Issue - meetings

The Leader’s Portfolio

To consider report FIN/537 of the Head of Corporate Finance, which was referred to the meeting of the Overview and Scrutiny Commission held on 22 November 2021.

RESOLVED

That the Cabinet recommends to Full Council the approval of the Budget Strategy 2022/23 to 2026/27 and to:

a)         Note the uncertainties around Government funding prior to the settlement in December and the delay in Local Government Funding reforms such as business rates retention and the future of New Homes Bonus.

b)         Note, for the purpose of projections, the current budget deficit of £138,566for 2022/23 before use of reserves, on the basis of a Council tax increase of 2.31% which is £4.95 on a Band D in property 2022/23. 

c)         Work towards balancing this over a four-year period, including putting back into reserves when the Budget is in surplus.  There may be a need to use reserves over the next three to four years to balance the budget together with ongoing savings, efficiencies and additional income through the transformation programme.

d)         Note elsewhere on this Agenda there is a report on the Climate Change Emergency Action Plan.  The costs identified in 2022/23 are included within existing budgets, however there will be a need to fully cost the plan over the coming years and decisions will be required on how to fund the plan.

e)         Note that savings previously agreed and included in the Budget Strategy are required to ensure a sustainable budget.

f)          Delegate to the Leader of the Council in consultation with the Chief Executive and the Head of Corporate Finance to approve a discretionary business rates scheme to distribute the share to Crawley Borough Council of the £1.5b business rates relief as outlined in Section 5.3 of report FIN/537.

g)         Note that items for the Capital Programme are driven by the need for the upkeep of council assets and environmental obligations and schemes will also be considered that are spend to save or spend to earn but that such prioritisation should not preclude the initial consideration of capital projects that could deliver social value.

h)         Agree the inclusion of new capital schemes in future budgets with the value of £948,460 as identified in Table 8 of report FIN/537.

i)          Reduce the Gigabit capital programme of £2.7m to £1.35m funded from the West Sussex business rates pool to avoid duplication with Towns Fund Gigabit scheme as identified in section 9.3 of report FIN/537.

j)          Approve the revised Crawley Homes capital investment plan in Appendix D of report FIN/537 which includes the financial year 2024/25 and the garage repairs capital budget which was transferred to the General Fund.

k)         Note that the Budget is aligned to the Council’s Corporate Priorities.

Reasons for the Recommendations

a)         To continue with the implementation of the Council’s budget strategy and to deal with the Council’s projected budget deficit which is higher than previously projected due to the impact of the pandemic on future Council tax and Business rates income projections and also impacting other income sources such as fees and charges.

b)         To reaffirm the criteria for capital programme bids.

c)         To note that until the Local Government Finance  ...  view the full decision text for item 6

The Leader of the Council presented report FIN/537 of the Head Corporate Finance.  The report set out the projected financial position for 2022/23 to 2026/27 for the General Fund, Housing Revenue Account, capital programme and the underlying assumptions.  The report also set the policy framework for the budget process, recognising that there were a range of options for capital investment, income generation, savings and Council Tax levels; none of which were to be considered in isolation.  The overall objective was to work towards a balanced General Fund budget over a four-year period, this however may be difficult due to the impact of the Coronavirus pandemic.  The Leader commented that the difficult decisions taken last year had meant that the Council was in a better position than expected and similar decisions were not required to be taken this year.

It was noted that currently there was a budget deficit of £138,566 for 2022/23 before use of reserves and before any savings are identified, on the basis of a Council tax increase of 2.31% which is £4.95 on a Band D in property 2022/23. It was proposed also to budget a further £948,460 for new capital schemes.

Councillor T Belben presented the Overview and Scrutiny Commission’s comments on the report to the Cabinet following consideration of the matter at its meeting on 22 November 2021, which included:

·         Acknowledged that any costs associated with the climate change action plan had not been budgeted and may require in savings being sought.

·         The Commission were pleased that the pension fund had surpassed expectations resulting in a £145,000.

·         Also noting the floor letting of the Town Hall was slower than expected in light of the impact of the pandemic and the new ways of working and that might lead to the need for further savings in the future.

Councillor Crow was invited to speak on the item commenting that the budget projections were pleasing, but the Council should remain vigilant as it was finely balanced, and a small knock could easily affect the projection.

Councillor Jones complimented the Budget Strategy and commented that it was a real achievement in light of a very difficult year.

RESOLVED

That the Cabinet recommends to Full Council the approval of the Budget Strategy 2022/23 to 2026/27 and:

a)         Notes the uncertainties around Government funding prior to the settlement in December and the delay in Local Government Funding reforms such as business rates retention and the future of New Homes Bonus.

b)         Notes, for the purpose of projections, the current budget deficit of £138,566for 2022/23 before use of reserves, on the basis of a Council tax increase of 2.31% which is £4.95 on a Band D in property 2022/23. 

c)         Works towards balancing this over a four-year period, including putting back into reserves when the Budget is in surplus.  There may be a need to use reserves over the next three to four years to balance the budget together with ongoing savings, efficiencies and additional income through the transformation  ...  view the full minutes text for item 6

To consider report FIN/537 of the Head of Corporate Finance.

The Commission considered report FIN/537 with the Leader of the Council, Head of Corporate Finance and Chief Accountant. The report set out the projected financial position for 2022/23 to 2026/27 for the General Fund, Housing Revenue Account, capital programme and the underlying assumptions.  The report also set the policy framework for the budget process, recognising that there were a range of options for capital investment, income generation, savings and Council Tax levels; none of which were to be considered in isolation.  The overall objective was to work towards a balanced General Fund budget over a four year period, this however may be difficult due to the impact of the Coronavirus pandemic. 

The Commission received clarification on a number of points within the report during the discussion with the Leader of the Council, Head of Corporate Finance and Chief Accountant.

Councillors made the following comments:

·        Harsh decisions taken last year have resulted in an acceptable outcome, however it was acknowledged that the final settlement from central government was still outstanding.

·        It was noted that any costs associated with the climate change action plan will have to be fed into future budget processes and may result in savings being sought.

·        Query sought on the decline in retained business rates and estimated NNDR compared to the assumed projections. This was due to an assumption of a business rates reset in 2025/26 and the business rates equalisation reserve being utilised in the first few years of the strategy.

·        Acknowledgement that the pension fund was fully funded as it had exceeded targets over the last three years, the saving in 2022/23 would be £145,000.

·        It was noted that the waste collection changing to fortnightly household waste whilst not approved would save £250,000. It was commented that as COP26 had just ended it would be a beneficial time to lead by example and implement food collection and fortnightly waste collection.

·        Recognition that resources had been impacted over the course of the pandemic, financial resources, funding and grants available and it was clear that the financial pressures were going to continue for several years.

·        Acknowledged that it still uncertain as to when the position with regards to Natural England and planning applications would be resolved.

·        Disappointment was expressed that if there was a slower than anticipated take up of floor letting for the new Town Hall as a result of the impact of the pandemic and the new ways of working, savings may have to be sought in future.

·        It was commented it would be beneficial to include the income being made from each investment property within the appendices.

·        Officers were thanked for providing detailed reasons for reserves within the report.

RESOLVED

That the Commission noted the report and requested that the views expressed during the debate, were fed back to the Cabinet through the Commission’s Comment sheet.