Agenda item

To consider and decide on the recommendations as set out in the attached report.

RESOLVED –

1. That support for the Budget Strategy be reaffirmed;
2. That consultation relating to the budget be undertaken in three phases: an initial phase to gather the views of residents and businesses on potential areas of savings and optimising income; a second phase to be undertaken by the Overview and Scrutiny Committee; and a third phase in December and January to consult on the impact of proposals following the publication of the Draft Budget and Medium Term Financial Strategy be approved.

REASON FOR DECISION:

To agree the form of consultation and begin the process of setting the budget for 2021/22.

Lee Colyer, Director of Finance, Policy and Development introduced the report that outlined the assumptions that had been built into the proposed budget for 2021/22 and provided projections for the next five years.

Discussion and responses to Members questions included the following:

-       This was the first report in the process of setting the budget for 2021/22. 

-       The base budget within the medium term financial strategy had been updated to reflect the following main adjustments.

-       The postponement of the Borough elections would now need to be funded in May 2021

-       The postponed fair funding review which enabled the removal of the £200k reduction that had been anticipated for the Council.  It was now assumed that any adjustment to retain the Business Rate base line would be neutral to effect the need for Government to put more funding into Local Government.

-       The eschewed recurring 1% increase in the tax base had now been removed.  This reflected the likely impact of an increase in take up of Council Tax Support claims.

-       If the projected income losses levelled off at £250k per month and on the assumption there was no Government support scheme in place for next financial year this would leave a £3m reduction in income (at this point in time).

-       These changes resulted in a projected budget gap at this stage of £3.5m.

-       This budget gap could not be left unmanaged.  The projections would continue to be updated on a regular basis to reflect the budget management approach taking account of actual income expenditure, local economic data and levels of Government support. 

-       Government had been clear, drastic decisions should be avoided and instead Councils should use their reserves and other resources to both get the Council and their contractors through this period. 

-       The Government’s autumn statement would need to include an injection of new funding into Local Government to support revenue budgets.  If the Government failed to provide sufficient funding that was certain and reliable then Local Government would not be able to continue to provide the range and quality of services expected by the public. 

-       In anticipation of this scenario the Government had announced there would be a White Paper in the autumn that would set out the process for the Local Government reorganisation which could potentially see the replacement of Borough and County Councils with new Unitary Councils in two tier areas.

-       There remained uncertainty around the funding of leisure centres, theatres and the Amelia Scott project which would have a further financial impact, details of which would be set out in separate reports. 

-       Challenges were considerable, but the Council’s approach accorded with Government advice and was in a healthy position with options available to fund local services and support the community and businesses until the Government came forward with a sustainable funding model for the Local Government sector.

RESOLVED –

1. That support for the Budget Strategy be reaffirmed;
2. That consultation relating to the budget be undertaken in three phases: an initial phase to gather the views of residents and businesses on potential areas of savings and optimising income; a second phase to be undertaken by the Overview and Scrutiny Committee; and a third phase in December and January to consult on the impact of proposals following the publication of the Draft Budget and Medium Term Financial Strategy be approved.

REASON FOR DECISION:

To agree the form of consultation and begin the process of setting the budget for 2021/22.