Agenda item

To receive and recommend to Council the Final Revenue Budget 2017/18 and Medium Term Financial Strategy 2018/19 – 2021/22.

RECOMMENDS

That Council approve the:

  i.  overall budget 2017/18 and Medium Term Financial Strategy 2018/19 to 2021/22 at detailed in Appendix 1 (which includes Revenue at Section 2 and the Capital Programme at Section 3 and Appendix 2, growth) of the submitted report, subject to the following amendment:

A Council Tax increase of 2% for 2017/18 and 1.5% through the Medium Term Financial Strategy

  ii.  fees and charges for 2017/18 as detailed in Appendix 1, Section 7 and Annex A of the submitted report; and

  iii.  the new Plan-on-a-Page as detailed in Appendix 3 of the submitted report, subject to the amendment listed in (i) above.

By way of a report from the Head of Resources (a copy of which is appended in the Minute Book), presented in conjunction with the Executive Councillor for Strategic Resources, the Cabinet considered the final Budget for 2017/18 and the Medium Term Financial Strategy (MTFS) for the period 2018/19 to 2021/22.

At the meeting of the Cabinet in January 2017 the Cabinet approved a Budget requirement of £16.7m for 2017/18, a MTFS that increased to £16.9m by 2021/22 and a Capital Programme of £9.5m for 2017/18 that reduced to £3.0m by 2021/22 (Minute No. 75 referred).  This included:

•  savings from a detailed line by line Budget review of £700K;

•  growth of £1.5m (inflation - £227k; employee pay - £453k and other growth - £775k);

•  non-realisation of previously approved Zero Based Budgeting (ZBB) savings of £430k;

•  increased income from the Commercial Investment Strategy of £1.0m;

•  grant settlement relating to New Homes Bonus and funding estimates for Revenue Support Grant, New Homes Bonus and Business Rates; and

•  the new Four Year Settlement from Government.

It was explained that there had since been significant changes to the Budget which were summarised in the submitted report and were detailed in Appendix 2.  It was noted that one of the main changes being the Council wide Apprentice scheme of twelve apprentices at a cost of £221k.  In response to a question it was explained that with a full complement of apprentices the cost would increase to £331k in 2019/20 and thereafter pay inflation had been added.

The Cabinet expressed concern at the amount of changes required to the Budget since the draft Budget had been approved the previous month which resulted in an additional £835k being required.  Concern was also expressed at the Apprentice scheme which Members had not been informed of and therefore a future report to the Cabinet was requested. 

In response to a question it was explained that the Apprenticeship Scheme was allocated to the Economic Development Budget as part of the Council’s growth and skills agenda.

Tabled at the meeting was a document titled ‘Budget Consultation – Headline Results: Business and Voluntary Sector’.  It was explained that by law the Council was required to consult its business community once the draft Budget was approved.  From the 1590 businesses and voluntary sector organisations invited to complete the survey only 22 responses had been received - an increase of seven responses compared to the previous year.

Although there was a slight increase in the number of responses to the survey the Cabinet were disappointed with the response rate.  However, it was accepted that the Economic Development Team had worked hard to develop a database which the survey was directly emailed to and Members were uncertain how the business community could further be encouraged to participate. 

Having been referred to paragraph 8 of the submitted report, the Council’s Responsible Financial Officer (Section 151 Officer) was required to make a statutory statement in respect of the Budget and Reserves.  The Cabinet was informed that Section 8 of Appendix 1 provided further detail and it was considered that the Budget proposed for 2017/18 should not give Members any significant concern regarding the Council’s financial position.

With regard to the MTFS (2018/19 to 2021/22) which included the anticipated removal of Revenue Support Grant as core funding by 2019/20 and changes to New Homes Bonus, there were inevitable risks. However, over the past few years the Council had taken proactive action to address its budgetary concerns and with the planned continuation of its Transformation programme and further commercialisation the Council had a sound financial base.

Also tabled at the meeting was a supplementary report that provided further options for Council Tax increases for 2017/18 and the duration of the MTFS.  The draft Budget approved in January included a Council Tax increase of 2% for 2017/18 and for the duration of the MTFS. The following options for Council Tax increases considered were:

  i.  1.5% for 2017/18 and 1.5% through the MTFS;

  ii.  1.98% for 2017/18 and 1.98% through the MTFS; or

  iii.  2% for 2017/18 and 1.5% through the MTFS.

One view amongst the Cabinet was to support the proposal included in the draft Budget for a Council Tax increase of 2% for 2017/18 and for the duration of the MTFS, on the basis that there was a minimal financial difference per property between an increase of 1.5% and 2% and the majority of properties in the District were in Council Tax Bands A-C.  The Council remained one of the lowest charging authorities and had frozen Council Tax for the past four years.  It was noted that the majority of survey responses from the business community had indicated support for an increase in Council Tax. 

To assure the residents of the District that the Council would continue to identify future savings, it was suggested that the Council should increase Council Tax by 2% for 2017/18 and 1.5% through the MTFS.

Overall there was a consensus amongst the Cabinet for a Council Tax increase of 2% for 2017/18 and 1.5% through the MTFS as it was suggested that this was a reasonable proposal and good compromise having frozen Council Tax increase over the past four years.  It was noted that if necessary an increase in Council Tax could be considered during the Budget preparations during the next financial year.

The comments of the Overview and Scrutiny Panel (Performance and Customers) had been circulated to the Cabinet separate to the agenda, the Panel meeting having occurred following the agenda publication.  Having considered the comments of the Panel, which were welcomed by the Cabinet, it was suggested that the Panel consider ways that it could ensure the additional cost for the transformation work provided good value for money; that the predicted £5.2m of rental income during 2017/18 was compelled by the identification of suitable properties; and that the 1% pay increase for staff was incorporated within the Budget.

In considering the recommendations contained within the submitted report, subject to the amendments required following the proposal to increase Council Tax by 2% for 2017/18 and 1.5% through the MTFS, the Cabinet

RESOLVED

That Council be recommended to approve the:

 i.  overall budget 2017/18 and Medium Term Financial Strategy 2018/19 to 2021/22 at detailed in Appendix 1 (which includes Revenue at Section 2 and the Capital Programme at Section 3 and Appendix 2, growth) of the submitted report, subject to the following amendment:

A Council Tax increase of 2% for 2017/18 and 1.5% through the Medium Term Financial Strategy

ii.  fees and charges for 2017/18 as detailed in Appendix 1, Section 7 and Annex A of the submitted report; and

iii.  new Plan-on-a-Page as detailed in Appendix 3 of the submitted report, subject to the amendment listed in (i) above.