8 be extended by two years.

Garage Asset Review

The reports pack recommends that the council declare 14 of the garage sites it owns to be surplus to requirements, and authorises their disposal.

It also proposes that £548,856 is allocated to fund improvements to the other garage sites that are to be retained by the council.

  1. The budget is a financial plan that sets out how Lewisham Council plans to raise and spend money over a period of time. The 2025/26 Budget Report sets out the income and expenditure planned for the 2025/26 financial year. ↩

  2. The Local Development Scheme is a document that sets out how Lewisham Council will prepare its planning policy documents over the coming years. ↩

  3. This is the council's main bank account. It covers money the council raises from council tax, business rates, and government grants. It also covers money the council spends on services, such as adult social care, children's services, and libraries. ↩

  4. This is money that the council spends on physical assets, such as buildings, roads, and equipment, rather than spending on the day to day running of the council. ↩

  5. This sets out how the council will manage its borrowing and investments. ↩

  6. This is a government grant that compensates councils for losses in business rate income. The majority of councils’ income from business rates is paid over to central government. Councils keep a proportion of this income and they receive funding from central government to make up the difference. In recent years the amount councils have received from the Section 31 grant has been increasing because business rates income has been lower than forecast. ↩

  7. This is a grant from the Department for Education that covers the cost of pupils with Special Education Needs (SEN) attending schools. There is a national shortage of school places for pupils with SEN, and so the funding that councils receive from central government is not sufficient to cover the costs of providing these school places. This has led to an increase in the overspend for SEN pupils. ↩

  8. Insight Lewisham is a service that provides support to young people in the borough who are experiencing problems with substance misuse and/or sexual health. It is provided by WayThrough, a charity that provides a range of services to young people. ↩

Decisions to be made in this meeting

Attendees

Documents