Agenda item

Budget Strategy 2021/22 – 2025/26

To consider report FIN/508 of the Head of Corporate Finance.

Minutes:

The Commission considered report FIN/508 with the Leader of the Council, Head of Corporate Finance and Chief Accountant. The report set out the projected financial position for 2021/22 to 2025/26 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:

·       It was noted that the pension fund benefits from effective investment and there were advantages to keeping the pension fully funded.  Whilst local government pay was negotiated nationally, should a pay freeze be agreed this would assist in the committed reserves.

·       Confirmation that whilst the town centre would require additional support post-Covid, the newly formed Town Centre BID intended to have a positive impact on the area, to work hard to create a safer Town Centre for shoppers, businesses, their employees and grow the number of visitors.  The Economic Development Team would work with the BID, retail, key partners and stakeholders within the town and continue to provide its services, using various different methods following the pandemic.

·       Confirmation that whilst the overall objective had in the past been to work towards a balanced general fund budget over a three year period, due to the pandemic the recommendation was to work towards balancing this over a four year period.

·       Explanation that the final year for New Homes Bonus for four years was 2019/2020, resulting in 2022/23 for the final legacy payments.  The New Homes Bonus received for the current year was for one year only.

·       Confirmation that the budget gap within the budget projections was a cumulative figure.

·       Acknowledgement that table 4 within section 6.2 should commence with years 2021/2022.

·       Recognition that the report had assumed that all contracts would be fully operational on 1 April 2021 with no financial impact.  Whilst at this stage this was unlikely and a Covid reserve had been established.

·       Confirmation that the government grant for ‘Transparency’ had not been ring-fenced and there were no conditions attributed to the grant.

·       Explanation that the investment properties listed within the Capital Strategy linked to those within the Treasury Management Strategy and were purchased for the sole purpose of achieving a yield. Further properties still achieved a yield but were either already owned or purchased for another reason (Telford Place achieved a yield as a car park, however the primary purchase purpose was affordable housing).  It was queried if the cost of acquisition could be included. However the cost price may not bear relation to the valuation or include any property works. 

·       Concerns were raised regarding the earmarked reserves for the town centre market transferring to a Covid support reserve. In response it was noted that the nature of the town centre as a result of the pandemic would be undergoing rapid change and this included the market.  Different options needed to be considered for retail as a whole.

·       Confirmation that the amount attributed to the works at Milton Mount flats were the total costs.  The income was then accounted from the leaseholders separately.

·       Clarification sought and provided on retained business rates and the details provided within the appendices.

 

RESOLVED

That the Commission notes the report and requests that the views expressed during the debate, are fed back to the Cabinet through the Commission’s Comment sheet.

 

 

Supporting documents: