Agenda item

Brendan Arnold introduced the Medium-Term Financial Strategy (MTFS).

The MTFS had been produced reflective of the Council’s financial position.  The strategy followed two strands; the £11 million budget shortfall for 2024/25 and how resolution on that would be sought, and the £1.2 billion deficit, which would be considered in consultation with DLUHC.

There were two budget steps remaining for the Municipal Year; September 2023 Council, where some budget decisions could be taken early for full next financial year impact, and February 2024 Council, where the full budget would be presented.  The Section 151 Officer added that it was a legal requirement for the Council to have a balanced budget, but that could only be considered achievable by working with DLUHC.

Officers requested the Committee agree to a proposed workshop on the budget before it was presented to Council on 28 September.  The intention was for Members to perform scrutiny of the proposals over a dedicated, and extended, period, which would be presented along with the MTFS to the Executive.  The Chair and Committee agreed to the proposal and discussed the most appropriate time to hold the workshop, recognising that daytime was not practical for most Members due to work commitments.

A second workshop, ahead of the February full Budget, was mooted by Officers.

The Committee discussed the now-suspended Investment Programme that the Chair noted had been included in the February 2023 budget.  Councillor Roberts, Portfolio Holder for Finance, noted that the February 2023 budget was presented with two caveats; the budget could be balanced with use of reserves, and that it was only possible if there was no change to the MRP.

The potential for asset disposals was raised and Brendan Arnold confirmed that there was a statutory duty to seek best value for their disposal.

The Council intended to re-establish a reserve of £35,000 in the next year which would be taken from the various funding streams available to the Council and made separate.

Community Infrastructure Levy funding was discussed and how the money was ring-fenced from other funding.  Councillor Davis raised particular concern over the subject, especially regarding CIL funding being fully ring-fenced in a separate account from other budgets.  The sentiment was agreed by Councillor Roberts and the Chair.  Brendan Arnold agreed to discuss the Councillor Davis’ concerns after the meeting and was producing a briefing note on the subject for all Members.

Consideration in the MTFS had been given to Council Tax and fees and charges.  The Interim Director of Finance clarified that future prices, particularly around parking charges, were as example for modelling only and in no way meant as indicative of what Officers were considering seeking approval for.

Councillor Davis emphasised the need for Council Tax increases to be kept low.  The Councillor also considered that it would be beneficial for residents if indicative costs of providing a service were included to aid in deciding which should be kept, reduced, or removed.

Officers recognised that the high rate of inflation would cause the spending power of Councils to fall until brought lower.  The Government’s 3% limit on increasing Council Tax would lead to a real terms reduction in cost to residents while inflation remained above 3%.

It was noted that the risks listed in the MTFS didn’t include contingency for another pandemic.  Brendan Arnold assured the Committee that, at a point during the Council’s financial recovery, it would be surprising if reserves were not kept for such an eventuality.