.The Executive Director, Finance and Resources highlighted a number of areas within the Draft Medium Term Financial Plan update report for further consideration by Members, which included:
· When reviewing the budget projections, officers considered the impact of demand on service and the costs associated with this demand. This may result in additional costs (associated with maintaining current service delivery) or reductions in anticipated income revenue over the next four years.
· Unavoidable Costs - A number of budget pressures that have been deemed “unavoidable”. Unavoidable included the ongoing effects of pressures identified during 2018/2019 together with any issues that had been raised as fundamental to maintaining service provision as part of the budget process. In addition income shortfalls that cannot be managed by improved marketing or price increases have been addressed during the budget planning. The unavoidable pressures of £164k were detailed at Appendix 1 to the report.
· Identified Savings and additional income of £133k - These were proposed to ensure that budget pressures could be met and demonstrate the additional income that the Council was generating. This included the income of £80k that had been generated from the service agreement to provide Lifeline services to Cannock Council.
· It was proposed that there were no longer any savings or income allocations that were not specifically identified and therefore there was a pressure to the budget of £654k to reflect the removal of the unidentified savings.
· Negative RSG - £740k. Whilst the final settlement had not been received, the projection included the removal of the £740k negative grant payment to Government.
· New Homes Bonus (NHB) Grant. The amount of NHB for 2019/2020 had been confirmed as £1.589m which was £54k less than anticipated in the Medium Term Financial Plan (MTFP). This was due to the Band D equivalent properties being less than anticipated due to redevelopments not being delivered in the District. The 2019/2020 income would be generated from 363 Band D properties. However, the 0.4% levy on growth equated to 171 properties which resulted in an annual reduction of £227k in NHB Bonus received.
· Future Years – It is assumed that 2019/2020 will be the final year of the NHB scheme. Therefore an estimate of £295k was included in 2019/2020 to continue for 4 years. There was no further funding included in the MTFP for “new” monies from 2020/2021 which would result in a considerable funding gap for the Council. In addition Members would need to consider the impact on the community group funding from 2020/2021. In addition the costs of borrowing for the capital programme were included and the ongoing financial impact of the revised pay model.
At the invitation of the Chairman, the Human Resources and Development Manager provided Members with information on the National Pay Award – Joint Pay Model, as detailed at Appendix 5i of the report.
The Human Resources and Development Manager explained that a two year pay award was agreed Nationally to cover 2018/2019 and 2019/2020. As part of this agreement there was the ... view the full minutes text for item 55