Agenda item

The Executive Councillor for Resources and Customer Services to present a report by the Head of Financial Services on the process leading towards approval of the 2012/13 Budget/Medium Term Plan at the meeting of the Council in February 2012.

With the assistance of a report by the Head of Financial Services (a copy of which is appended in the Minute Book) and referring to Minute No. 30, Item No. 21 post, the Executive Councillor for Resources and Customer Services updated Members on issues which would impact upon the process leading to approval of the 2012/2013 budget and medium term plan at the Council meeting in February 2012.  The Executive Councillor also invited the views of the Council on the basis on which the Minimum Revenue Provision should be calculated.

Against a background of continued uncertainty, the Council was reminded that there was still a shortfall of savings equivalent to £2m and that for a variety of reasons the 2010/2011 outturn was £1m below that forecast.  Councillor Rogers drew Members’ attention to savings which had been identified already, those areas where potentially savings could be made and others where work to achieve savings was still in progress.

The Council was informed of the Government’s intention to replace the rate support, Council tax reward and the new homes reward grants with a formula grant which also was intended to fund any additional tasks that had been transferred to local authorities over  time.  This, in turn, was to be replaced by an alternative scheme which would permit a local authority to retain a proportion of business rates from April 2013. The Council noted the potential for this latest initiative to be beneficial to the authority and, in the short term, for the new homes bonus to be higher than originally forecast. 

However, given the difficulty in forecasting the impact of the economic downturn of several significant issues and the outcome in terms of net spending or funding, Councillor Rogers presented two options to the Council in terms of the level of council tax which might be recommended later in the budget process. 

Having commended to Council the annuity basis as the means of calculating the Minimum Revenue Provision, Councillor Rogers invited the Council to debate the financial forecast.

Before doing so and on behalf of the Liberal Democrat Group, Councillor P J Downes thanked Councillor Rogers for his contribution as Executive Councillor for Resources & Customer Services and for the manner in which he had presented reports to the Council on financial matters.  Councillor Downes reminded Members that, in his view, the Council’s financial position was largely related to the decisions taken, in the past, to support the sale of council houses and not to raise council tax and that he was hopeful that the Council would take advantage of the opportunity presented to use maximum flexibility in setting future council tax levels to protect reductions in service and minimise the impact upon the most vulnerable in society.  In support of his colleague, Councillor M F Shellens expressed his appreciation to Councillor Rogers for his thoughtfulness and careful presentations to Council and welcomed the various council tax options which had been proposed for consideration.  These sentiments also were endorsed by Councillors I C Bates, S Greenall and P D Reeve.

Councillor S M Van De Kerkhove questioned whether the new homes reward grant could be used to benefit the residents of St. Neots given the extent of housing development in the town.  On the same subject, Councillor Mrs M Banerjee considered that any reward grant received should be directed towards community infrastructure.

In thanking Councillor Rogers and the Head of Financial Services for their work on the budgetary process to-date, the Executive Leader, Councillor Ablewhite acknowledged that the current budget process would be difficult, that there was little point dwelling on the past and that the Council had to respond to current challenges and seek to protect key services considered most important to local residents.

In response to the issues raised, Councillor Rogers thanked Members for their kind words and Officers for their assistance to him during his time as Executive Councillor for Resources & Customer Services.  In terms of the decision to sell the Council’s housing stock, Councillor Rogers asserted that, in his view, the funds received following that decision had been used wisely over the years, that he would continue to support a strategy whereby council tax was increased by a small percentage each year and for the new homes reward grant to be contributed to the overall council budget rather than directed towards a specific area.  Whereupon, it was

RESOLVED

  that the contents of the report be noted and the annuity basis for the calculation of Minimum Revenue Provision as described in Annex E of the report now submitted approved.