Agenda item

To consider and approve a revised Budget for 2020/21 and an update to the Medium Term Financial Strategy (MTFS) covering both the General Fund and Housing Revenue Account (HRA)

In accordance with The Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014, all local authorities must record in their minutes how each Councillor voted (or abstained from voting) on the question of Budget and Council tax setting at the ‘Budget Decision Meeting’ of the Council. This rule will therefore apply and a recorded vote will be taken on this item.

Councillor Lunn, Lead Executive Member for Finance and Resources provided a presentation on Executive’s revised budget for 2020/21 and the Medium Term Financial Strategy.

The key elements of the presentation were as follows:

·       There had been delays to the Fairer Funding and Business Rates Reviews as a result of the virus.

·       The Council had budgeted for a 2% pay award however the final figure agreed had been 2.75% therefore additional funds needed to be allocated to this.

·       Covid-19 had impacted significantly on the Council’s finances in areas such as additional costs, income losses, delays to savings and creating backlogs in services.

·       As at the end of July, the full year forecast of the impact of Covid-19 for 2020/21 was £3.8m for the General Fund and Housing Revenue Account. It was noted that the Council had received £1,068m emergency funding from the Government to compensate for some of the impact however the revised estimates assume no further support would be provided.

·       Additional funding had been added to operational contingency for the local government reorganisation for potential added costs.

·       Other additional pressures included planning fees, leisure income and the street scene contract.

·       There would be £400k less to the Major Repairs Reserve for the Housing Revenue Account which would leave £8.7m for the improvement programme.

·       The Council would assume that the 2021/22 Local Government Finance Settlement would be a further one year roll over.

Members debated the proposals. A query was raised regarding any underspends in the budget. The Lead Executive Member for Finance and Resources explained that any underspends had been compensated by the additional spending on areas such as technology to ensure the Council was prepared for working in the current circumstances.

Councillor Packham on behalf of the Labour Group responded to the proposals and outlined the following comments:

·       It was acknowledged that forward projections were difficult given the risk and uncertain climate.

·       Concern was raised regarding the impact of the local government re-organisation and the savings that it may bring.

·       Concern was raised that the additional income from Business Rates and Council Tax at the expected levels may not occur.

·       The projected rise in planning income seemed optimistic and was contradicted in a separate area of the report.

·       Concern was raised at the impact in the reduction of service related government grants for homelessness and it was suggested that further discussion take place regarding this when future budgets are produced.  

·       Questions were raised over the employment of agency staff and whether the planned savings would be achievable.

In line with the Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014, the Chairman explained that a recorded vote must be taken on this item.

For the proposal: 30

Councillors K Arthur, D Brook, D Buckle, J Cattanach, I Chilvers, J Chilvers, M Crane, S Duckett, J Duggan, K Ellis, K Franks, T Grogan, E Jordan, M Jordan, A Lee, C Lunn, D Mackay, J Mackman, J McCartney, M McCartney R Musgrave, W Nichols, B Packham, C Pearson, N Reader, J Shaw-Wright, S Shaw-Wright, R Sweeting, M Topping, and P Welch

Against the proposal: 0

RESOLVED:

The Revised Estimates for 2020/21 and the Medium-Term Financial Strategy be approved.

REASON FOR DECISION

To reflect the latest financial issues within the budget for 2020/21 and to set the framework for the 2021/22 budget and Medium-Term Financial Plan to 2023/24.