Issue - meetings

a)    Agree that the proposed budget should make use of the flexibility from Government to increase Council Tax by 2.99%, which will increase Council Tax revenue by £366k a year and will result in a Band D Council Tax increase of £5.65 to £195.52 per year;

b)   Request Audit & Governance Committee to consider the savings proposals and advise Executive of any significant issues they believe may arise;

c)    Agree to present proposed savings requirements, that will need to be delivered to balance the budget in the medium term, the delivery profile of which without any smoothing is as follows:

2024/25£1.179 million

2025/26£5.003 million

2026/27£0

2027/28£0.534 million;

d)   Agree to propose the use of the General Reserve and the Interest Equalisation Reserve in order to smooth the delivery of the substantial proposed savings targets over the Medium Term Financial Plan;

e)    Agree to propose an amended Capital Programme so as to reduce revenue costs of Minimum Revenue Provision and interest by £1,514k per annum on current interest rates, a total saving of £7.442 million of over the MTFP period.  Expenditure will be prioritised for:

                          i.          essential property maintenance to meet statutory requirements or to prevent loss or damage to neighbouring properties;

                        ii.          investment in ICT to continue but that the budget carry forward that has not been used for two years is deleted;

                      iii.          invest to save initiatives where the business case indicates that the cost of the investment will be recovered in under 10 years;

                      iv.          to allow pausing of construction of the Arts Centre at Old River Lane until such time as debt levels have fallen sufficiently to make the revenue impacts of new borrowing affordable while at the same time undertaking landscaping works on the arts centre site so that it is an attractive site rather than an undeveloped area blighting the retail and commercial units in the City Heart scheme;

                        v.          provide up to £170k for essential maintenance works for the URC Church Hall in Bishop’s Stortford;

                      vi.          completion of Hertford Theatre, at as low a cost as possible, so that the entire venue is opened and run on a strictly commercial basis to maximise income; and

                    vii.          investment in depot works and waste containers for the new waste and recycling contract.

f)      Delegate to the Head of Strategic Finance & Property, in consultation with the Executive Member for Financial Sustainability, the authority to amend the proposed budget and Medium-Term Financial Plan to be put to the Audit & Governance Committee on 30 January 2024 in order to reflect the Local Government Finance Settlement and other emerging information, so that the committee can consider the must complete and up to date information.

The Executive Member for Financial Sustainability presented the Budget 2024/25 and the Medium Term Financial Plan 2024-2034. He said that this was the first budget of the new joint administration and that the paper set out the current financial position of the council. He said that this was not the final budget but an important step to help shape the final version.

The Executive Member for Financial Sustainability said that the Medium Term Financial Plan in March 2023 stated that significant changes needed to be made over the next four years and the council was not in a good position to absorb external shocks as recent years had seen high inflation, government support reducing and any Council Tax increases capped at 2.99%. He explained that one of the biggest issues was the council’s level of debt as the last five years had seen significant capital spending by the previous administration, with the four big projects in the district costing over £90 million, which was more than the council could finance without substantial borrowing.

The Executive Member for Financial Sustainability said the proposed capital programme was provided at Appendix B which sought to change spending at the Old River Lane site, which would be paused until borrowing was down to sustainable level. He warned that was not likely to happen in the next four years unless government policy changed significantly, and that . another proposal was the selling of non-essential assets.

The Executive Member for Financial Sustainability said that further savings needed to be achieved in the budget for 2024/25 and the Leadership Team were working on implementing savings proposals and a further £996,000 of savings had been incorporated. He said that the latest estimate of additional savings needed was just £183,000 and he was confident that this would be identified. He said that 2025/26 was going to be a challenging year with £3.37 million of savings needing to be made which represented 15% of the council’s current expenditure.

The Executive Member for Financial Sustainability concluded by saying that the council’s single largest source of revenue was Council Tax which was restricted to 2.99% increase without a referendum. He said that this restriction impacted the revenue budget and a Council Tax increase of 2.99% was absolutely necessary and likely to be normal for all district councils in England.

Councillor Brittain proposed that the recommendations in the report be supported. Councillor Glover-Ward seconded the proposal.

Councillor Wilson thanked the Executive Member and the Head of Strategic Finance and Property for their hard work on preparing the budget. He said that he spoke for all of the Executive in saying that they would welcome any saving suggestions from any Members. He said he agreed that it was very unfortunate that the council had the level of debt it did and said that his group had pointed out over the last four years that undertaking four capital projects at once would affect the council’s finances.

Councillor Goldspink said she agreed with Councillor Wilson and  ...  view the full minutes text for item 271