Introduction

Dear Reader,

I am pleased to present the statement of accounts for the London Borough of Bexley for the financial year 2023/24.

My narrative report includes the financial statements with an overall explanation of the Council’s financial position during 2023/24 and commentary on the medium-term picture. It also includes information about the operation of the Council and the major influences affecting the accounts. In addition, it includes information on service and financial performance over the financial year ending 31 March 2024. All this information is given with the aim of providing stakeholders and interested parties assurance as to the Council’s financial standing and the care taken to account for public money.

Performance overview 2023/24

Background

Bexley is all about its residents – who make the borough so enterprising, diverse and full of character. Our 250,000 residents are proud of their well-located and green borough, and the council is ambitious for them, working to grow the borough for the benefit of residents today and into the future.

A new corporate strategy was adopted in 2022/23 – our Bexley Plan ‘Making Bexley Even Better’. This plan is how we share our vision for Bexley and our commitments to residents in delivering that vision. The Bexley Plan is linked to our Medium-Term Financial Strategy (which explains how we will resource and fund the vision and commitments).

• Find out more about our Bexley Plan

In our new Bexley Plan we have three priorities and 15 outcomes:

Priority theme 1: Aspiration for our residents

Outcome 1 - Children and young people have the best start in life
Outcome 2 - Good schools and achievement for all our pupils
Outcome 3 - Lifelong learning helps people reach their potential and access good jobs
Outcome 4 - Happy, healthy and resilient lives
Outcome 5 - Your life, your choice - working together towards the life you want

Priority theme 2: Ambition for our Borough

Outcome 6 - Good growth supported by better transport
Outcome 7 - Cleaner and greener borough 
Outcome 8 - Local jobs and businesses in a thriving local economy 
Outcome 9 - People and communities feel safe and inclusive 
Outcome 10 - Quality, affordable homes for every stage of life 

Priority theme 3: An Efficient and Effective Council

Outcome 11 - Lobbying for Bexley and on the side of our residents 
Outcome 12 - Taxpayers’ money is spent wisely and well 
Outcome 13 - Customers at the heart of what we do 
Outcome 14 - Rigorous procurement and contract management to get the best services 
Outcome 15 - Attract, retain and develop an efficient, diverse and inclusive workforce

Our approach to delivering our ‘Bexley Plan’

We have a two-fold approach to ensuring we deliver our Bexley Plan.

Our Bexley Plan now includes an action plan, and we monitor delivery of the projects and activity within it to make sure we remain focused on our priorities. Each year of activity is part of our bigger vision for Bexley, and each year we make further progress towards making Bexley even better.  This was our second year delivering against a four-year plan.

We also continue to monitor an agreed set of performance indicators that relate to our Bexley Plan outcomes. In 2023/24 we monitored over 110 of these corporate performance indicators. Some of the performance indicators are only the responsibility of the Council but many of them are shared and achieved in partnership with colleagues across the public and voluntary sector.

We share and update our performance and achievements regularly at Public Cabinet, as it’s important to be open about how we’re doing. We provide numerical data and written explanations to make the information clear and accessible.  We are a learning organisation, and our performance this year helps us plan and adapt for next year and future years, supporting the council to agree evidenced ways to improve performance.

It is important to understand and show the link between our performance, our resources and our financial outturn so that we are open about any risks or challenges in achieving our vision and commitments. We produce an integrated performance report to make sure that our performance indicators help us manage risk, manage our finances, and provide good governance.

Our overall performance in 2023/24

We’ve achieved a great deal this year, in a difficult context, as inflation has continued to increase our costs and cost of living pressures have continued to increase the levels of need for some residents. Some of our performance indicators aren’t meeting the target we aimed for, but we are often performing well compared with other authorities. Key examples of which are detailed below by Bexley Plan priority.

Priority theme 1: Aspiration for our residents

We were proud to gain an Outstanding Ofsted report of our Children’s Social Care Services in May 2023, making us only the second local authority in the country to have achieved two successive findings of ‘Outstanding’ under the current Ofsted framework.

This year we’ve seen an 11% reduction in referrals to our Children’s Social Care this year and the rate of Children in Need and children with child protection plans have also reduced, the latter by 22%.

Our Staying Together team won funding this year to develop their parent conflict support programmes and continued their fantastic work to keep families together. 81% of families referred were able to stay together with the support of the team. While our Fostering Service expanded our Fostering Together support programme, creating networks of support between children and carers and establishing support communities throughout the borough. We also recruited a further 25 foster carers against a target of 20. We are also delighted to see the launch of our Bexley Carers Advisory Partnership, providing joint planning with our foster carers to further develop our service.

Unfortunately, despite our efforts, we saw a significant rise (to 19%) in the proportion of Children in Care placed in residential placements this year. We’re still lower than the average figure for London last year, but higher than anticipated and this impacts children’s outcomes and our budget. In addition, fewer of our care leavers are in education, employment or training this year (down to 67%), so we remain focused on supporting these young people. We’ve published a new protocol to provide clear housing pathways for young people and arranged a variety of taster sessions and experience days with universities and employers to help our young people understand their options for the future. We are committed to see our care experienced young people thrive as they move to adulthood and independence.

Education is vital and we strive to provide all pupils with the support they need to achieve their full potential. A-level grades returned to pre-Covid standards last summer and many of our schools improved their Ofsted ratings so more of our pupils now attend good or better schools. 97% of nurseries in Bexley were rated good or outstanding too and more people accessed the 2-year old childcare offer this year which helps children get a great start to school and parents get back to work. 99% of Bexley children were offered one of their top 3 preferences of Primary School and 96% of children got a place at a secondary school of their choice.

Despite the disappointing outcome of the recent inspection of our services for children and young people who have Special Educational Needs and Disabilities (SEND) across the local area, we were pleased that some areas of our work received positive feedback, including the impact of our multi-agency early intervention team and the academic achievements of our SEND pupils. We continue to improve our support for our young people with Special Educational Needs, through the early intervention work we are delivering as part of our Safety Valve Programme, the expansion of Shenstone Specialist School to an all through School and the new specialist provision at Parkway School both of which increase the number of local specialist school places so that our pupils can be educated within their local community. We are also pleased to report that the new business plan for the Learning & Education College, our Adult Education facility, was finalised. Enrolment at the College increased 14% this year as we continue to prioritise the high quality of education at all stages of life.

The rate of young people in custody improved this year, dropping to 0 and the reoffending rate also dropped – to just 0.15. Crime figures have not been available from the Police in recent weeks. However, we have seen a concerning increase in repeat incidents of domestic abuse.

This year, we launched Bexley’s Joint Local Health and Wellbeing Strategy, setting four key priorities. We also worked with our residents and partners to create a new vision for Adult Social Care called “Your life, your choice – working together towards the life you want”. Taking account of local health needs, we are using our three multi-agency Local Care Networks to deliver localised integrated care to meet our residents’ needs and tackle health inequalities.

Against a backdrop of high levels of demand, we have worked collaboratively across health and social care to relieve pressures on the NHS, helping to prevent admissions to hospital, facilitating safe transfers of care and arranging support to meet people’s care needs. We have successfully delivered our ‘home first’ approach during the year, which has given people the chance to continue their lives at home following a hospital stay, wherever possible. We have been working with a range of partners to support the care needs of our residents, such as OneBexley, a local consortium of charities, which gives people a better experience of the care and support system. Working with the Carer’s Partnership, we have improved our support for informal carers so they can maintain a good quality of life while caring.

The proportion of people who report having control over their daily life has increased in 2023/24 to 77%. There has been a small increase in the proportion of clients completing reablement with a reduction in their level of need, increasing to 84% in 2023/24.

We worked with our partners to ensure the Government funded the Community Diagnostic Centre at Queen Mary's Hospital in Sidcup. This new centre will cut travel and waiting times for our residents and help them get the treatment they need faster.

Our free Bexley Stop Smoking Service helped 224 people to successfully quit smoking, the single most effective thing a person can do to improve their health. School Superzones worked with eight primary schools in Thamesmead and Slade Green to help create healthy environments around the school. 

Priority theme 2: Ambition for our borough

The adoption of the Local Plan in April 2023 positively plans for sustainable development within the borough including measures to address climate change. Also, it means that open spaces and waterways are protected, enhanced, restored and promoted. Furthermore, all future developments must support the delivery of a high quality, well connected and sustainable network of open space.

The Sidcup Storyteller, a new venue with a 3-screen cinema, bar, coffee shop, live performance space and community hub, as well as the home of Sidcup Library, opened on the old Blockbuster Video site. The community space has been shortlisted for a Pineapple award in recognition of its contribution to the renewal of an area and its positive impact on a local community. We saw a 19% increase in the number of physical library visits across the borough this year and a 10% rise in use of our leisure centres for sport and physical activity.

Our determination to protect our environment and to take action against climate change is demonstrated by our new dry recycling haulage and processing contract which commenced on 1st September 2023. This contract save £0.5 million a year, as well as reducing the carbon footprint by processing recycling locally.

We have seen a small increase in the recycling rate and a reduction in residual household waste and food waste. Achievements include increased engagement with schools, the approval of a Reuse and Recycling Plan, a free textile collective service for residents, and our promotion of food waste reduction apps in collaboration with Relondon, Kitche and Olio. We were gratified to win the Public Sector Campaign of the Year in recognition of this great work.

We were also pleased to see that Lesnes Abbey Woods has been officially recognised as one of the country’s best parks with a Green Flag Award. We continue to work hard to preserve and improve the green spaces in the borough. We agreed £0.2 million of capital funding for 446 new litter bins. Our waste collection service has seen significant improvement this year with missed collections reducing by over 50%. We also were pleased to cut fly-tipping in Bexley by almost one-third last year, one of the biggest reductions in London.

We’ve dealt with 100% of major planning applications within timescales for 2 years running and have exceeded statutory requirements. We have seen a number of important planning applications through to decision, including a 1,250 dwelling scheme in Belvedere and several BexleyCo applications, securing much needed housing in borough.  Planning Enforcement have resolved several breaches of planning control, notably obtaining a High Court Injunction which requires 18 months monitoring in apprehending serious breaches of planning control at a problem site within the Metropolitan Green Belt.

We have seen a net reduction of 72 households in emergency accommodation since April 2023 and prevented 669 households from homelessness – a 90% increase on the previous year. We have also worked with partners to expand Bexley’s housing and agreed a Local Lettings Plan to target under-occupiers.

The economic climate has impacted our Employment Service. 545 people were moved into new jobs in 2023/24, which was a reduction on the previous year, and the percentage of people in sustained employment also decreased 55%.

Priority theme 3: An Efficient and Effective Council

We have maintained a strict review of our financial strategies and spending, making sure that we receive the funds due to us, spend taxpayers’ money wisely and maximise our value for money in the services we provide. We’ve continued to focus on efficiency and transformation opportunities and have also established the Economy, Efficiency & Effectiveness (3Es) Board and a Spend Panel to closely monitor our budget spend.

The collection rates for council tax and business rates both improved slightly this year – a welcome recovery following the pandemic and despite ongoing cost of living pressures, the percentage of households in Temporary & Emergency Accommodation in rent arrears has decreased by 7% this year. There's been an increase in the number of Penalty Charge Notices (PCNs) issued by both Civil Enforcement Officers and CCTV, but a slight decrease in the percentage of PCNs paid (to 69%).

We were proud this year of the support we have been able to provide for residents struggling with the increased cost of living. The Household Support Fund has been a crucial element of that and we were pleased to distribute £3 million in this fund. The support was used to provide supermarket vouchers, support for carers, support for housing costs, and domestic abuse services, amongst others. We supported over 1,200 children during the Easter holidays on the Funded Holiday Activities and Food programme and provided over 8,400 free school meal vouchers to children in the borough.

However, despite the work we’ve done to improve efficiency, there’s still great pressure on our budget. The Council, along with all Local Authorities, has faced continued financial pressures: the road to recovery following the pandemic was further impacted by global inflationary pressures, which pushed UK inflation to levels not seen in a generation and impacted contract inflation for our services.

There has also been continued uncertainty surrounding the future of local government funding, making it difficult to forecast and plan for the medium and long term. We’ve experienced additional spending pressures in Children’s and Adults’ Social Care, waste collection, parking and cemeteries and crematorium services. We therefore reported an overspend of £8.644m in 2023/24, so we know we must continue our 3Es work and do more in coming years.

We are lobbying the Government on these matters but meanwhile, we set our budget to respond to these financial challenges, while delivering the quality services our residents need and rely upon.

Despite these challenges, we are proud of our achievements. We continue to reduce our carbon footprint and energy costs as part of wider work and commitments in our Climate Change Action Plan. We campaigned hard against the expansion of ULEZ into Bexley, and although ultimately unsuccessful in our efforts to overturn it, we were pleased that the pressure we put on TfL resulted in a better deal for residents with the expansion of the Scrappage Scheme.

We published a refreshed Equality, Diversity and Inclusion Policy. This is an integral part of our wider vision to make Bexley even better, helping to enable everyone in Bexley to reach their full potential and benefit from everything Bexley has to offer, with a thriving economy and cohesive and strong communities.

We have also launched a new Customer Experience strategy focused on improving and enhancing the relationship between residents and the Council and we are currently developing a People Strategy to help us achieve our organisational objectives.

2023/24: A Financial Overview

The Budget and Council Tax for 2023/24 was set by Full Council in March 2023 in the context of the Council’s Medium Term Financial Strategy covering the period 2023/24 to 2026/27. The budget set out the detailed financial plans for the Council in its Revenue and Capital budgets for the financial year.

The Council has faced continued financial pressures during the year. The road to recovery following the pandemic was further impacted by global inflationary pressures, which pushed UK inflation to levels not seen in a generation. Inflation stood at 10.10% in March 2023, reducing to 3.20% in March 2024. The high rate of inflation was driven by:

• Higher energy prices – Russia’s invasion of Ukraine has led to more large increases in the price of gas. The price of gas doubled and while no longer near the extreme highs seen in late 2022 and early 2023, they are still high and unaffordable for many
• Demand and supply – Increased inflation has led to businesses charging more for their products. This led to higher prices – particularly goods imported from abroad; and
• Employment – There are more job vacancies than there are people to fill them,. This means that employers are having to offer higher wages to attract job applicants.

There have been additional pressures in children’s and adult social care, waste collection services, Parking and cemeteries and crematorium.

In addition to the global economy, uncertainty surrounding the future of local government funding, the impact of the reforms to business rates and long-term sustainable funding for adult social care continue to have an effect on our medium-term financial planning. We are lobbying the Government on these matters and make frequent representations to Ministers as we seek to influence future decision-making.

The Council also faces financial pressures from contract inflation and the challenges posed by the changing needs of our residents and growth in some demand-led key frontline services. The Council set its budget in order to respond to these financial challenges while delivering the quality services our residents need and rely upon. The afore mentioned global economic situation is only adding to these financial pressures.

The focus of the Council in order to deliver a balanced budget has continued to be on efficiency and transformation opportunities in order to ensure we deliver the services local people need and ensure the safety of our vulnerable residents.

In 2023/24 the Council had a General Fund Budget of £207.197m. The Council Tax requirement for the borough was £133.299m. The remaining income coming from government grants and Non-Domestic Rates. Additional funding of £3.887m was included in the budget to support growth. However, funding requirements over and above this have occurred in the 2023/24 year, resulting in the final General Fund outturn of £215.841m, which is an overspend of £8.644m.

Group accounts

The Council is required to produce group accounts if the council has a controlling interest over any other company or entity. This is the third year the council has produced group accounts to include BexleyCo Ltd.

BexleyCo has been established with the intention being that it is used as a vehicle to drive development in the borough while generating a profit in the long-term that is planned to be ploughed back into Bexley to keep the quality of services residents deserve. The Council has ambitious plans, and each project is evaluated and business cases approved where they meet these plans.

BexleyCo’s ten-year target is to:

• deliver 1,200 new homes for sale, affordable and market rent to local people with the ambition to increase to provide more new homes
• support the local economy through jobs, training opportunities and both direct and indirect investment
• stimulate good growth and regeneration through an exemplar approach to the design, marketing, sale and management of our new homes
• generate significant financial returns for our Shareholders thereby helping to alleviate growing budgetary pressures
• facilitate new communities that are socially successful and sustainable over the long term through design, construction, sales, marketing and estate management strategies

Revenue outturn

The Statement of Accounts sets out the Council’s spending and financing in line with accounting and statutory requirements.

The table below provides a summary of the outturn position by Directorate. This leaves a net outturn position for service budgets of a £17.520m overspend. Once corporate budgets and funding have been taken into account, there is a resulting overspend of £8.644m. The overspend has been funded from the Financial Planning reserve.

The financial pressures of 2023/24 were mainly due to high interest rates and inflation, the cost of living crisis, demand and the complexity of needs impacting social care services.

The main overspends within Adult Social Care related to third party spend on care packages, pressures in demand, demography and care complexity.

Children's services reported major variations throughout the year for looked after children, primarily increasing unit costs for residential placements and additional demand for SEN transport. There was a need for additional staffing to respond to the increase in demand, resulting in significant overspends.

The 2023/24 year continued to see changing patterns of expenditure and income within Adult Social Care.  As with 2022/23, there was additional expenditure on community-based and older people care home services with both numbers and unit costs increasing. There were also increases in the unit costs for Residential and Nursing and direct payments.

The Housing Service was successfully able to mitigate the demand pressures on temporary accommodation in 2023/24 through rigorous management of the service and utilising the Private Rented Sector and other suitable alternatives.  However, properties for Private Rented Sector discharge are becoming increasingly difficult, time consuming and expensive to secure as  the cost of dealing with the challenge has increased.  This will be particularly difficult to maintain going forward due to the changing market conditions, the Home Office programme for decanting from London hotels and the Department of Defence accommodating Afghan refugees.

Parking service income continued to be impacted due to changing patterns of behaviour.

Planning and Regulation Services and Building Control income continue to decline as a result of the fall in applications and use of agency staff.

Capital outturn

During the year, the Council’s capital outlay was £18.574m against a revised budget of £25.406m, with an aggregate slippage of £6.832m. A robust review will also take place to ensure that all schemes are required in future years. 
 

The variances from budget relate primarily to the profiling of expenditure as opposed to the cancelling of projects, the most significant of which were the schools SEN schemes, and Erith and Sidcup regeneration projects.

Bexley’s balance sheet

The Council maintained a strong balance sheet, with £972.853m of Long Term Assets as at 31 March 2024, Current Assets of £105.293m, Current Liabilities of £61.093m, and Long Term Liabilities of £252.197m. Furthermore, the Council has usable reserves of £86.385m. 

Reserve levels

As the Section 151 officer, I have also taken account of the reserve levels and I have advised that a prudent level of General Fund reserves is circa £14m. This level is required to ensure there are sufficient resources for both working capital and to cover emergency expenditure.

Borrowing and capital financing

The Council currently has £223.931m of borrowing outstanding as at 31 March 2024.

There has been no external short term borrowing necessary for this financial year.

The Capital Programme for 2023/24 to 2026/27 was agreed by the Council in March 2023. This outlined the capital expenditure planned for 2023/24 and the borrowing requirement of £25.936m, however, only £8.288m was required in the end.

Collection Rates for Council Tax and Business Rates

The net collection of Council Tax for the year to 31 March 2024 was 95.35% of the £172.666m collectable, leaving £8.037m to be recovered.
The net collection for Business Rates at the end of March 2023/period 12 is 97.23% of the £85.416m collectable, leaving £2.366m of debt to be recovered.
Council Tax funds services both the London Borough of Bexley and the Greater London Authority (GLA), the split of the Council Tax income and Debt is 79:21.  Income from Business Rates are shared between the London Borough of Bexley, GLA and the Department of Levelling Up, Homes and Communities in a ratio of 30:37:33.

Non-Current Asset Revaluation

The Council appointed Wilkes Head & Eve to carry out a rolling valuation programme of a proportion of the Council’s assets in 2023/24. The impact of these valuations is reported within the notes to the accounts.

Significant Changes in Accounting Policies

The accounts for 2023/24 are presented in accordance with the Code of Practice on Local Authority Accounting in the United Kingdom (the Code) which specifies the principles and practices of accounting required to give a ‘true and fair’ view of the financial position and transactions of the local authority.

The Code sets out the proper accounting practices required by Section 21(2) of the Local Government Act 2003. These proper practices apply to the Statement of Accounts prepared in accordance with the statutory framework established for England by the Accounts and Audit Regulations 2015.

The 2023/24 Code incorporates required accounting standard amendments, although there were no material impacts on the Council in 2023/24 as a result of the amendments.

Bexley’s Medium-Term Financial Plan

The medium term financial planning process is an essential part of the Council’s strategic planning framework. The Medium Term Financial Strategy integrates strategic and financial planning over a four-year period. It translates the Corporate Plan priorities into a financial framework which enables the Cabinet and officers to ensure policy initiatives can be delivered within available resources and can be aligned to priority outcomes.

In February 2024, the Budget Gap was £39.498m, with the biggest pressure on 2027/28 as shown below.

Economic Climate

The Council continues to face increasing pressures relating to domestic economic factors, such as supply chains and the ongoing war in the Ukraine resulting in higher energy prices, all fuelling inflation.  In March 2023, inflation was 10.10%. This reduced to 3.20% by March 2024 and, as of May 2024, was 2.00%.  Inflation is expected to go back up to around 2.50% towards the end of the year, before falling again.  Similarly, interest rates continued to rise, reaching a high of 5.25% in August 2023, where it has remained, although it is expected to reduce by the year end.

There are also further pressures on the Council, primarily its ability to recruit and retain staff, increasing levels of demand and cost, specifically for Adult and Children Social Care and SEN Transport. But also pressures on other demand led services such as housing, parking and waste services.  The cumulative impact on the cost of living for residents and businesses also impacts on discretionary spend, debt collection rates, safeguarding and homelessness.

Whilst the Council’s un-ringfenced General Fund reserve would have some capacity to absorb some of the financial impact, a robust financial plan is required to ensure the sustainability of the council’s finances is maintained.

Officers will be reviewing the Medium Term Financial Strategy, taking into account the 2023/24 final outturn and the financial impact of the UK and global economic situation. The Council has always used cashflow forecasting to assist with treasury management decisions, however it has gained greater significance as unplanned expenditure has been required to deal with the emerging situation. Cashflow is being closely monitored to ensure sufficient funds are available for daily requirements, to this end the Council is using the resources of City of Westminster Treasury Team who have a wealth of experience managing cash and investments.

Caroline Holland

Interim Director of Finance and Corporate Services, London Borough of Bexley

Date: 31 May 2024