Agenda item

The Council has a statutory duty to set the level of council tax for the forthcoming financial year by 11 March.  The role of the Advisory Board is to assist the Cabinet and Council in the preparation of the Budget for 2019/20 within the context of the Medium Term Financial Strategy and the Council’s priorities.

Note: The revised estimates for 2018/19 and the estimates for 2019/20 are contained in a separate booklet circulated with the agenda.

The report of the Director of Finance and Transformation referred to the responsibility of the Cabinet under the constitution for formulating initial proposals in respect of the budget.  Reference was made to the role of the Advisory Board in assisting the Cabinet and Council in the preparation of the budget within the context of the Medium Term Financial Strategy (MTFS) and the Council’s priorities.  An outline was given of the process for referring the Advisory Board’s recommendations to the Overview and Scrutiny Committee prior to consideration by the Cabinet on 14 February and thereafter by the Council at its Budget meeting.

The Director of Finance and Transformation introduced the provisional Local Government Finance Settlement for 2019/20 which was the final year of the multi-year settlement accepted by the Council.  She indicated that it was relatively positive for Tonbridge and Malling given the removal of the “negative RSG” payment for one year, the fact that the baseline for payment of New Homes Bonus would remain at 0.4%, and the Secretary of State’s decision to maintain the threshold for triggering a referendum on council tax increase at the higher of 3% or £5.  However, Members were advised that the settlement should be viewed in the context of a lack of information about future years’ funding and impact on the funding gap which would have to be revisited in the light of the outcome of the 2019 Spending Review and Fair Funding Review.  In addition, the Kent and Medway authorities’ bid for the next pilot in respect of 75% business rates retention had failed despite the success of the previous pilot so Kent Financial Officers had written a response to the Ministry.

Alongside the provisional settlement, the Secretary of State had published two further consultation papers on the review of relative needs and resources and business rates retention reform.  In view of the timescales involved and the programming of meetings, it was suggested that delegated authority be given for a response to be made as appropriate.

The report set out the framework for considering the estimates in terms of the MTFS together with a number of Service specific issues.  Attention was drawn to partnership funding pressures on Disabled Facilities Grants, public health initiatives and the Community Safety Partnership which it was suggested should be the subject of reviews by the Overview and Scrutiny Committee.

Details were given of the factors to be taken into account when updating the MTFS and Savings and Transformation Strategy (STS).  Progress was reported on savings achieved and the current funding gap.  It was noted that the MTFS would continue to be updated as more information became available and the targets and timescales within the STS would be revisited and realigned with the latest projected funding gap during the budget setting process.

RECOMMENDED:  That

(1)         the proposed increase in the minimum General Revenue Reserve balance from £2.0m to £3.0m be noted and endorsed;

(2)         the draft response to the provisional local government finance settlement 2019/20, as set out in Annex 1 to the report, be noted and updated as appropriate in liaison with the Cabinet Member for Finance, Innovation and Property;

(3)         delegated authority be given to the Director of Finance and Transformation, in liaison with the Cabinet Member for Finance, Innovation and Property, to respond to the two further papers published alongside the provisional settlement as detailed at paragraph 1.3.10 of the report;

(4)         the Overview and Scrutiny Committee be asked to review the service areas Disabled Facilities Grants, Public Health and Community Safety Partnership, as detailed at paragraph 1.7 of the report;

(5)         the draft Revenue Estimates contained in the Booklet be endorsed for consideration by the Cabinet at its special meeting on 14 February 2019; and

(6)         the Savings and Transformation Strategy be updated to reflect the latest projected “outstanding” funding gap as part of the budget setting process.

*Referred to Cabinet