Budget Submission 2022/23 – 2024/25

As part of the production of the GLA Group budget MOPAC is required to submit a draft budget proposal to the Mayor covering the years 2022/23 to 2024/25. This is attached at Appendix 1.

The Mayor’s top priority continues to be keeping Londoners safe and the draft budget has been produced to support this aim.

Uncertainty around Government funding continues to be a significant issue. On 27 October, the Chancellor published the 2021 Spending Review. The impact of this on MOPAC/ the Metropolitan Police Service (MPS) is still being worked through by local and central government; the full impact, together with the outcomes of the Police Settlement, will be included within the final budgets to be presented in February 2021.

This submission incorporates the proposed budgets of the MPS and the Violence Reduction Unit. These demonstrate that the Mayor will continue his commitment to prioritising policing and crime, tackling serious youth violence, violence against women and girls and victims’ services.

This draft Budget Submission has been prepared in accordance with the Mayor’s Budget Guidance issued in July 2021 and with a requirement to publish and submit draft proposals by 26 November 2021.

The DMPC is requested to approve the attached MOPAC 2022/23 to 2024/25 Draft Budget Submission to the Mayor, and the draft Capital Strategy for publication.

The Deputy Mayor for Policing and Crime is recommended to:

• Approve the 2022/23 to 2024/25 Draft Budget Submission (Appendix 1)

• Draft MOPAC Capital Strategy 2022/23 – 2040/41 (Appendix 2)

1. Introduction and background

1.1. This MOPAC budget submission forms part of the annual process to develop the overall GLA Group budget. The DMPC has been delegated the authority from the Mayor to make the annual budget submission to the Mayor of London in line with the agreed budget timetable.

1.2. In line with the Mayor’s Budget Guidance published on 30 July 2021 MOPAC is required to submit draft budget proposals by 26 November 2021 to allow formal consultation to be undertaken on the proposals.

1.3. MOPAC will also publish a full draft budget on its website together with a revised Capital Strategy.

1.4. This decision seeks approval to both the draft Budget and Capital Strategy as appended to this document.

2. Issues for consideration

2.1. This draft Budget Submission has been prepared in accordance with the Mayor’s Budget Guidance issued in July 2021 and with a requirement to publish and submit draft proposals by 26 November 2021.

2.2. In line with the Mayor’s Budget Guidance the Revenue budget covers the period 2022/23 to 2024/25, and the Capital Strategy covers the period 2022/23 – 2040/41.

2.3. The draft budget has been based on recruiting the target number of officers from the national police officer uplift programme set out by the Commissioner and supported by the Mayor i.e. 6,000 over the 3-year period to 2022/23. The proposals therefore assume 3,287 additional officers for 2022/23. The provisional grant settlement, which will fund the cost of any additional year 3 officers, will be announced in December 2021, therefore to be prudent, no increase in government funding is assumed at this stage. This has led to a significant funding gap of £249m in 2022/23, £62.2m being a structural budget gap and the balance of £187m being the additional funding required for the officer uplift numbers. Once the MPS allocation from the additional 6,000 officers for 2022/23 has been clarified, the numbers will be revised in the final budget.

2.4. The revenue proposals include the drawdown of Earmarked Reserves in excess of £400m over the period 2021/22 – 2024/25 leaving a closing balance of £145m at March 2025. This includes an annual drawdown of c£30m from the Business Rates reserve across the next four years for the 1,000 police officers which the Mayor provided upfront funding for in 2019/20 to ensure that police officer numbers can be maintained over the medium-term.

2.5. The budget proposals also include the draft 5-year capital programme which, including the forecast for 2021/22, proposes capital investment expenditure of £1.602m. Given that central Government Capital Grant is negligible at £3.3m per annum, this means the proposed programme will require £937.7m of additional funding over the 5-year period. It is currently proposed to meet this through a combination of earmarked reserves and additional borrowing.

3. Financial Comments

3.1. This is a financial report and the details are set out in the body of the report.

3.2. The MOPAC Chief Finance Officer has provided assurance as to the robustness of the estimates proposed and the adequacy of the proposed financial reserves. The proposals made in the attached submission will result in a General Reserve balance of £46.6m. This represents 1.2% of the Net Revenue Expenditure for MOPAC/MPS. During, and by the end of the MTFP period, the General Reserve balance remains below the upper prudent threshold of 5% for retention as per the current Reserves Strategy.

3.3. The MOPAC Chief Finance Officer’s judgement is that the use of earmarked reserves is reasonable and appropriately planned to support MOPAC and the MPS in delivering a very significant transformation programme over this period and providing stability in the officer workforce during this time.

3.4. A suite of annexes in the draft Budget Submission provide further details on budget pressures, savings and prudential indicators.

4. Legal Comments

4.1. MOPAC is subject to the budget setting requirements of the Greater London Authority Act 1999, as amended. As set out above the proposed budget submission reflects the Mayor’s guidance.

4.2. Further to the creation of the MOPAC, pursuant to section 6 of the Police Reform and Social Responsibility Act 2011 (“the act”), MOPAC must issue a police and crime plan within the financial year in which each ordinary election is held, which is underway and on schedule for completion before the end of March.

4.3. Under section 3 (6) of the Act, MOPAC is under a duty to secure the maintenance of an efficient and effective police force. Under paragraph 7 of schedule 3 of the 2011 Act MOPAC may do anything which is calculated to facilitate, or is conductive or incidental to, the exercise of its functions. Under section 79 of the Act, MOPA must have regard to the Policing Protocol when exercising its functions. The Policing Protocol provides that PCCs (including MOPAC) as recipient of all funding, must determine how this money is spent. In London, this is also to be read within the context of the GLA Act 1999, and the Mayor’s budget setting requirements.

4.4. MOPAC/MPS as statutory bodies must only budget for activities that fall within its statutory powers. Further, the Commissioner must ensure that good value for money is obtained in exercising functions, which includes securing that persons under his direction or control obtain good value for money in exercising their functions. Any future proposals for a reduction in staff/officer posts must comply fully with employment law and People Services and the Directorate of Legal Services at the MPS, as appropriate, will need to be engaged to ensure compliance with any statutory or regulatory requirements in relation to any redundancy or redeployment matters.

5. Commercial Issues

5.1. There are no direct commercial issues arising from this report. Where commercial issues are applicable in the operation of services, developing new initiatives and generating savings to deliver this budget, these will be considered as part of the MOPAC/MPS governance process.

6. GDPR and Data Privacy

6.1. There are no direct GDPR/data privacy issues arising from this report as it does not use personally identifiable data of members of the public. In the delivery of the Police and Crime Plan and this budget where GDPR or data privacy issues are applicable these are considered as part of the MOPAC/MPS governance process.

7. Equality Comments

7.1. It is essential that decision makers ensure that consideration is given to legal obligations, in particular the need to exercise the equality duty under the Equality Act 2010, to have due regard to the impacts based on sufficient evidence appropriately analysed. The public sector equality duty is that a public authority must, in the exercise of its functions, have due regard to the need to: (1) eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under the Equality Act 2010; (2) advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it; and (3) foster good relations between persons who share a relevant protected characteristic and persons who do not share it. What the duty requires is consideration of all available information, including the potential impacts and mitigations to ensure a fully informed decision is made. Any decision made in the exercise of any function is potentially open to challenge if the duty has been disregarded.

7.2. Equality Impact Assessments (EIAs) have not yet been undertaken for each of the change proposals that are contained within this budget, but such assessments will be provided within each discrete decision. Those assessments will then be published as part of the decision-making process.

8. Background/supporting papers

8.1. Annex 1 and 2