Agenda item

Councillors noted that the Council had agreed the 2023-24 budget in February 2023 with a £3.3m shortfall requiring further work to remove this gap, with the fallback position being the deployment of usable reserves.

The delayed audit of the 2020-21 accounts had identified errors relating to accounting for COVID grants and the Collection Fund, which took place in 2021. These were both sums which were due to be repaid to the Government in 2021-22 rather than sums which were available for use by the Council.

The impact of this was that the level of usable reserves was approximately £20m less than had been thought when the 2023-24 budget was set in February 2023.

The budget outturn position for 2022-23 had shown an overspend of £6.4m on the General Fund and this had therefore further reduced the sums available to the Council.

An updated MTFP position had been presented to the Council at its meeting on 25 July 2023, which had set out the key issues and the position in which the Council was now left. In summary, this was a remaining in-year deficit of £1.7m and a budget gap of £18.3m over the MTFP period to 2026-27.

The report had therefore concluded that the Council was facing a potential s114 report if actions were not agreed to bring this situation back in to balance. The deadline set for this was October 2023 and the progress to date was addressed within the report now before the Council.

The Interim s151 Officer had concluded that sufficient progress had been made to avoid the need for a s114 report to be issued at this point, but that significant work was still required to produce a balanced budget for 2024-25 and beyond.

The Council noted that the report had also been considered by the Executive at its meeting on 5 October 2023.  The Executive had endorsed the recommendations therein. 

TheLead Councillor for Finance & Property, Councillor Richard Lucas, proposed a motion to endorse the second issue of the Financial Recovery Plan, which was seconded by the Leader of the Council, Councillor Julia McShane.

During the debate, councillors raised a number of issues including:

·      Absence within the report of a schedule of all current spending for the rest of this year which would have given all members the opportunity of scrutinising spending that was still proposed and suggesting alternative or further savings.

·      Insufficient detail on savings generated, and overly optimistic estimate of car park revenue.

·      Concern regarding the withdrawal of grants to parish councils, and the proposal to charge parish councils for emptying rubbish bins.

·      Concern that there had been an unfulfilled commitment made in February 2023 to bring a revised budget before Council for scrutiny and adoption, instead of which the Council has only received a high-level update report for endorsement.

·      Concern over absence of councillor involvement in the decisions taken by the Financial Control Panel.

·      Lack of public consultation

·      Communications had reported positively on the progress which had been made with the Financial Recovery Plan, whilst noting that there was still a great deal of hard work to be done. 

Having considered the motion, the Council

RESOLVED: That the Council endorses the second issue of the Financial Recovery Plan as set out in Appendix 1 to the report submitted to the Council.

Reason:

To enable the Council to protect the current level of reserves and to set a balanced budget and a robust Medium-Term Financial Plan.