Agenda item

The Interim Head of Strategic Finance and Property and Section 151 Officer presented the report and acknowledged all the work that relevant officers had put into the plan. Because of this work and well-debated proposals, it was possible to recommend a well-balanced Medium Term Financial Plan for 2020/21 – 2023/24.

The Interim Head of Strategic Finance and Property and Section 151 Officer referred to certain specific recommendations in the report and noted the following: the Government had lifted the freeze on Council Tax as they wanted local government to be more self-reliant and not depend too much on central grants; the Fair Funding review by the Government had not yet been concluded, and certain assumptions therefore had to be made, which were done with the help of an external consultancy; and the proposed Capital Programme was affordable for EHC.

The Interim Head of Strategic Finance and Property and Section 151 Officer noted that the Council’s revenue budget consisted of five major “building blocks”, which were detailed in the report.

With reference to the New Homes Bonus, the Interim Head of Strategic Finance and Property and Section 151 Officer stated that while the Council had benefitted from this, there was concern about the demise of the bonus. The Government followed a path of gradual reductions and the amount payable was only guaranteed for one more year with no legacy payments and would probably disappear after the Fair Funding review had been concluded. It should also be borne in mind that the bonus would no longer be available to be shared with town and parish councils.

The Interim Head of Strategic Finance and Property and Section 151 Officer specifically thanked the former Head of Strategic Finance and Property (Isabel Brittain) for her work in preparing the budget and engaging the various stakeholders.

Councillor L Corpe referred to the proposed funding cuts to the Citizens’ Advice Services and Community Voluntary Services and said that while this might look like a saving up front, the Council would be “shooting itself in the foot” as this may lead to problems in the future. These organisations could not change their funding streams and while the proposed funding cut seemed very small, it would have a big impact on their services. He requested that the proposed cuts should rather be scrapped or phased-in more gradually; an increase in parking fees could possibly be considered to make up for this. The proposed cuts also did not correspond with the objective in the draft Corporate Plan to support vulnerable residents.

Councillor A Curtis noted that while he agreed that these were valuable services, these organisations have known about the proposed cuts for some time.

Councillor J Burmicz said it was also a false economy to reduce the funding of PCSOs as they provided a vital service in all communities. The Chairman noted that the funding for PCSO’s came from the Police budget and Councillor A Curtis advised that the Hertford Constabulary were not bound by the EHC budget; they could increase their own budget and appoint more PCSOs.

The Chairman referred to the Net Cost of Services and asked if this had been capped for the first time. The former Head of Strategic Finance and Property said that this was the second year that this approach had been followed; it provided more flexibility when the budget was set.

With reference to the high and subsequently falling costs detailed under Operations, the Interim Head of Strategic Finance and Property and Section 151 Officer said that when the Leisure Centres were completed, the service provider would be paying the Council and this amount should reduce.

The Interim Head of Strategic Finance and Property and Section 151 Officer stated that the costs for salary increases would only be finally determined once negotiations with the unions had been completed.

The Chairman referred to the Budget Gap, specifically the numbers for Revised Service and Funding Pressures, and asked how these were determined. The Interim Head of Strategic Finance and Property and Section 151 Officer said that where there were changes to services, the figures would be adjusted.

Councillor A Curtis referred to Income and enquired if income sources were being diversified. He also enquired if there was confidence in the income to be obtained from Financial Sustainability and the Millstream company and if these income targets would be met within the proposed timescales. The Interim Head of Strategic Finance and Property and Section 151 Officer replied that Millstream would generate an additional £100k p.a. An updated business plan would be submitted to Council on how this income would be met. With regard to Financial Sustainability, one building had already been acquired and the Financial Sustainability Committee would be looking at acquiring more income-generating buildings. The Interim Head of Strategic Finance and Property and Section 151 Officer said there were no obstacles to generating income from these two sources, and he was therefore confident that the targets would be met.

The Chairman noted that a £40k saving was being proposed from improved recycling and asked if the price trajectory for recycling was known. The Interim Head of Strategic Finance and Property and Section 151 Officer said the paper recycling contract would again be procured in conjunction with North Herts Council and the new figures should be available by the end of February 2020. The paper recycling rate could reduce as part of the new procurement contract. If there was any uncertainty on the outcome of the procurement contract or if there was a sudden increase in the costs of recycling, this would be off-set through cross-subsidisation. The situation would however be monitored.

The Chairman enquired what the effect would be if the option to charge for green waste was not used. The Interim Head of Strategic Finance and Property and Section 151 Officer said the proposed income of £400k for green waste in 2021/22 was significant. While providing a green waste service was not a statutory obligation, most other authorities charged if they provided such a service.

The Chairman enquired about the type of projects which could be put in place to increase the total reserves. The Interim Head of Strategic Finance and Property and Section 151 Officer replied that there were a number of “Invest to Save Ideas”.

With Members consent it was agreed that the recommendations in the report be taken individually.

Councillor A Curtis moved, and Councillor L Corpe seconded, a motion to support recommendation (a) in the report, as detailed below.  The motion being put to the meeting, and a vote taken, it was declared CARRIED. 

RESOLVED – to endorse that the Executive considers the following for recommendation to Council: that the East Herts share of Council Tax for a band D in 2020/21 be set at £174.09.

Councillor A Curtis moved, and Councillor A Alder seconded, a motion to support recommendation (b) in the report, as detailed below.  The motion being put to the meeting, and a vote taken, it was declared CARRIED.

RESOLVED – to endorse that the Executive considers the following for recommendation to Council:  that the updated position on the Medium Term Financial Plan and Budget for 2020/21 including the budget pressures and risks be approved.

Councillor T Stowe moved, and Councillor A Alder seconded, a motion to support recommendation (c) in the report, as detailed below.  After being put to the meeting a vote was taken, with Councillor Corpe voting against the motion. The motion was therefore declared CARRIED. 

RESOLVED – to endorse that the Executive considers the following for recommendation to Council:  The new savings and income generating proposals for 2020/21 onwards as shown in Appendix ‘A’ be approved.

Councillor A Curtis moved, and Councillor T Stowe seconded, a motion to support recommendation (d) in the report, as detailed below.  The motion being put to the meeting, and a vote taken, it was declared CARRIED.

RESOLVED – to endorse that the Executive considers the following for recommendation to Council:  that the Capital Programme as set out in Appendix ‘C‘ be implemented.

Councillor T Stowe moved, and Councillor A Curtis seconded, a motion to support recommendation (e) in the report, as detailed below.  The motion being put to the meeting, and a vote taken, it was declared CARRIED. 

RESOLVED – to endorse that the Executive considers the following for recommendation to Council:  that the schedule of charges set out in Appendix ‘D’, each with an average increase of 2.5% for 2020/21, be approved.