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COMMUNITIES, LEISURE AND ARTS POLICY ADVISORY COMMITTEE

 

5 September 2023

 

Medium Term Financial Strategy and Budget Proposals

 

Timetable

Meeting

Date

Communities, Leisure and Arts Policy Advisory Committee

5 September 2023

Cabinet

20 September 2023

Will this be a Key Decision?

 

Yes

 

Urgency

Not Applicable

Final Decision-Maker

Council

Lead Head of Service

Mark Green, Director of Finance, Resources and Business Improvement

Lead Officer and Report Author

Adrian Lovegrove, Head of Finance

Classification

Public

Wards affected

All

 

Executive Summary


This report forms part of the process of agreeing a budget for 2024/25 and setting

next yearís Council Tax. The report sets out a draft Medium Term Finance Strategy for 2024/25 Ė 2028/29 and budget proposals for services within the remit of the

Committee. These proposals will then be considered by the Cabinet at its meeting

on 20 September 2023.

 

The Cabinet will subsequently consider any remaining budget issues at its meeting on 7 February 2024, with a view to determining a final set of proposals for submission to Council on 21 February 2024.

 

Purpose of Report

 

Recommendation to Cabinet

 

 

This report makes the following recommendation to the Committee:†

 

That the Cabinet be recommended to:

 

1.     Approve the draft Medium Term Financial Strategy for 2024/25 to 2028/29 set out in Appendix A to the report.

2.   †Approve the budget proposals set out in Appendix B to the report.

 



Medium Term Financial Strategy and Budget Proposals

 

1.       CROSS-CUTTING ISSUES AND IMPLICATIONS

 

 

Issue

Implications

Sign-off

Impact on Corporate Priorities

The Medium Term Financial Strategy and the budget are a re-statement in financial terms of the priorities set out in the strategic plan. They reflect the Councilís decisions on the allocation of resources to all objectives of the strategic plan.

Section 151 Officer & Finance Team

Cross Cutting Objectives

The MTFS supports the cross-cutting objectives in the same way that it supports the Councilís other strategic priorities.

Section 151 Officer & Finance Team

Risk Management

This has been addressed in section 5 of the report.

Section 151 Officer & Finance Team

Financial

The budget strategy and the MTFS impact upon all activities of the Council. The future availability of resources to address specific issues is planned through this process. It is important that the committee gives consideration to the strategic financial consequences of the recommendations in this report.

Section 151 Officer & Finance Team

Staffing

The process of developing the budget strategy will identify the level of resources available for staffing over the medium term.

Section 151 Officer & Finance Team

Legal

Under Section 151 of the Local Government Act 1972 (LGA 1972) the Section 151 Officer has statutory duties in relation to the financial administration and stewardship of the authority, including securing effective arrangements for treasury management.† The legal implications are detailed within the body of the report which is compliant with statutory and legal regulations such as the CIPFA Code of Practice on Treasury Management in Local Authorities.†

The Council is required to set a council tax by the 11 March in any year and has a statutory obligation to set a balanced budget.† The budget requirements and basic amount of Council Tax must be calculated in accordance with the requirements of sections 31A and 31B to the Local Government Finance Act 1992 (as amended by sections 73-79 of the Localism Act 2011).

The Council is required to determine whether the basic amount of council tax is excessive as prescribed in regulations Ė section 52ZB of the 1992 Act as inserted under Schedule 5 to the Localism Act 2011.† The Council is required to hold a referendum of all registered electors in the borough if the prescribed requirements regarding whether the increase is excessive are met.†

Approval of the budget is a matter reserved for full Council upon recommendation by the Cabinet on budget and policy matters.

Section 151 Officer & Finance Team

Privacy and Data Protection

Privacy and Data Protection is considered as part of the development of new budget proposals.† There are no specific implications arising from this report.

 

Section 151 Officer & Finance Team

Equalities

The MFTS report scopes the possible impact of the Councilís future financial position on service delivery.† When a policy, service or function is developed, changed or reviewed, an evidence-based equalities impact assessment will be undertaken.† Should an impact be identified appropriate mitigations with be identified.

Section 151 Officer & Finance Team

Public Health

 

 

The resources to achieve the Councilís objectives are allocated through the development of the Medium Term Financial Strategy.

Section 151 Officer & Finance Team

Crime and Disorder

The resources to achieve the Councilís objectives are allocated through the development of the Medium Term Financial Strategy.

Section 151 Officer & Finance Team

Procurement

The resources to achieve the Councilís objectives are allocated through the development of the Medium Term Financial Strategy.

Section 151 Officer & Finance Team

Biodiversity and Climate Change

The resources to achieve the Councilís objectives are allocated through the development of the Medium Term Financial Strategy.

Section 151 Officer & Finance Team

 


 

2.††††† INTRODUCTION AND BACKGROUND

 

Medium Term Financial Strategy

 

2.1        The Medium Term Financial Strategy (MTFS) sets out in financial terms how the Council will deliver its Strategic Plan over the next five years. The Council adopted a Strategic Plan for the period 2021 Ė 2045 in December 2018, and the existing MTFS for the period 2023/24 to 2027/28 reflects the Strategic Plan. The new MTFS will continue to reflect the Strategic Plan priorities.

 

2.2        A draft MTFS is attached to this report as Appendix A. As background, it comprises an assessment of the economic environment and the Councilís own financial position. It will be seen that the Council faces a budget gap, given the expected impact of inflation on costs, compared with the lower projected rate of growth in Council resources.

 

Budget Savings

 

2.3        A key outcome of the process of updating the MTFS is to set a balanced budget and agree a level of council tax for 2024/25 at the Council meeting on 21 February 2024.† The draft MTFS describes how, in bridging the budget gap, the Council needs to balance the requirement to make savings or generate increased income against the key priorities set out in the Council's Strategic Plan.

 

2.4        The draft MTFS explains that all budgets are reviewed in detail to identify opportunities for savings, or increased income, which can be delivered with the minimum impact on the strategic priorities. To the extent that further growth is planned, above and beyond existing budgets, this would need to be offset by further savings.

 

2.5        The following savings for 2024/25 have been identified in the services falling within the remit of this committee and are shown in Appendix B.

 

Museum - Business rates saving - £35,000

 

A revaluation of the Museumís rating assessment has meant that the Museum no longer has to pay business rates, allowing the budget to be saved.

Strategy, Insight and Governance - Sell internal printing services externally - £5,000

 

The Council has a print room which continues to support Council committees, produce marketing material and provide a range of other services.† It is well-resourced and already carries out work for another local authority.† There is scope for further income to be generated from external customers.


 

2.6        Savings have been identified within the remit of the other Policy Advisory Committees which, all other factors remaining equal, and assuming fees and charges are increased in line with the MTFS inflation assumption, would allow the Council to set a balanced budget for 2025/26.

 

 

 

3.           AVAILABLE OPTIONS

 

3.1 ††† Agree the Medium Term Financial Strategy and the budget proposals relating to this Committee as set out in Appendices A and B respectively for onward submission to the Cabinet.

 

3.2† †† Propose changes to the budget proposals.

 

3.3††† Make no comment on the budget proposals.

 

 

4.††† PREFERRED OPTION AND REASONS FOR RECOMMENDATIONS

 

4.1†† The Cabinet must recommend to Council at its meeting on 7 February 2024 a balanced budget and a proposed level of Council Tax for the coming year. The overall strategy and the budget proposals included in this report will assist the Cabinet in doing this.† Accordingly, the preferred option is that this Committee agrees the Medium Term Financial Strategy and the budget proposals at Appendices A and B respectively for onward submission to the Cabinet.

 

 

5.††† RISK

5.1†† The Council's finances are subject to a high degree of risk and uncertainty. The draft MTFS includes an evaluation of the Councilís financial resilience, from which it can be seen that it has adequate, but not excessive, reserves and is positioned well to manage the financial challenges that it faces.

 

5.2†† In order to address risk on an ongoing basis in a structured way and to ensure that appropriate mitigations are developed, the Council has developed a budget risk register.† This seeks to capture all known budget risks and to present them in a readily comprehensible way. The budget risk register is updated regularly and is reviewed by the Audit, Governance and Standards Committee at each of its meetings.

 

 

 

 

6.††† CONSULTATION RESULTS AND PREVIOUS COMMITTEE FEEDBACK

 

6.1†† The Cabinet received an initial report on the MTFS at its meeting on 26 July 2023 and it agreed the approach set out in that report to development of an MTFS for 2024/25 - 2028/29 and a budget for 2024/25.

 

6.2†† Public consultation on the budget has been carried out, with a survey which is due to close on 28 August 2023.† Details will be circulated to members once they are available and they are encouraged to review the findings and assess whether the budget proposals are consistent with public expectations and aspirations.

 

 

7.††† NEXT STEPS: COMMUNICATION AND IMPLEMENTATION OF THE DECISION

 

7.1†† The timetable for developing the budget for 2024/25 is set out below.

 

Date

Meeting

Action

September 2023

All Policy Advisory Committees

Consider 24/25 budget proposals and draft MTFS

20 September 2023

Cabinet

Agree 24/25 budget proposals and draft MTFS

5 February 2024

Corporate Services Policy Advisory Committee

Consider final budget proposals and MTFS

7 February 2024

Cabinet

Agree final budget proposals and MTFS for recommendation to Council

21 February 2023

Council

Approve 24/25 budget

 

 

 

8. †††† REPORT APPENDICES

 

The following documents are to be published with this report and form part of the report:

         Appendix A: Draft Medium Term Financial Strategy 2024/25 Ė 2028/29

         Appendix B: Budget Proposals 2024/25

 

 

9. †††† BACKGROUND PAPERS

 

There are no background papers.