Agenda item

Decision:

(1)   That the budget assumptions used in the preparation of the 2022-23 draft budget and three year forward projections be approved.

(2)   That the current position on the draft budget for 2022-23 and the budget shortfall anticipated over the three years to 2024-25, be noted.

(3)   That the savings identified as part of the savings strategy for 2022-23 through to 2025-26 (Sections 11,12,13 of, and Appendix 3 to, the report submitted to the Executive) which have been included in the draft budget, be approved.

(4)   That the in-year savings of £46,750 arising from the review of classical music, book festival, voluntary and CAB grants for 2021-22, which were not included as part of the 2021-22 budget, be approved.

(5)   That the additional growth items identified in section 11 and Appendix 3 which have been included in the draft budget, be approved.

(6)   That the proposal to Council to make the contributions to/from the Council’s various earmarked reserves for specific purposes as set out in section 9 of the report as part of the budget report in February 2022, be approved.

Reason:

To assist the Executive in the preparation of the General Fund estimates for 2022-23.

Other options considered and rejected by the Executive:

None.

Details of any conflict of interest declared by the Leader or lead councillors and any dispensation granted:

None.

The report before the Executive outlined the position of the 2022-23 draft general fund budget and the business planning assumptions for 2022-23 to 2025-26. The final budget position would be submitted to Full Council on 9 February 2022. The Savings Strategy for 2022-23 to 2025-26, which the Executive had approved on 22 June 2021, had set out the assumptions used in calculating the budget gap and therefore the quantity of savings required over the medium term.  The core assumptions underpinning the draft budget had been reviewed and the revised assumptions were set out in the report.

In the absence of the Lead Councillor for Resources, the Leader of the Council introduced the report.  The Joint Executive Advisory Board had considered the outline budget report at its meeting on 11 November 2021 and a summary of their comments were set out on the Supplementary Information Sheet. 

The Leader highlighted the overview table in the executive summary of the report and described the inflationary underlying assumptions in the report as optimistic, pay as a result of inflation was realistic and any increase in fees and charge as under-ambitious. It was noted the assumptions for Council Tax income was accurate as Council Tax charges were constrained at below a 2% increase unless the Council called a referendum. The report included the best assumptions about the level of government funding that would be available. Anticipated rental income rises were modest. The Bank of England forecast was that inflation would fall in the coming year. The meeting heard that a 1% rise in inflation would mean a loss of £300,000 to the Council. Based on the assumptions in the report it was currently estimated there would be a budget shortfall for the forthcoming year of £1.7m and a cumulative shortfall of £5m up to 2026 but with a variance in the budget gap for the longer-term period of between minus £3m to minus £11m.

Because it was still early in the budget process, the report was clear that there were areas of uncertainty that would influence the final position.

Until the local government finance settlement was announced it was uncertain if the Government would proceed with recompensing local authorities for the planned rise in National Insurance contributions as had been stated. The cost of the increase would amount to a figure in the region of £300,000 and had been included in the assumptions until the offset was confirmed.

The report and the work of finance officers was commended and the Executive,

RESOLVED:

(1)   That the budget assumptions used in the preparation of the 2022-23 draft budget and three year forward projections be approved.

(2)   That the current position on the draft budget for 2022-23 and the budget shortfall anticipated over the three years to 2024-25, be noted.

(3)   That the savings identified as part of the savings strategy for 2022-23 through to 2025-26 (Sections 11,12,13 of, and Appendix 3 to, the report submitted to the Executive) which have been included in the draft budget, be approved.

(4)   That the in-year savings of £46,750 arising from the review of classical music, book festival, voluntary and CAB grants for 2021-22, which were not included as part of the 2021-22 budget, be approved.

(5)   That the additional growth items identified in section 11 and Appendix 3 which have been included in the draft budget, be approved.

(6)   That the proposal to Council to make the contributions to/from the Council’s various earmarked reserves for specific purposes as set out in section 9 of the report as part of the budget report in February 2022, be approved.

Reason:

To assist the Executive in the preparation of the General Fund estimates for 2022-23.