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 both the Cabinet and the Council in the preparation of the Budget for 2020/21 within the context of the Medium Term Financial Strategy and the Council’s priorities.
NB The Revised Estimates for 2019/20 and Estimates for 2020/21 are set out in a separate supplementary Annex.
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 13 February and thereafter by the Council at its Budget meeting.
The Director of Finance and Transformation advised that the provisional Local Government Finance Settlement for 2020/21 was still awaited when the report was prepared and figures had been based on the Technical Consultation published on 3 October 2019 which suggested that the settlement would be similar to that in 2019/20. The subsequent settlement when received confirmed this position although a slight adjustment would be necessary when reported to Cabinet. As a result 2020/21 could be regarded as a “holding year” with future funding dependent on the outcome of the delayed government Spending Review and Fair Funding Review.
It was also expected that the threshold for triggering a referendum on council tax increase would be at the higher of 2% or £5. The report set out the framework for considering the estimates in terms of the MTFS together with a number of Service specific issues which were highlighted.
Details were given of the factors to be taken into account when updating the MTFS and Savings and Transformation Strategy (STS). In October 2019 an interim high level review suggested a funding gap of £800,000. Since then a series of decisions or recommendations had been made by Members and incorporated in the draft Estimates which had, amongst other things, reduced the projected outstanding funding gap to £320,000. 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.
(1) subject to review each year, the maximum “annual capital allowance” be increased from £200,000 to £250,000;
(2) 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 provisional local government finance settlement as appropriate;
(3) the establishment of a specific earmarked reserve in the sum of initially £250,000 to fund Climate Change initiatives be endorsed;
(4) the establishment of a Budget Stabilisation reserve in the sum of £3,500,000 be endorsed to manage risk and/or assist in meeting future savings and transformations;
(5) the draft Revenue Estimates contained at Annex 1 to the report, as amended at (7) below, be endorsed for consideration by the Cabinet at its special meeting on 13 February 2020;
(6) the Savings and Transformation Strategy be updated to reflect the latest projected “outstanding” funding gap as part of the budget setting process; and
(7) the budget for Borough Christmas Lighting be capped at £40,000.
*Referred to Cabinet