Agenda item

Medium Term Financial Plan 2021/22 - 2024/25 including Capital Programme

Meeting of Virtual Meeting - Teams, Cabinet, Wednesday 17th February 2021 6.00 p.m. (Item 68/20)

This item is to be pre-scrutinised by the Overview and Scrutiny Board at its meeting on 15^th February 2021 therefore any recommendations arising from that meeting will be tabled for Cabinet’s consideration.

Minutes:

The Head of Financial and Customer Services presented the Medium Term Financial Plan 2021/22 to 2023/24 and in so doing highlighted the following points for Members’ consideration:

· The budget had been prepared at a difficult time, in the midst of a global pandemic and at a time of uncertainty for local government finances.

· District Councils could increase Council Tax by a maximum of 2.99 per cent or £5. Officers were proposing that Council Tax should be increased by £5 in Bromsgrove as this would result in a slightly higher rate of return to the Council.

· There had been a sizable gap in the budget for 2021/22 which had had to be addressed in balancing the budget.

· Additional pressures, including loss of income from car parking fees, had needed to be taken into account, though some of the losses in income from parking had been offset by the financial support provided by the Government.

· The Corporate Management Team (CMT) had reviewed the Council’s budget on a line-by-line basis and had identified a number of savings and income opportunities in doing so.

· Many of the savings that had been reported were relatively small. However, cumulatively the savings contributed to balancing the budget for 2021/22.

· Funding had been received from the New Homes Bonus (NHB) for 2021/22. However, there was uncertainty about the availability of funding from this or a replacement scheme in future years.

· The proposed budget would result in a return of £22,000 to balances in 2021/22. However, there remained gaps in the budget in 2022/23 and 2023/24 which would need to be addressed moving forward.

· The Council would be using £638,000 from reserves to help balance the budget in 2021/22. This funding could not be reused in future years.

· The Council’s balances remained in excess of £1 million. The strength of the Council’s balances compared favourably with other district Councils.

· A significant bid for capital funding had been included for Disabled Facilities Grants, though Members were asked to note that these were not funded by the Council.

· There was a large bid for capital funding for electric vehicle charging points, though Cabinet was advised that some of these costs could be met through grant funding.

· The Covid-19 pandemic had added to the uncertainty regarding local government finances. The continuing impact of the pandemic was difficult to predict.

· Brexit was also adding to uncertainty about the future financial position of the Council. There was the possibility that Brexit would impact on local businesses and subsequently on future business rate collections, though this remained to be clarified.

Following the presentation of the report, the Portfolio Holder for Finance and Enabling thanked the Financial Services team for their hard work. It was acknowledged that budget preparation had been particularly challenging during the Covid-19 pandemic and that this had occurred at a time when the Financial Service Team were also working hard to distribute grant funding to local businesses. However, Members commented that despite this, the Council was proposing a balanced budget.

Cabinet was informed that 2021/22 would be the first year in which the Council Tax base would decline, by £74,000. In part, this was due to the impact of the Covid-19 pandemic, as fewer houses had been built during 2020/21 as a consequence. In addition, the proposed changes to the Council Tax Support Scheme would result in a lower rate of return to the Council, as extra support would be provided to the most vulnerable residents.

Members welcomed the proposed funding that would support the green thread in the Council Plan. This included the proposed capital funding for electric vehicle charging points and, as well as supporting the green agenda, Members commented that this would support initiatives to encourage people to return to the town centre once the pandemic had ended, to the benefit of local businesses. Cabinet also welcomed the proposed capital funding for the purchase of a new electric bus, which would help to connect Bromsgrove town centre to Bromsgrove Railway Station. Members commented that this would enable more people to access Bromsgrove town centre moving forward, which would help the local economy.

During consideration of this item, Members highlighted a typographical error in respect of the figures that had been provided for Council Tax. In the report it had been recorded that there would be demand on the collection fund to meet the Council’s needs at £8.64 million but later in the report it had also been reported that in 2021/22 a total of £8.665 million was due to be collected. Officers agreed to check the accuracy of the figures provided prior to Council.

RECOMMENDED that

1) The Unavoidable costs be approved:

2021/22 £524k

2022/23 £340k

2023/24 £409k

2) The Revenue Bids be approved:

2021/22 £65k

2022/23 £48k

2023/24 £25k

3) The Identified Savings be approved:

2021/22 £426k

2022/23 £474k

2023/24 £405k

4) The General Fund Capital Programme bids be approved:

2021/22 £578k

2022/23 £1.123m

2023/24 £1.018m

5) The General Fund capital programme be approved:

2021/22 £13.323m

2022/23 £4.867m

2023/24 £2.906m

6) The net general fund revenue budget be approved.

2021/22 £11.988m

2022/23 £11.673m

2023/24 £11.683m

7) The increase of the Council Tax per Band D at £5 for 2021/22 be approved; and

8) The transfer to Balances of £22k for 2020/21 be approved.

Supporting documents: