Cabinet Portfolio: - Corporate Services, Community Safety and Finance
Strategic Directorate: - Finance and Customer Services
Report to follow
Consideration was given to a report that was submitted for pre-decision scrutiny ahead of the Cabinet meeting scheduled for 20 December 2021 regarding the updated Medium-Term Financial Strategy (MTFS). The Cabinet Member for Corporate Services, Community Safety and Finance, the Strategic Director – Finance and Customer Services and the Assistant Director - Financial Services attended the meeting to present the report.
In introducing the report, the Cabinet Member for Corporate Services, Community Safety and Finance noted that the report set out a review and update of the Council’s Medium Term Financial Strategy up to 2025/26 following the release of the Government’s Spending Review 2021. It was noted that the MTFS would be revised further in advance of the Council Budget setting meeting in March 2022 in order to take account of the Local Government Finance Settlement for 2022/23 and budget policy proposals on levels of council tax and fees and charges and of any budget investment.
The Cabinet Member advised that the MTFS review alongside the latest Financial Monitoring 2021/22 report to Cabinet in November envisaged a balanced financial outturn position being achieved for 2021/22 and made recommendations on reserving funds and savings from 2021/22 in order to support the budget over the medium term. It was also noted that the MTFS forecasts had identified that a balanced budget for 2022/23 could be set with a small funding gap for the following two years. The Strategic Director – Finance and Customer Services advised that the report was a technical update and was a forerunner to the full budget report that would be due early in 2022. The Strategic Director noted that the local government finance settlement that was scheduled to be announced on 16 December along with the latest inflation figures would result in further updates to the figures that were contained in the MTFS.
Members asked whether a backup plan was in place should the work that the Council was carrying out with the Department for Education (DfE) to support local authorities that had large Dedicated School Grant (DSG) deficits did not achieve a mutually agreeable solution of eliminating the Council’s DSG deficit and securing a sustainable DSG position. The Strategic Director advised that current strategy was to carry on in with the negotiations with the DfE in order to reach a sustainable position with regard to the DSG and as such there wasn’t a fully formed backup plan in place. The Strategic Director advised that if negotiations ended without an agreement in place then the Council would need to look at utilising its own resources to support the DSG.
Members asked for further information regarding council tax collection rates. The Assistant Director - Financial Services advised that collection rates had increased during 2020/21 from the previous year, noting that this was a very positive outcome given the financial difficulties that many residents had faced during the pandemic. The Assistant Director also noted how favourably Rotherham compared to other similar local authorities with regards to council tax collection rates. The Assistant Director also assured members that council tax arrears from previous years were still being successfully collected.
Members sought assurance that the most vulnerable residents would continue to be protected from the impact of any future council tax rises. The Strategic Director advised that there were no planned changes to the Council’s local council tax support scheme that supported 14,000 households across the Borough and noted that Rotherham’s scheme was much more generous than those operated by many other local authorities.
Members noted with approval the continued delivery of savings with regard to Adult Care services given the extreme challenges faced by the directorate during the pandemic. Members asked how the projected increase in the number of complex cases would impact on spending as a result impact on the MTFS. The Strategic Director noted that cost pressures in the adult care sector were of a concern but assured members that all assumptions used in the MTFS and budget setting were regularly reviewed in order to ensure all forecasting activity to be as accurate as possible. The Strategic Director – Adult Care, Housing and Public Health, who was in attendance at the meeting confirmed that the budgetary challenges being faced regarded the increased complexity of cases, rather than increasing cases numbers. The Strategic Director – Adult Care, Housing and Public Health advised that the adult care sector and care providers were finding it increasingly difficult to meet the needs of increased numbers of complex cases due to a range of pressures.
Members noted their concern about the savings that had not yet been delivered across the Children and Young People’s Services directorate and sought assurances that the required savings would be delivered in the future. The Strategic Director advised that senior officers in that directorate were confident that future savings targets would be met and noted that £2million of required savings had already been delivered. The Strategic Director assured members that while the delivery of the required savings across the Children and Young People’s Services directorate was challenging, the directorate was rising to the challenge. The Strategic Director noted that while there was a risk that savings may not be delivered on time that it was important to focus on what had been achieved in very challenging circumstances, rather than what had not.
The Chair thanked the Cabinet Member for Corporate Services, Community Safety and Finance, the Strategic Director – Finance and Customer Services and the Assistant Director - Financial Services for attending the meeting and answering member questions.
That Cabinet be advised that the recommendations be supported.