Agenda item

Report to follow.

(A)   Agree that the proposed budget should make use of the

flexibility from Government to increase Council Tax by 3%, which will increase Council Tax revenue by £33,813 a year and will result in a Band D Council Tax increase of £5.53 which is 53 pence a year more than the planned £5 increase included in the Medium Term Financial Plan;

(B)   Agree that Leadership Team proceed with the savings plan for

2023/24 for changes under delegated authority and that do not directly impact residents or all of local businesses;

(C)   Request Audit & Governance Committee to consider the savings items reserved for Member decision and to advise Executive of any significant adverse impact on the district of recommending to Council these savings are implemented;

(D)   Agree that in order to smooth the delivery of the substantial

savings targets over the Medium Term Financial Plan that the

General Reserve and the Interest Equalisation Reserve are used as reported;

(E)   Agree that a temporary use of £400k of the New Homes Priority Spend Reserve, repayable in 2027/28 and 2028/29, may be used to assist with smoothing the delivery of savings as reported;

(F)    Agree the pausing of non-essential capital schemes to prioritise completion of the major projects; provide essential capital financing for the purchase of food waste caddies and changes to Buntingford Depot as part of the new contract fuel and energy strategy;

(G)   Note that the pausing of the £9.6 million of capital spend will

reduce revenue costs of Minimum Revenue Provision and

interest by £719k per annum on rebased capital financing

charges using current interest rates;

(H)   Note that the savings requirements, that will need to be

delivered to balance the budget in the Medium Term, the

delivery profile of which has been smoothed using earmarked

reserves, are:

2023/24 £822k

2024/25 £2,170k

2025/26 £2,192k

2026/27 £2,053k

2027/28 £567k.

(I)    Delegate to the Head of Strategic Finance & Property, in

consultation with the Deputy Leader and Executive Member for Financial Sustainability, the ability to amend the budget and Medium-Term Financial Plan to reflect the Local Government Finance Settlement and other emerging information, so that Audit & Governance Committee can consider the must complete and up to date information when they scrutinise the budget at their meeting on 24 January 2023; and

(J)     Note that the level of budget reductions required to balance the budget in the medium term is beyond further efficiency

measures alone and instructs Leadership Team to commence

preparations for the Reconciling Policy, Performance and

Resources exercise that the new Council, elected in May 2023, will need to undertake alongside the new Corporate Plan, to balance the budget over the medium term.

The Executive Member for Financial Sustainability presented the Budget and Medium Term Financial Plan. He said that the Executive were previously asked to endorse recommendations and assumptions to provide a base for Officers to work on the budget. He said that the revised report took into account the revised position on the council’s forecasts and implications of the Autumn Statement.

Councillor Williamson said that the Executive had agreed to increase Council Tax to the highest threshold without triggering a referendum which was the highest of £5 or 2%. However, he said the Chancellor had allowed greater flexibility for councils to increase their council tax rates up to 3% which meant an increase of £5.53 on a Band D property raising £33,000 revenue.

Councillor Williamson said that the budget gap had been revised to £822,000 and £866,000 savings had been identified and were listed at paragraph 1.20 which delivered a balanced budget for 2023/24. He said the situation for years past 2024 was extremely difficult with a further £6.4m needing to be saved between 2024 – 2027.

Councillor Williamson said the report proposed using the reserves to fund the largest budget gaps. He said he was cautious about using the reserves and they would be paid back towards the end of the Medium Term Financial Plan when the savings targets had been eased.

Councillor Williamson said that the capital programme had been looked at and any lower priority capital spending had been moved into approved but not committed category so do not need to allow for the financing of these items in the Medium Term Financial Plan and provided a further saving.

Councillor Buckmaster said that he felt the recommendations were sensible and was pleased to see a judicious use of reserves. He said that many councils would be increasing their Council Tax to the maximum threshold and he was also pleased to see that the council could continue to help its communities through the UK Shared Prosperity Fund.

Councillor Haysey said that the report noted that the council’s IT outage had meant the finance team lost six days in producing the budget. She thanked the Head of Strategic Finance and Property and his team for putting the report together. She said that the council had to legally produce a balanced budget or it would be declared bankrupt. She said that the council still had the ability to find savings from within its Transformation Programme and still provide residents with quality services but said that there would be difficult decisions to take in future years.

Councillor Curtis referred to recommendation (D) in the report. He asked for clarification on the term ‘smooth the delivery’.

Councillor Williamson said that the Medium Term Financial Plan savings were loaded towards 2024/25/26 so it was proposed that the council use money from reserves so the savings target was reduced. He said that the money would be paid back into reserves so the net position would be unchanged.

Councillor Curtis asked if the Executive Member could be confident that this money could be repaid and not be needed for future expenditure.

Councillor Williamson said that the council could only work on what information they have at the time and it was difficult to anticipate unknowns but he believed it was a prudent use of the reserves.

Councillor Curtis referred to recommendation (E) and asked if the Executive Member was confident that the £400,000 from the New Homes Priority Spend Reserve could be repaid.

Councillor Williamson referred to his response to the previous question. He said this was a further example of using reserves to smooth the delivery of future savings. He said the council could only plan for the years that the Medium Term Financial Plan covered.

Councillor Curtis asked where the £400,000 would come from to repay the reserve fund.

Councillor Buckmaster said that the Transformation Programme would further reduce costs and increase revenue. He said that it was not possible to be exact from where the money would come but it was being worked towards.

Councillor Haysey said that the savings and opportunities were listed in the budget report.

Councillor Curtis referred to recommendation (I) which said powers would be delegated to the Head of Strategic Finance and Property in consultation with the Executive Member for Financial Sustainability. He asked for confirmation that the Executive Member would be making the decision.

Councillor Williamson said that he could confirm that he would be making the decisions. He said that the council should receive further information later in the month about its settlement payment and Officers will then amend the report as necessary for consideration by the Audit and Governance Committee.

Councillor Williamson proposed, and Councillor Buckmaster seconded a motion supporting the recommendations in the report. On being put to the meeting and a vote taken, the motion was declared CARRIED.

RESOLVED – that (A) the proposed budget should make use of the flexibility from Government to increase Council Tax by 3%, which will increase Council Tax revenue by £33,813 a year and will result in a Band D Council Tax increase of £5.53 which is 53 pence a year more than the planned £5 increase included in the Medium Term Financial Plan;

(B)   Leadership Team proceed with the savings plan for 2023/24 for changes under delegated authority and that do not directly impact residents or all of local businesses;

(C) Request Audit and Governance Committee  consider the savings items reserved for Member decision and to advise Executive of any significant adverse impact on the district of recommending to Council these savings are implemented;

(D)   In order to smooth the delivery of the substantial savings targets over the Medium Term Financial Plan that the General Reserve and the Interest Equalisation Reserve are used as reported;

(E)    A temporary use of £400k of the New Homes Priority Spend Reserve, repayable in 2027/28 and 2028/29, may be used to assist with smoothing the delivery of savings as reported;

(F)    The pausing of non-essential capital schemes to prioritise completion of the major projects be agreed; provide essential capital financing for the purchase of food waste caddies and changes to Buntingford Depot as part of the new contract fuel and energy strategy;

(G)   The pausing of the £9.6 million of capital spend will

reduce revenue costs of Minimum Revenue Provision and

interest by £719k per annum on rebased capital financing

charges using current interest rates be noted;

(H)   Note that the savings requirements, that will need to be delivered to balance the budget in the Medium Term, the delivery profile of which has been smoothed using earmarked

reserves, are:

2023/24 £822k

2024/25 £2,170k

2025/26 £2,192k

2026/27 £2,053k

2027/28 £567k.

(I)     Delegate to the Head of Strategic Finance and Property, in consultation with the Deputy Leader and Executive Member for Financial Sustainability, the ability to amend the budget and Medium-Term Financial Plan to reflect the Local Government Finance Settlement and other emerging information, so that Audit and Governance Committee can consider the most complete and up to date information when they scrutinise the budget at their meeting on 24 January 2023; and

(J)     Note that the level of budget reductions required to balance the budget in the medium term is beyond further efficiency measures alone and instructs Leadership Team to commence preparations for the Reconciling Policy, Performance and Resources exercise that the new Council, elected in May 2023, will need to undertake alongside the new Corporate Plan, to balance the budget over the medium term.