Agenda item

To receive a presentation by Councillor J A Gray, Executive Councillor for Strategic Resources, on budget principles for the 2019/20 Budget.

  (Presentation: 10 Minutes

   Questions:   10 Minutes).

Councillor J A Gray, Executive Councillor for Strategic Resources, addressed the Council on the budget principles and framework, together with focus on the future challenges faced by the Council. A copy of Councillor Gray’s PowerPoint presentation is appended in the Minute Book.

Councillor Gray drew Members’ attention to the preparations that had been undertaken for the draft budget and reminded all Members of their opportunity to attend the forthcoming Overview and Scrutiny Panel (Performance and Growth) to respond and provide input into the draft budget.

Members were reminded of the challenging budget environment that the Council faced, with a reduction and change in spending power over the past five years. Having noted the continuous line held for Council Tax at around £7.5m, many of the other funding streams had seen a reduction, including the Revenue Support Grant removal and cutting of the New Homes Bonus that had been invested over the past three years in the Council’s Commercial Investment Strategy. A previous strong area of growth had been the retention of the Council’s business rates, but this had also seen a reduction since the previous year’s budget.

Whilst reflecting on the challenging year for Council services, Councillor Gray referred to criticisms of budgets previously holding a surplus and reported that future years’ budgets would be reviewed to bring into line current variances. The reported projected overspend of £600k had been attributed to an increase in costs for waste collection, lower than expected income across One Leisure and an increase in the cost of homeless accommodation, however had been offset by in year savings of additional income in Development and lower costs from elections, special responsibility allowances and lower capital financing costs.

Members noted the 2019/20 budget and funding proposals of financial self-sufficiency and Councillor Gray highlighted some of the principles to support this, including an increase in Council Tax and a reduction in the provisional settlement of the Council’s grant for next year by £600k making it the fourth highest negatively impacted Council in England.

Councillor Gray reported that the draft 2019/20 budget and Medium Term Financial Strategy (MTFS) had planned to take into account the fair funding review, a new system of allocating funding to Councils that would likely see a reduction of funding away from the District, potentially resulting in budget cuts of over £3m per annum by the end of the MTFS. Having reported this, Members noted that the District could benefit by opportunities for strategic growth, including redevelopment of key sites across the Council area, with an aim of closing the current MTFS gap of £1.6m.

Councillor T D Sanderson reported that the Independent group would be submitting an alternative budget proposal to the meeting of the Overview and Scrutiny Panel (Performance and Growth) in January 2019 and questioned whether the draft budget was realistic, whereby Councillor Gray reported that the targets being set were at an achievable yet realistic level, rather than a target to meet desired outcomes at the end of the MTFS.

In commending Councillor Gray on the clarity of the presentation, Councillor Mrs S J Conboy questioned whether the draft budget represented a viable proposition and not at risk of being signed off by the Section 151 Officer. In response, Councillor Gray explained that the draft budget was not at risk and represented a sound proposal for the Council.

In response to a question from Councillor Dr N Johnson on whether the proposal to increase Council Tax had been contained in the Conservative’s Manifesto, Councillor Gray explained that taxes had to increase in line with the cost of delivery of services but would not increase higher than the state pension increase and was lower than the average increase of earnings of 3%.

In conjunction with Councillor Gray’s comments earlier, Councillor D B Dew reminded Members that the draft budget would be considered at the Overview and Scrutiny Panel (Performance and Growth) meetings in January and February 2019 and encouraged Members to participate in the robust challenge of the budget proposals.