The Council is requested to consider the Cabinet's recommendations relating to the Financial Strategy, Medium Term Plan for 2007/11, the 2006/07 Budget, related Prudential Indicators and the Treasury Management Strategy (see also Item Nos. 88 and 89 of the Report of the meeting of the Cabinet). Report by the Head of Financial Services enclosed.
Minutes:
In conjunction with a report by the Head of Financial Services (a copy of which is appended in the Minute Book) and Item Nos. 88 and 89 of the Report of the Cabinet, the Executive Councillor for Finance, Councillor T V Rogers addressed the Council on the Financial Strategy, Medium Term Plan for 2007 – 2011, the 2006/2007 budget and related prudential indicators contained in the Treasury Management strategy.
Members were reminded of the decisions they had taken previously which had resulted in an increase in Council Tax of £12 for a Band D property in 2006/07 and which had led to the Government subsequently capping the Council’s budget. By reference to Appendix A to the Report of the Cabinet, the Council were further advised of the adjustments required to the approved MTP to take account of inflation, interest rates and level of government financial support. Councillor Rogers also welcomed the Government’s new initiative to forecast settlements over a three years period in view of the greater certainty that should arise in financial planning.
Having drawn attention to the significant variations to the MTP following its review, the target set for efficiency savings and the Government’s likely approach to capping, Councillor Rogers outlined two options for future Council Tax increases. Turning specifically to the recommendations of the Cabinet, Councillor Rogers explained the reasons for the option preferred, which also had been supported by the Overview and Scrutiny Panels and the business community. This assumed a Council Tax increase of 5% each year and would necessitate a mixture of efficiency improvements, a review of existing services and developments already included in the MTP which would be subject to review annually in the light of Government guidance. In commending the budget to the Council, Councillor Rogers advised of several late adjustments and these included proposals for improvements to public conveniences in the District and expenditure in connection with the Headquarters and Other Accommodation Project. He also explained the reasons for the submission of a revised prudential code and Treasury Management Strategy.
In response, Councillor P J Downes on behalf of the Liberal Democrat Group moved and it was duly seconded, that -
in the second bullet point in paragraph 7 of the report of the Head of Financial Services the letter “s” be added to the word “approve" in the first line and in the second line, after the word “attached”, the words “but instructs the Executive Councillor for Finance to bring forward to full Council before the end of March, 2006 detailed proposals for the (presently) unspecified reduction in expenditure” be inserted.
In support of his motion, Councillor Downes suggested that the Council should not approve the budget without details of where savings could be made to achieve the shortfall predicted.
In ensuing discussion, the Leader, Councillor I C Bates reminded the Council that this issue had been considered by the Overview and Scrutiny Panel (Planning and Finance) and that a report thereon would be submitted to their next meeting. On behalf of the Budget Group of the Scrutiny Panel, Councillor P G Mitchell commented that he was satisfied that savings would be achieved and that this would be progressed by the Cabinet.
Upon being put to the vote, the amendment was declared to be LOST. Whereupon, it was
RESOLVED
(a) that the financial strategy as set out in paragraph 6.9 of the Report of the Cabinet and in paragraph 3.2 and Annex C of the Report now submitted be approved;
(b) that the proposed budget and Medium Term Plan as described in revised Annexes A, C and D of the report now submitted, be approved;
(c) that a Council Tax increase of £4.98 on a Band D property in 2006/07 be approved;
(d) that the prudential indicators as set out in revised Annex E to the report now submitted be approved;
(e) that the 2005/06 Authorised Borrowing Limit be increased to £32.8m;
(f) that the Treasury Management Strategy as set out in revised Annex F to the report now submitted be approved; and
(g) that the Head of Financial Services be authorised, after consultation with the Chief Executive and the Executive Councillor for Finance on the risk assessment, to undertake long-term borrowing in 2006/07.
Supporting documents: