Agenda item

The Cabinet considered a report on the Medium Term Financial Plan for 2015/16 – 2017/18.

The Executive Director Finance and Resources referred to the budget setting process to date.  Members were updated on the various issues which had impacted on the financial position of the Authority and the matters which they would need to take into consideration when determining recommendations to be made to the Council on 25th February 2015.

The Executive Director Finance and Resources reported on the pressures facing the Authority including potential further reductions in the Government Grant Settlement and changes to welfare reform. It was noted that Bromsgrove had gained £23,000 from participation in the Greater Birmingham and Solihull Business Rates Pool  which had been included as funding for use by small businesses in 2015/16.

Members’ attention was drawn to a number of unavoidable pressures which were included in Appendix 1 to the report. These included a reduction in funding from Worcestershire County Council of £26,000 in relation to funding for the Customer Services Centre and the shortfall in anticipated income from car parking and the garden waste collection service. In addition it was noted that following a required review of the charging mechanism, the proportion of the costs of the Building Control Service to be met by this Council would increase.  

Members noted the work undertaken by officers to maximise savings  through transformation and to continue to consider alternative ways of providing improved services to the Community. The Executive Director Finance and Corporate Resources  stated that officers were aware of the need to continue to review budgets to avoid the shortfall predicted over the three years and to mitigate the financial risk to the Council.

The Portfolio Holder for Finance reported in detail on the New Homes Bonus Scheme and referred to the work undertaken by the New Homes Bonus Group which had taken into account views from the public via Public Forums and consultations.

It was reported that whilst the scheme for determining the distribution of New Homes Bonus Funding had been agreed, there was now a need to consider the level of funding to be allocated to the scheme during 2015/16. It was suggested that for 2015/16, 25% of the New Homes Bonus Grant be allocated to the New Homes Bonus Scheme with the 25% being based on the District Council grant which will be received in 2015/16, which is attributable solely to the increase in funding from that received in 2014/15. It was noted that this sum would be £87,000.The NHB scheme had provision for an Annual review to be undertaken.

Members expressed the view that all areas of the District should benefit from difficult decisions taken by the Authority in the past which had led to savings being made. These had to be taken into consideration together with the future impact of any decision not to increase Council Tax.  It was noted that a Government Grant was available equivalent to a 1% rise in Council Tax for Councils who freeze their Council Tax  in the next financial year.

Members noted the new funding arrangements in respect of the Artrix which involved a grant to the Artrix  of £60,000 per annum. Under the previous agreement a sum of £120,000 per annum had been paid over the last ten years.  Members expressed support for the work undertaken by the Artrix but wished to ensure that the best use was made of the proposed funding. It was understood that certain information had been requested from the Artrix in relation to what was to be provided for residents in future and it was felt that the funding should be “ring fenced” until this was received and the position clarified. 

The Portfolio Holder expressed thanks to the officers for the work undertaken on the Medium Term Financial Plan.  

 RECOMMENDED:

(a)       that the following revenue bids be approved:

            2015/16 – 2017/18

£30,000 in relation to providing financial support under the Essential Living Fund Framework

2015/16

£23,000 in relation to providing support to economic development projects to be funded from the income received from the Greater Birmingham and Solihull Business Rates Pool;

(b)       that the unavoidable pressures as detailed in Appendix 1 to the report be approved as follows:

2015/16 - £380,000

2016/17 – Nil

2017/18 - £45,000;  

(c)        that the savings  as detailed in Appendix 2 to the report be approved as follows:

            2015/16 - £547,000

            2016/17 - £222,000

            2017/18 - £25,000;

(d)       that the Council Tax be frozen for 2015/16 and the net position of £63,000 be released from balances in 2015/16;

(e)       that 25% of  the New Homes Bonus Grant be allocated to the NHB Scheme, with the 25% to be based on the District Council grant which will be received in 2015/16 which is attributable solely to the increase in funding from that received in 2014/15. This will equate to £87,000;

(f)        that £87,000 be released from balances to fund the New Homes Bonus Community Scheme; and

(g)       that the following be released from balances:

            2016/17 - £59,000

            2017/18 – 582,000