Agenda item

The Director of Finance, Resources and Business Improvement introduced his report setting out budget proposals for services within the remit of the Committee.  It was noted that:

·  When the Committee last considered budget matters in November 2022, the Council had been faced with a budget gap of £2.5 million in 2023/24, mainly due to the impact of inflation on the Council’s costs, with a steadily increasing budget gap in subsequent years.

·  Since then, savings proposals totalling £1.1 million for 2023/24 had been developed across the Council and there had also been positive news arising out of Government announcements.

·  In the Chancellor’s Autumn Statement 2022 the Council Tax referendum limit was increased from 2% to 3% so if the Council agreed to a 3% Council Tax increase, this would raise more money.  Business rates would also be frozen in 2023/24, but Councils would be compensated for the loss of income arising. 

·  Whilst the longer-term position remained challenging, these recent developments had had a positive impact, such that it was now anticipated that the Council would be able to set a balanced budget for 2023/24, provided that the savings proposals were adopted, and Council Tax was increased up to the referendum threshold.

·  In the Local Government Finance Settlement 2023/24, there were changes to the one-off funding received by the Council, predominantly New Homes Bonus (NHB).  This did not affect the proposals set out in the report because the Council had always treated NHB as one-off funding, not part of the revenue budget.  Although the Government was reducing NHB in 2023/24, this was broadly compensated for by a new one-off Funding Guarantee.

·  Three revenue budget proposals had been identified in respect of the services falling within the remit of the Committee: the funding of Economic Development in future, new income arising from the re-opening of the Mote Park Café and a reduction in income from the Market.

·  In terms of the Capital Programme schemes falling within the remit of the Committee, the major change was that the proposal in relation to the Leisure Centre was now £7 million over five years which would fund the practical improvements discussed at the last meeting rather than a replacement facility within the Five-Year plan.  However, this did not mean that there would not be further capital expenditure in the future.

In response to questions:

Mote Park Café

The Lead Member for Leisure and Arts explained that, in terms of achieving income targets in respect of the Café, the operator was fitting out the kitchen and the work was nearing completion which would enable the facility to re-open.

One-off Funding Guarantee

The Leader of the Council confirmed that choices would need to be made about the use of the one-off Funding Guarantee considering the plans in relation to the 1,000 Affordable Homes Programme and demands in relation to the staff budget.

Business Rates Pool

The Leader of the Council confirmed that there was potential for growth in Business Rates income with the business park at junction 8 off the M20 and the Yalding enterprise park coming forward.

Market Income

The Lead Member for Leisure and Arts explained that it was proposed that there be a reduction in market charges to encourage the take-up of pitches.  This would be accompanied by a marketing strategy to increase footfall.

Leisure Centre

The Lead Member for Leisure and Arts explained that it would be necessary for the Council to borrow to fund a new Leisure Centre and pay for that borrowing.  The budget strategy was based on the fact that now was not the best time to be borrowing capital for a facility such as a Leisure Centre.  However, provision was made in the Five-Year Plan for improvements as it was recognised that the building was ageing.  It was hoped that 2027/28 would be the optimum time to build a new facility and work was continuing in the background on the location, design and facilities to be included.  Further details would be provided in the report to the next meeting.  The aim was to develop a proposal that would be ready to commence if funding became available.

The Director of Finance, Resources and Business Improvement explained that the Capital Programme was updated every year so this was a fresh set of Capital Programme proposals.  Taking the funding previously proposed for leisure provision out of the Capital Programme allowed more capacity for the 1,000 Affordable Homes Programme because it was known that the costs of construction were increasing.

The Leader of the Council reiterated that the resources previously proposed for leisure provision had never existed in cash terms.  It was always an intention to borrow and not borrowing for the Leisure Centre made it easier to borrow for the 1,000 Affordable Homes Programme.

RESOLVED TO RECOMMEND TO THE EXECUTIVE:

1.  That the revenue budget proposals set out in Appendix A to the report of the Director of Finance, Resources and Business Improvement be approved.

2.  That the capital budget proposals set out in Appendix B to the report of the Director of Finance, Resources and Business Improvement be approved.