Business community consultation

The Council will propose its 2020/21 budget through its Revenue Estimates and Council Tax report to be published on 14 February 2020. This report will be put to Council for consideration and approval on 2 March 2020.

If any business rates payers would like to make any comments or request further information or a meeting to discuss the budget proposals before then, please contact Jason Blackhurst on 020 7974 4729 or write to jason.blackhurst@camden.gov.uk by 7 February 2020.

 

 

Financial challenge

Since 2011, core government grant funding has been reducing each year. In December 2018, the Council forecast a growing budget deficit over the three years to 2021/22 of £35m to £40m, from a combination of rising demand and cost pressures coupled with government funding reductions.

In order to address this, Cabinet considered and approved a programme of savings and investments designed to ensure the Council can continue to operate on a sustainable and sound financial footing. The proposals were developed using outcomes-based budgeting, and involved a detailed, evidenced-based examination of how the Council can best use the reduced resources available.


The Review of Medium-term Financial Strategy report to Cabinet in December 2019 sets out the council’s latest forecast and a progress update on year 1 of the strategy. The December report also provided detail on preparations towards setting the 2020/21 budget. 

 

Supporting business

Camden’s aim is to be the best place to do business in London. Camden Business Board brings together representatives from our major businesses associations and key growth sectors to jointly lobby on big issues including broadband infrastructure, air quality and employment and skills. The Board also co-produces the Camden Business Charter, the Council’s commitment to business.

We have made significant enhancements to the customer experience for business. For instance, the online Business Account was relaunched in 2017 with many new features, making it easier than ever to run your business in Camden.

In line with Camden Plan objectives, we continue to harness the benefits of economic growth with new workspace provision secured through planning obligations and our own Community Investment Programme. When complete, the Town Hall refurbishment project will deliver additional affordable work space and business incubator space that will be made available to our local SMEs.

The Council continues to partner with its suppliers to bring greater benefits to the local business community through our social value approach. The Council has been a LLW Accredited organisation for 7 years. We continue to ensure that contractually we take every opportunity to incorporate LLW within our tenders. 

Growth in Camden should be strong and inclusive – everyone should be able to access the work that is right for them. So when we work with external contractors in the future, they will be asked what ‘social value’ they can add to the local community. From offering apprenticeships and work placements to our young people and paying and promoting the London Living Wage, to giving our schools free technology and volunteering staff time at community projects in Camden, there will be many different ways they can support our residents as part of our new social value framework.

Business rate changes

The Autumn Budget 2018 announced that for two years from April 2019, all retail premises with a rateable value below £51,000 will have their bills reduced by one third. 

The two main elements of a business rate bill - rateable value, which is based on the open market rental value of property, and the business rate multiplier, which is used to calculate bills - are determined by the Valuation Office Agency. This is a central government agency and Camden Council has no control over rateable values nor the multiplier, statutory discounts or reliefs. 
 

Business rate retention

Prior to 2013/14, councils handed business rates they collected to the government and received a share back as part of overall government grant. In 2013/14, the government implemented reforms which allows councils to retain a proportion of the business rates they collect in exchange for a reduction in their grant funding. 

For the last two years Camden, along with all London authorities and the GLA, have been participating in a pilot scheme to pool business rates income across the capital and retain an increased proportion of any business rate income growth, as the government sought to make moves towards greater local financial autonomy.

Camden welcomed the pilot pool approach as a step towards wider devolution. We have strongly supported the principle that Councils should retain more funding generated locally as part of our advocacy of wider devolution as a means of improving outcomes by moving decisions closer to the residents and businesses they effect. We argue that services that have a direct relationship to business should be transferred to councils including services that can help tackle key infrastructure challenges, including housing, transport and digital connectivity. In turn, we are creating a circular economy by encouraging greater participation of SMEs through our procurement processes.

The 2019 Spending Round announced that the implementation of a new model for Business Rates would be deferred again, to April 2021, creating more uncertainty around local authority finances in the medium term. While Local Authorities will continue to benefit from a share of business rates above an agreed baseline, the retention rate for London will reduce from 75% to 67% of income above the baseline with the GLA keeping 37% and councils keeping 30%.

If the Council operated outside of a business rates pool, it would be required to pay a 50% levy on the business rates income growth it retained. However, London Councils Leaders’ Committee have agreed in principle to support a pool for London under the 67% retention rates. The benefit of a London wide pool would be that collectively, London would pay a lower levy rate on growth than the individual authorities would if they operated outside of the pool. 

The government previously stated its intention to hold a new Spending Review in 2019, covering the 3 year period 2020/21 to 2022/23. However, with the political turbulence around Brexit, the Government has only provided a one-year Spending Round covering the financial year 2020/21. This has given local authorities limited assurance in terms of their financial stability for the coming financial year, and there is no funding certainty beyond this point and no indication of when a fuller and longer term plan for public sector spending will be available.

The Review of Medium-term Financial Strategy report to Camden’s Cabinet in December 2019 set out an overview of the council’s financial position, including our plans to address the medium term funding deficit and an update on preparations towards setting the 2020/21 budget. See the supporting documents below and have your say on proposals.
 

Supporting documents

A number of additional supporting documents are also provided on this Council’s financial strategy website. The most recent documents provided for the December update are:

Financial Strategy Update – Dec 2019
This report provides an update of the council’s 3-year savings programme. 


2019/20 Financial Outturn Forecast Update (Month 6 - September)
This report provides an update on the revenue and capital financial forecasts for 2019/20 as at quarter 2, and notes any significant risks that have been identified as having the potential to affect the outturn as currently projected.

The Council can provide further information on its revenue or capital estimates for next year on request.