Agenda item

Medium Term Financial Plan 2023/24 to 2025/26 - Update

Minutes:

The Interim Section 151 Officer presented an update on the Medium Term Financial Plan (MTFP) 2023/24 to 2025/26.

The Department for Levelling Up, Housing and Communities (DLUHC) had announced that the local government settlement would not be confirmed until the week commencing 19^th December 2022. This would be the latest in the year that the settlement had been confirmed and in recognition of this, DLUHC had advised that some information would be made available to Councils in the next few weeks.

In the Chancellor’s autumn statement, it had been confirmed that district Councils would be able to increase Council Tax by 3 per cent, rather than the 2 per cent that had previously been anticipated. Should Bromsgrove District Council choose to increase Council Tax at this level, the increase would result in an additional £92,000 income for the authority. The Chancellor had also announced that Councils would no longer have to pay increases to National Insurance contributions, which would potentially result in £139,000 savings, although the Government had also indicated that funding would subsequently be removed from grants to Councils as a consequence of this, so the level of savings could reduce. It had also been announced that there would be an extension to the Household Support Grant and the Government was consulting with local authorities on the appropriate approach to implementing this scheme.

Officers had been working hard to secure savings in order to achieve a balanced budget in 2023/24. To date, £1.5 million savings had been achieved. In addition, as part of the monitoring report, the unallocated savings that had been included in the MTFP that had been agreed in February 2022 had now been allocated. These savings were detailed in the list of proposed savings in tranche 1 of the budget setting process. A pay award for staff of £1,925 per pay point for 2022/23 had been agreed and, as this was a higher figure than anticipated, this would add to pressures in the budget. The budget gap remained large, primarily due to the anticipated increase in costs arising due to the impact of inflation and increases in utilities costs. Therefore, further savings would need to be agreed in tranche 2 of the budget setting process.

Following the presentation of the report, Members discussed the proposals and noted that Officers were requesting funding for an additional Climate Change Officer post. Questions were raised about the extent to which this post was needed, given the Council already employed a Climate Change Officer, another officer who supported the Climate Change Officer and two lead Heads of Service for climate change. Officers explained that all new proposed posts were reviewed by the Corporate Management Team (CMT) to ensure that they were needed. Heads of Service had responsibility for overseeing the delivery of a wide range of services and were not specialists in respect of climate change. The Officer who had been supporting the Climate Change Officer was shortly due to return to working primarily in her substantive post on environmental waste issues and therefore the new Climate Change Officer would help to support the Council’s work to address climate change, in line with a key priority of the authority to reduce carbon emissions.

Consideration was given to the types of action that could be taken in tranche 2 of the budget setting process in order to reduce costs and secure further savings. Members were advised that Officers would be exploring all possible actions that could be taken to reduce costs, increase income and secure savings. This would include potentially reducing back-office functions and increasing automation of services.

Questions were raised about the extent to which the Council was likely to need to meet further pressures in relation to staff pension costs moving forward. Officers clarified that the information provided in the report was based on figures provided by the Council’s pension actuaries in September 2022. The actuaries had reported that pensions were performing relatively well and the figures detailed in the report would apply for the following three year period.

RESOLVED that

Officers continue to work on additional options, as outlined in the Strategy section of the Tranche 1 Report for presentation to Cabinet in February as Tranche 2 of the Budget.

RECOMMENDED that

the Tranche 1 savings proposals, Fees and Charges increases including updated WRS charges, and the single Growth item in respect of the Climate Change Officer are approved for implementation to ensure maximum benefit as at 1^st April 2023.

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