Shaping our next Budget 2021/22

Overview

The draft Medium-Term Financial Strategy (MTFS) was presented to Leadership Team on Wednesday 11 November 2020 including details of key saving and investment proposals.

The MTFS provides the financial framework underpinning delivery of the Council’s priorities.

The Council has a budget pressure of £45.9m over the next three years driven by projected increases in demand for services such as housing and social care, changing economic conditions, and a much greater reliance on income generated locally rather than government grant funding.

The Council also faces uncertainties including the continuing impact of Covid-19, Brexit, and the future of local authority funding. It is therefore proposed that reserves are maintained at prudent levels to protect service delivery from the potential financial impacts of these uncertainties.

The recovery from the Covid-19 pandemic and ongoing recovery from the Grenfell tragedy will remain priorities for Kensington and Chelsea, as the Council consults on next year’s budget. Financial plans include funding to implement the Council’s commitment to the London Living Wage and a proposal to earmark up to £8m of Council Reserves to fund the Borough’s recovery from Covid-19. The £50m Grenfell Recovery Strategy budget continues to be protected.

The budget gap is in part driven by £5m of budget growth to meet pressures on service delivery recognising the increased demand for services and the changing needs of our residents and vulnerable households. Services across the Council have identified £10m of budget savings to help balance the budget while aiming to ensure front line services and delivery of Council Plan priorities aren’t adversely affected. At this point a budget gap still remains.

Capital expenditure plans have also been reviewed with £66.4m of new investment proposed to ensure the effective running of Council services and the things that matter to residents including building new homes, investing in our council housing, supporting education, and improving our streets and connectivity in the borough, all of which will help to create jobs, opportunities and build a better future for the borough.

Why your views matter

It is very important that our residents, businesses and other key stakeholders have a say in this draft MTFS and help to ensure the Council fulfils its obligations to set a balanced budget for 2021/22.

A summary of the new saving and investment proposals listed by Council Plan Priority is provided.