Issue - meetings

To consider a report by the Director of Finance and Corporate Resources on the Final 2024/25 Budget and Medium-Term Financial Strategy (2025/26 to 2028/29) including the capital programme prior to its consideration by the Council.

Executive Councillor: B Mickelburgh.

The Cabinet has recommended to Council the approval of the overall Final Budget 2024/25 and Medium Term Financial Strategy 2025/26 to 2028/29 as outlined in Appendix 1 of the report now submitted which includes the Revenue Budget at Section 2 and the Capital Programme at Section 3.

With the aid of a report prepared by the Director of Finance and Corporate Resources (a copy of which is appended in the Minute Book) the Cabinet reviewed the Council’s Revenue and Capital budget proposals for the 2024/25 Final Budget and the Medium-Term Financial Strategy – MTFS (2025/26 to 2028/29).

The Executive Leader, Councillor S J Conboy advised the meeting that Councillor B Mickelburgh, Executive Councillor for Finance and Resources, was representing the District Council at a Local Government Association (LGA) Special Interest Group meeting about the funding of Internal Drainage Boards in Westminster. As funding of the drainage boards consumed over £500,000 of annual budget of the Council and it was therefore important to press Central Government over changes to the funding mechanism.

By way of background, the Director of Finance and Corporate Resources then reported that the budget included relevant savings, income and growth proposals, the implications of other budget adjustments and the Commercial Investment Strategy, and the government’s financial settlement, together with a planned Council Tax increase of 3.21% (equating to £5) for 2024/25 and then £5 increase per annum for the duration of the MTFS and have included the implementation of the revised Council Tax Support Scheme.  Whilst in regard to the robustness of the 2024/25 budget and MTFS 2025/26 to 2028/29 it was noted that in respect of risks that both HDC and the wider local government community face at this time of continued public sector austerity the key findings are that HDC should (i) in 2024/25 make a contribution to General Reserves of £1.872m, (ii) utilise only the General Fund and Budget Surplus Reserves and therefore based on those assumptions in the current MTFS, HDC would be able to maintain a minimum level of General Fund (Unallocated) Reserves; and (iii) take a total net contribution from General Reserves of £2.212m over the 5 years of the MTFS.

The Cabinet agreed that the financial climate continued to be unusual with inflation and interest rates having risen to levels not seen for decades, and world conflicts causing disruption to energy and food supplies. This has put considerable pressure on HDCfinances with substantial, necessary cost increases being borne by services (e.g., increases in utility bills, housing benefit, insurance and drainage rates). In addition (i) there is the Material Recycling Facility (MRF) waste management contract being retendered by the County Council that is another cost pressure to take into consideration and HDC has allocated £900k additional expenditure per annum for this, which gives a total pressure of £4.5m in the MTFS.  The Local Government Finance Settlement being only for one year will make financial planning and sustainability challenging although delaying NNDR re-baselining will provide a one-off increase to funding, that will be used to create a new £2.5m workforce strategy implementation reserve together with a further £1m reserve for investments to generate future revenue budget benefits. Expenditure against this reserve will be considered by Overview and Scrutiny.

Members attention was then drawn to  ...  view the full minutes text for item 67