Agenda item

The Executive Councillor for Finance & Customer Services to present a report by the Director of Commerce and Technology on the financial options available prior to the 2011/12 Budget/Medium Term Plan process.

With the assistance of a report by the Director of Commerce & Technology (a copy of which is appended in the Minute Book) and referring to Minute No. 39, Item No. 20 post, the Executive Councillor for Finance & Customer Services addressed Members on the options available to the Council prior to commencement of the 2011/12 budget and medium term process.  Mindful also of the outcome of the Government’s comprehensive spending review to be announced on 20th October 2010, Councillor Rogers referred to a series of issues in detail.

Members were reminded that at 31st March 2010, the District Council had £15.9 million in revenue reserves and that £1.9 million had been set aside as a further contingency to meet any costs arising from steps which would be taken to achieve savings.  Capital expenditure also was £6.2 million lower than budgeted.  Councillor Rogers also explained and commended the continuation of the Council’s approach to calculation of the Minimum Revenue Provision (MRP).  Given the uncertainty over the Revenue Support Grant, Councillor Rogers advised that the Council had anticipated a 25% reduction in grant over the next five years which could, with formula changes, result in the loss of grant amounting £2.8 million by 2014/15.

Having regard to the forecast gap in funding, the Executive Councillor described the options available to the Council to increase fees and charges, reduce services or facilities or delete services altogether.  More positively, he added that there were opportunities to attract additional grants.  Councillor Rogers concluded by referring to the programme for the budget process, which included the implementation of schemes for voluntary and compulsory redundancy, and by pointing out that there might be an opportunity for the Council in 2011/12 to consider raising council tax without the risk of capping or other Government restraints.

Responding to Councillor Rogers’ address, Councillor G S E Thorpe indicated his concern that the Council was to embark on a scheme of voluntary redundancy without having a clear plan of the services which the Council wished to retain.  Whilst noting the Member’s view, Councillor Rogers informed the Council that the enhanced voluntary redundancy scheme would be offered to senior management in the first instance and that thereafter regard would be given to the outcome of the recent public consultation and views expressed by the business sector when reviewing service provision.

Councillor P D Reeve was of the opinion that the shortfall in Government funding to the District Council could be offset by the Government’s contribution to the European Union when it should be used to protect jobs and services locally.

Councillor M F Shellens urged the Council not to under-estimate how difficult it would be to achieve £2 million of reduction in net costs in 2011/12 and was of the opinion that urgent consideration should be given by Members to the strategic direction of the Council in terms of the services it could continue to provide in the future.

Whereupon, upon being put to the vote, it was

RESOLVED

  that the report and challenges to be addressed over the next five months be noted.