The Lead Member for Corporate Services introduced the report and stated that the budget setting process had begun in November 2022, with the intention of identifying £2.5 million in savings for 2023/24. Since then, the Chancellor’s Autumn Statement and Local Government Finance Settlement had been released. From the latter, the Council Tax Referendum Limit had been increased to 3%, alongside the provision of the Funding Guarantee for Local Authorities; the latter was based on the Council’s core spending power and provided additional funding.

The Lead Member for Corporate Services stated that the Medium-Term Financial Strategy (MTFS) had been drafted with the assumption that council tax would be increased up to the 3% limit. A variety of financial scenarios had been modelled as part of the process, with specific attention given to the high-inflation scenario. Over £1 million in savings had been identified for the 2023/24 financial year, with emphasis given to the fact that the MTFS covered a five-year period. The next few years were likely to be challenging for the Council financially, although the Council was likely to achieve a balanced budget for 2023/24. The importance of taking a prudent approach to the Council’s finances was highlighted.

Specific attention was drawn to the Funding Guarantee, which was assumed to be a one-off source of funding; £300,000 had been allocated to strategic planning for the 2023/24 financial year with an assumption that the remainder would be used to support the Affordable Homes Programme. The Committee were asked for its views on using some of the Funding Guarantee, to increase the 5% staff pay increase budgeted for within the budget planning process, without making further savings.

The Director of Finance, Resources and Business Improvement stated that the final settlement would be negotiated and decided by the Head of Paid Service, with Member involvement in the decision being restricted to the allocation of the funds for employee renumeration. The matter would be considered by the Committee in a report due to be presented at its next meeting.

Several Members of the Committee expressed support in principle for an increase in staff salary, with a range of contributing factors referenced including appreciation for the Council’s staff, encouraging retention and the high cost of recruitment. However, the importance of ensuring that any increase provided was sustainable across future years was reiterated following discussion on the use of one-off funding to support an increase, as otherwise this could contribute to the Council’s future financial pressures.  The importance of ensuring services continued to be provided was highlighted. A variety of options were suggested, including higher increases for staff on lower pay grades. Reference was made to the difficulties of improving staff renumeration whilst increasing council tax. The Director of Finance, Resources and Business Improvement stated that any proposed increase in staff pay would be carried forward each year as part of the Council’s budget.

In response to questions, the Director of Finance, Resources and Business Improvement stated that the Communities, Housing and Environment Policy Advisory Committee would be presented with a progress report on the Affordable Homes Scheme in the near future. The report would provide greater detail on the subsidy required per unit, and the scheme’s finances generally. If the funding from the Funding Guarantee for the Affordable Homes Programme was reduced, the Executive would need to consider generating additional savings to ensure that the Council had a sustainable budget.

In response to further questions, the Director of Finance, Resources and Business Improvement stated that in achieving a balanced budget, the Council included growth in business rates above the baseline figure, as it was known that there would be an increase in the business rates above this level. The projected £20,000 green travel saving was deliverable as the number of travel claims had reduced given home working.

The Committee expressed support for the proposed MTFS and Savings proposals 2023/24 as detailed in the report.

RESOLVED:

That the following be noted:

1.  The proposed revenue budget proposals for services within the remit of the other Policy Advisory Committees as set out in Appendix B to the report;

The Executive be recommended to

1.  Approve the revenue budget proposals as set out in Appendix A to the report; and

2.  Approve an hourly rate of £258 for legal services.