Agenda item

RESOLVED – That the following recommendations be referred to Council:

(1)          That in the view of the Chief Financial Officer, that the estimates included in the Medium Term Financial Plan 2021/2 to 2024/25 are robust and that the level of financial reserves whilst at minimum levels are adequate, be accepted.

(2)          That officers report back to Executive and to the Budget Scrutiny Committee on a quarterly basis regarding the overall position in respect of the Council’s budgets.  These reports to include updates on achieving savings and efficiencies for 2021/22 and future years.

GENERAL FUND

(3)          A Council Tax increase of £4.99 is levied in respect of a notional Band D property (2.75%).

(4)          The Medium Term Financial Plan in respect of the General Fund as set out in Appendix 1 of this report be approved as the Revised Budget 2020/21, as the Original Budget in respect of 2021/22, and the financial projection in respect of 2022/23 to 2024/25.

(5)          That any further under spend in respect of 2020/21 is transferred to the Council’s General Fund Reserves.

(6)          On the basis that income from Planning Fees may exceed £0.500m in 2020/21, the Head of Paid Service in consultation with the Leader be granted delegated powers to authorise such additional resources as are necessary to effectively manage the resultant increase in workload.

HOUSING REVENUE ACCOUNT

(7)          That Council sets its rent levels in line with government policy, increasing rent levels by CPI (.5%) plus 1% to apply from 1 April 2021.

(8)          That the increases in respect of other charges as outlined in Appendix 3 Table 1 be implemented with effect from 1 April 2021.

(9)          The Medium Term Financial Plan in respect of the Housing Revenue Account as set out in Appendix 3 of this report be approved as the Revised Budget in respect of 2020/21, and the financial projection in respect of 2022/23 to 2024/25.

(10)       That under spends in respect of 2020/21 to 2024/25 are transferred to the HRA Revenue Reserve.

CAPITAL PROGRAMME

(11)       That the Capital Programme as set out in Appendix 4 be approved as the Revised Budget in respect of 2020/21, and as the Approved Programme for 2021/22 to 2024/25.

(12)       That the Head of Property Services and Housing Repairs be granted delegated powers in consultation with the Portfolio Member and the Asset Management Group to approve the utilisation of the £260,000 of AMP Refurbishment Work allocation, with such approvals to be reported back to Executive through the Quarterly Budget Monitoring Report.

Executive considered the report of the Portfolio Holder – Finance and Community Safety which recommended the proposed budget for 2021/22 for the General Fund, Housing Revenue Account and Capital Programme as part of the Council’s Medium Term Financial Plan covering the years 2021/22 to 2024/25.  The report also provided elected Members with an overview of the Council’s financial position in order to inform the decision making process.

The Head of Finance and Resources & Section 151 Officer gave a presentation which outlined key areas of the report and the Council’s financial position.

The Medium Term Financial Plan covered three areas:-

·         General Fund;

·         Housing Revenue Account (HRA);

·         Capital Programme.

Executive’s recommendations were to be reported to Council at its meeting on 3rd February 2021.

The Council’s Section 151 Officer was satisfied that the estimates were considered to be robust, employee costs were based on the approved establishment, investment income was based on the advice of the Council’s Treasury Management Advisors and income targets were considered to be achievable.  Likewise the Section 151 Officer was satisfied that the proposed level of reserves was adequate to fund planned expenditure and potential issues and risks that the Council may face.

General Fund

The Council’s original budget for 2020/21 showed a deficit of £0.290m.  Executive considered a Revised Budget in November 2020 and no changes were made to the budget position since that time.  The final in-year position was dependent on the actual financial performance out-turning in line with the revised budgets as there may be further costs and/or savings identified as the year progressed.  It was agreed that any surplus on the Council’s two main revenue accounts be transferred to reserves in preparations for future expenditure.

The proposed budget for 2021/22 showed a deficit of £0.291m.

The report set out details of the anticipated level of Government funding and other areas of income, as well as details of the expenditure changes forecast over the Medium Term Financial Plan period.  An increase in Council Tax of 2.75% was proposed.

The assumptions made in the budget setting process were also outlined in the report that related to: the effect of Covid-19 pandemic; increase in staffing budgets for pay awards; a reduction in investment income; anticipated price changes for inflation specific budgets; income from planning fees; fees and charges; and the departure of the UK from the European Union.

The Council’s main uncommitted Financial Reserves were the General Fund Working Balance of £2.261m and the uncommitted element of the Transformation Reserve of £1.457m.  Due to the uncertainty surrounding local authority income and the fact that the Council had reduced budgets to a minimal level, it was considered important that the Council continue to review whether the Council had an acceptable General Fund Working Balance.

Housing Revenue Account

A surplus of £0.095m was estimated on the 2020/21 budget, which was £0.011m lower than the current budget.  It was proposed to transfer the surplus into the HRA Revenue Reserve for the next three financial years.

For the 2020/21 budget, the rent levels had been set in line with the Government’s regulations with an increase of 2.7%, effective from 1^st April 2020.

For 2021/22, an annual increase of Consumer Price Index rate 0.5% plus 1% was proposed, in line with the Ministry of Housing, Communities and Local Government’s Policy Statement.  This would mean an average increase on rents of £1.47 per week, which equated to £107.71 per year.

Capital Programme

Details of the proposed Capital Programme in respect of the General Fund and the HRA over the period of the Medium Term Financial Plan were set out in the report.

It was noted that there were to be three separate reports to Council on 3^rd February 2020 concerning the Council’s Treasure Management Strategy, Investment Strategy and Capital Strategy.  The Capital Strategy report would consider capital financing such as borrowing which would enable the proposed capital programme budgets to proceed.

Executive were satisfied with the Council’s current position and noted the good financial management that was currently in place.

Moved by Councillor Clive Moesby and seconded by Councillor Duncan McGregor

RESOLVED – That the following recommendations be referred to Council:

(1)          That in the view of the Chief Financial Officer, that the estimates included in the Medium Term Financial Plan 2021/2 to 2024/25 are robust and that the level of financial reserves whilst at minimum levels are adequate, be accepted.

(2)          That officers report back to Executive and to the Budget Scrutiny Committee on a quarterly basis regarding the overall position in respect of the Council’s budgets.  These reports to include updates on achieving savings and efficiencies for 2021/22 and future years.

GENERAL FUND

(3)          A Council Tax increase of £4.99 is levied in respect of a notional Band D property (2.75%).

(4)          The Medium Term Financial Plan in respect of the General Fund as set out in Appendix 1 of this report be approved as the Revised Budget 2020/21, as the Original Budget in respect of 2021/22, and the financial projection in respect of 2022/23 to 2024/25.

(5)          That any further under spend in respect of 2020/21 is transferred to the Council’s General Fund Reserves.

(6)          On the basis that income from Planning Fees may exceed £0.500m in 2020/21, the Head of Paid Service in consultation with the Leader be granted delegated powers to authorise such additional resources as are necessary to effectively manage the resultant increase in workload.

HOUSING REVENUE ACCOUNT

(7)          That Council sets its rent levels in line with government policy, increasing rent levels by CPI (.5%) plus 1% to apply from 1 April 2021.

(8)          That the increases in respect of other charges as outlined in Appendix 3 Table 1 be implemented with effect from 1 April 2021.

(9)          The Medium Term Financial Plan in respect of the Housing Revenue Account as set out in Appendix 3 of this report be approved as the Revised Budget in respect of 2020/21, and the financial projection in respect of 2022/23 to 2024/25.

(10)       That under spends in respect of 2020/21 to 2024/25 are transferred to the HRA Revenue Reserve.

CAPITAL PROGRAMME

(11)       That the Capital Programme as set out in Appendix 4 be approved as the Revised Budget in respect of 2020/21, and as the Approved Programme for 2021/22 to 2024/25.

(12)       That the Head of Property Services and Housing Repairs be granted delegated powers in consultation with the Portfolio Member and the Asset Management Group to approve the utilisation of the £260,000 of AMP Refurbishment Work allocation, with such approvals to be reported back to Executive through the Quarterly Budget Monitoring Report.

REASON FOR DECISION:

To make recommendations on setting the budget in respect of the General Fund, the Housing Revenue Account and the Capital Programme.

OTHER OPTIONS CONSIDERED:

Alternative options were considered throughout the process of the preparation of the budget and were outlined in the report.

(Head of Finance and Resources & Section 151 Officer)