Agenda item - Medium Term Financial Plan

Agenda item

Medium Term Financial Plan

Minutes:

In presenting the Medium Term Financial Plan for 2020/21 to 2023/24 the Executive Director, Finance and Resources highlighted to Members a number of areas, including the following:

 

·         The Council Tax for the authority would be considered at the Cabinet meeting on 26th February when all of the calculations for the precepting bodies had been received.  These would be agreed over the next two weeks.

·         It was noted that the Council had only had confirmation of a one year budget from Central Government and estimates had been made for future years.

·         The table on page 45 of the report demonstrated the changes in the financial projections and the pressures and savings achieved, which resulted in a final transfer to balances of £170k.

·         Unavoidable costs were highlighted, in particular the Local Plan Review and independent highways advise that the Council had received and would need as part of the evidence gathering process for the review. 

·         Bids including the revenue impact of capital bids, including the development of a strategy development for parks and green spaces and financial support to the Sunrise Project through the Bromsgrove Partnerships.  It was also highlighted that support to development of the community hubs in Libraries had been discussed in detail at the Overview and Scrutiny Board.

·         Appendix 3 of the report provided details of the additional savings and income, with reference being made to the removal of the estimated payment to the Birmingham LEP.

·         The reduction in pension deficit was also highlighted and that it had been felt prudent to transfer £200k to reserves as it was accepted that investments could be volatile.

·         The reprofiling of the of the capital programme to more accurately reflect planned spend in future years.  It had also been acknowledged that the Investment and Acquisition Strategy of £20m had been a little optimistic.

·         The amount of New Homes Bonus (NHB) had been confirmed as being more than anticipated for 2020/21.  It was not expected that there would be any legacy payments in future years.

·         There was uncertainty around the position in respect of what business rates would look like in the future.

·         Pressures in future years were highlighted in the table on page 49 of the report.

·         The projected position in respect of the general fund balances in future years and savings needed to maintain balances at the recommended level.

 

More detailed information was provided in respect of the District Heating Network, which was detailed on pages 52 to 54 of the report.  Particular reference was made to the detailed discussions which had been held at the meeting on 15th January and responses to the questions raised at that meeting.  The project had now been broken down in to two specific stages and it was confirmed that in respect of the first stage funding had now been secured from the Healthcare Trust of £10k.  As the cost of the first stage was £42.5k and that £10k had also been secured from Bromsgrove School, the cost to this Council was now £22.5k.  This may further reduce should BDHT choose to make a contribution towards the project.  Should the project go ahead to stage 2 then there would be a potential further cost to the Council of £40k but again partners would be asked to make a further contribution.

 

It was noted that the initial costs of the project and the consultant had been paid for by a Government grant and LEP funding, so there had not been any cost to this Council. 

 

The Leader thanked the Executive Director, Finance and Resources and the wider management team for all their hard work in preparing the Medium Term Financial Plan.  This was reiterated by the Portfolio Holder for Finance and Enabling who felt this was the most positive for a number of years.

 

Following presentation of the report, Cabinet Members and those Members attending as observers were invited to ask any questions or comment on the report.

 

·         It was confirmed that the District Heating Project had been deferred at the previous meeting and was now included within the recommendations under recommendation (i).  It was further confirmed that originally £42.5k had been included, but this had now been reduced following contributions from the Health Care Trust and Bromsgrove School totalling £20k, reducing the liability to this Council.

·         Councillor P. McDonald acknowledged the reduction of the cost of the first stage to this Council to £22.5k, but questioned what would happen in respect of the funding of the second stage.  The Executive Director, Finance and Resources responded that the cost of stage 2 was £120k of which a Heat Network Grant of 67% from Central Government would be received, leaving the Council’s liability of £40k.  It was confirmed that the other partner organisations would be contacted with a view to them also making a contribution to this second stage, which would reduce the Council’s liability.  It was further confirmed that discussions the partners organisations would be taking place and these would be followed up with a written request.

·         Councillor McDonald also asked for clarification in respect of the NHB Community Grants Scheme funding.  The Executive Director, Finance and Resources confirmed that due to the increased amount received this would be £147k for the 2020/21 Scheme.

·         Councillor H. Rone-Clarke commented that he had recently attended the Charford Hub where he had been advised of both the work of the Sunrise Project and the Swanswell Project and questioned the role of the Swanwell Project.  The Head of Community Services confirmed that the Swanswell Project provided an alcohol and drug recovery service.

 

RECOMMENDED to full Council

 

a)     Approve the Unavoidable costs as attached at Appendix1:

                                    2020/21 £420k

                                    2021/22 £333k

                                    2022/23 £289k

                                    2023/24 £45k

 

b) Approve the Revenue Bids as attached at Appendix 2 and Appendix 4 (revenue implications of capital spend):

                                    2020/21 £317k

                                    2021/22 £226k

                                    2022/23 £173k

                                    2023/24 £144k

 

c)    Approve the Identified savings as attached at Appendix 3:

                                    2020/21 £510k

                                    2021/22 £677k

                                    2022/23 £746k

                                    2023/24 £817k

 

d)      Approve the Capital Programme bids as attached at Appendix 4:

2020/21 £166k

2021/22 £87k

2022/23 £52k

2023/24 £34k

 

e)    Approve the capital programme as attached at Appendix 5:

2020/21 £4.371m

2021/22 £12.744m

2022/23 £3.743m

2023/24 £1.888m

 

f)     Approve the net general fund revenue budget:

2020/21 £11.812m

2021/22 £11.572m

2022/23 £11.511m

2023/24 £11.324m

 

g)  Approval the increase of the Council Tax per Band D @ £5 for 2020/21.

h)  Approve the transfer to Balances of £170k for 2020/21.

i)  Approve release of up to £72.5k from balances in 2019/20 to provide funding towards the District Heating Feasibility Study forward to Detailed Project Development (DPD) Phase.

 

Supporting documents: