Agenda item

To consider a report outlining proposals for the Council’s Budget and Council Tax for 2023/2. The proposals are based on the Council’s Provisional Local Government Finance Settlement for 2023/24, budget consultation and the consideration of Directorate budget proposals through the Council’s Budget process alongside a review of the financial planning assumptions within the Medium Term Financial Strategy (MTFS).

Cabinet Portfolio: The Leader

Strategic Directorate: Finance and Customer Services

The Board considered a report outlining proposals for the Council’s Budget and Council Tax for 2023/24. The proposals were based on the Council’s Provisional Local Government Finance Settlement for 2023/24, budget consultation and the consideration of Directorate budget proposals through the Council’s Budget process. The report also reviews details of the financial planning assumptions within the Medium-Term Financial Strategy (MTFS).

The Chair invited the Leader to present the report. Also in attendance were the Deputy Leader and the Cabinet Members for Adult Care and Public Health; Children and Young People; Corporate Services, Community Safety and Finance; and Housing. Apologies were received from the Cabinet Members for Jobs and the Local Economy; Social Inclusion; and Transport and the Environment.

In opening, the Leader outlined that there was an £6m funding gap which had resulted from pressures outside the Council’s control, such as the national pay award, inflation and rising energy costs. It was highlighted that since the last financial monitoring report was considered, the provisional settlement had been announced which had led to a slightly better position however it would not address the funding pressures fully. The use of reserves would be required , however this had to be done on a sustainable basis.

The Leader highlighted the prioritise underpinning the budget proposals. These were to protect frontline services; avoid placing additional burdens for people on lower incomes; and ensure that services were on a sustainable footing year on year.

The proposals outlined £4 million of cost reductions some of which were permanent savings, with others being offered on a temporary basis. The proposals also contained £0.5m of investments which could be achieved in the current climate.

The Chair thanked the Leader for his introduction and invited members to ask questions and a discussion on the following points ensued:

·       The challenges of making budget projections in light of inflationary and energy cost pressures and the necessity of using reserves to meet the shortfall.

·       Whether greater emphasis should be given to the impact of financial austerity on the delivery of services. It was outlined that the press release accompanying budget proposals referred explicitly to the effect this had had on people’s lives and the Council’s ability to deliver services.

·       Relatively few of the budget savings proposals would be carried over to next year’s budget as these were one off savings.

·       It was confirmed discussions had taken place about the use of reserves and sustainability. it was felt that reasonable assumptions had been made concerning next year’s position.

·       Assumptions about final grant allocations were made on the basis of previous allocations. Any shortfall may require further use of reserves, however that measure was thought unlikely.

·       The budget assumptions were based on the best available information. If these assumptions were incorrect, the Council would need to take further action in year 3 to rectify.

The Leader outlined the proposals relating to fees and charges (as outlined in Appendix 7 of the report). In a typical year a 2% increase would be assumed, however in light of the rate of inflation, a 6% increase was proposed for 2023/2024, with a 5% increase in future years. It was highlighted that this was below the rate of inflation to mitigate the impact on residents whilst protecting access to basic services. The proposals to exempt some services from the increase were detailed in the body of the report.

The Chair invited questions from the Board in respect of these proposals,

·      Further details were sought if benchmarking had been undertaken with comparative authorities to establish if the proposals in respect of garage rent and car parking spaces were affordable and usage maximised. An analysis would be undertaken by the service.

·      It was noted that charges had been applied for replacement bins in some circumstances. It was not thought that this would be detrimental to recycling targets.

·      Clarification was sought if the proposals would have any impact on those eligible for Rothercard. It was noted that the next stage of the Rothercard review would assess available discounts.

·      The proposal to exempt market traders from increases to fees and charges were noted. A view was expressed that this would assist to make the trader base sustainable and ensure that a town centre market was viable.

·      In respect of housing and district heating charges, it was noted that this came under the Housing Revenue Account.

·      It was outlined that there was a shortage of staff to deliver home care packages. The Council was working with the market to influence and create a stable employment base.

The Leader outlined the Proposed Revenue Investments 2023/24 (as detailed in Appendix 2 of the report) relating to Council Plan theme. The Chair invited questions on the proposals therein.

·      In respect of the Expanding Economic Opportunity theme, it was noted that it was proposed that there was a 50% discount on market rents during the period of redevelopment. In light of changing shopping habits, it was queried if the proposals would support the market offer. In response, it was suggested that footfall would increase because of the redevelopment. It was also noted that that the “Thursday Bazaar” had attracted new customers.

·      In respect of proposals supporting A Cleaner, Greener Environment, it was noted the capital investment would improve on site services at Household Waste Recycling Centres. It was also noted that two smaller vehicles would be purchased to collect household waste in areas with narrower streets. Options for the expansion of commercial waste collection and recycling were outlined.

·      In respect of the One Council theme, the proposals to improve call handling and online information was noted.

The Leader outlined the Proposed Capital Investments (as detailed in Appendix 3A of the report) relating to Council directorates. The Chair invited questions on the proposals therein.

·      Further details were sought on the investment to Bereavement Services and how this related to Dignity’s contractual arrangements. It was noted that the proposed additional activities sat outside the current contract.

·      The proposed investment to restore the Waterloo Kiln was welcomed. It was noted that matched funding had been secured.

The Leader outlined the Proposed Revenue Saving Proposals (as detailed in Appendix 4 of the report) relating to Council directorates. The Chair invited questions on the proposals therein.

·      Further details were sought on the impact of holding vacant Early Help posts in Children and Young People’s Services. It was outlined that there had been difficulties recruiting to those vacancies. The workload had been absorbed and delivered within the service without detriment. It was noted that Family Hubs would be introduced over the next year and therefore the staffing establishment would be reviewed in light of these developments.

·      It was noted that discussions would take place on longer term vacancies to determine if savings could be made. The impact on service delivery would be a key consideration.

·      It was noted that the number of children in care had reduced safely, however the cost of placements remained challenging. It was anticipated that this downward trend would continue. Work was underway with families to support children remaining at home safely.

·      In relation to the savings attached to Family Hubs and Start for Life Funding, it was clarified that the savings equated to the use of one-off additional grant income to fund the management of the change programme. The savings would not impact on the capacity of the service.

·      In respect of the proposals regarding Bereavement Services it was anticipated that some income would be recovered through penalties clauses.  This had been reflected in the projections. Prior to 2022, no penalties had been levied.

·      It was anticipated that the savings attached to IT contracts was achievable. It was acknowledged that the value of contracts may fluctuate and therefore was difficult to formulate proposals for permanent savings at this stage.

·      It was outlined that the Change and Innovation team had been established to deliver the “Big Hearts, Big Changes” transformation programme. This was largely complete and responsibility for delivery laid with individual directorates. Remaining staff would support the Council’s Organisational Development function and special projects. In respect of the deletion of an entry-level policy post, it was noted that the work had been absorbed by the service. Alternatives such as apprenticeships were also being explored.

·      In respect of proposals to realign the workforce model in adult social care, it was outlined that the proposals would require external agencies to undertake their own training rather than this being provided by the Council. It was anticipated that the measures would reduce duplication. Provision of training would be monitored through contracts to ensure standards were maintained.

·      It was noted that the medical equipment and wheelchair service would be provided by an external body.

·      It was noted that more options for supported living solutions for people with mental health issues were being introduced, lessening the dependence on residential placements.

The Chair thanked the Leader, Cabinet Members and officers for their contributions.

Resolved:

1)    That Cabinet be advised that the following recommendations be supported.

That Cabinet recommend to Council:

1.      Approval of the Budget and Financial Strategy for 2023/24 as set out in the report and appendices, including a basic Council Tax increase of 2% and an Adult Social Care precept of 2%.

2.      Approval of the proposed extension to the Local Council Tax Support Top Up scheme, that will provide up to £117.60 of additional support to low income households most vulnerable to rising household costs, through reduced Council Tax bills as described in section 2.5.11-14.

3.      Approval of the updated Medium Term Financial Strategy (MTFS) to 2025/26, as described within section 2.6.

4.      Approval of the Reserves Strategy as set out in Section 2.9 noting that the final determination of Reserves will be approved as part of reporting the financial outturn for 2022/23.

5.      To note and accept the comments and advice of the Strategic Director of Finance and Customer Services (Section 151 Officer), provided in compliance with Section 25 of the Local Government Act 2003, as to the robustness of the estimates included in the Budget and the adequacy of reserves for which the Budget provides (Section 2.14).

6.      To note the feedback from the public and partners following the public consultation on the Council’s budget for 2023/24 which took place from 19 December 2022 to 22 January 2023, attached as Appendix 10.

7.      Approval of the proposed increases in Adult Social Care provider contracts and for Personal Assistants as set out in Section 2.4.

8.      Approval of the revenue investment proposals set out in Section 2.7 and Appendix 2.

9.      Approval of the Council Fees and Charges for 2023/24 attached as Appendix 7.

10.   Approval of the revenue savings proposals set out in Section 2.8 and Appendix 4

11.   Application of the Business Rates Reliefs as set out in Section 2.10, in line with Government guidance. 

12.   Approval of the proposed Capital Strategy and Capital Programme as presented in Section 2.12 and Appendices 3A to 3F.

13.   Approval of the Treasury Management matters for 2023/24 as set out in Appendix 9 of this report including the Prudential Indicators, the Minimum Revenue Provision Policy, the Treasury Management Strategy and the Investment Strategy. 

14.   Approval of the Flexible use of Capital Receipts Strategy 2023/24 (Appendix 5).

15.   Approval that the projected 2022/23 revenue outturn overspend will be funded from the Council’s corporate reserves as indicated within section 2.9.

16.   Approval that any changes resulting from the Final Local Government Finance Settlement 2023/24 be reflected in the Budget and Council Tax Report to Council on 1 March.  

17.   It is recommended to continue with the principles and measures adopted since April 2020 to make faster payments to suppliers on receipt of goods, works and services following a fully reconciled invoice as described in section 2.11.

18.   Approval that the Capital Programme Budget continues to be managed in line with the following key principles:

(i)      Any underspends on the existing approved Capital Programme in respect of 2022/23 be rolled forward into future years, subject to an individual review of each carry forward to be set out within the Financial Outturn 2022/23 report to Cabinet.

(ii)    In line with Financial and Procurement Procedure Rules 7.7 to 7.11 and 8.12, any successful grant applications in respect of capital projects will be added to the Council’s approved Capital Programme on an ongoing basis.  

(iii)   Capitalisation opportunities and capital receipts flexibilities will be maximised, with capital receipts earmarked to minimise revenue costs.