Issue - meetings

(Cabinet Members with Special Responsibility Councillors Blamire & Bryning)

Report of Head of Financial Services

(Cabinet Members with Special Responsibility Councillors Blamire & Bryning)

Cabinet received a report from the Head of Financial Services to inform Cabinet of the latest position following Council’s consideration of the Budget and Policy Framework at its meeting held on 01 February, and to make recommendations back to Council in order to complete the budget setting process for 2012/13.

The options, options analysis, including risk assessment and officer preferred option, were set out in the report as follows:

Cabinet was now requested to finalise its preferred revenue budget and capital programme proposals for referral on to Council, using the latest information available and taking account of the decisions already taken by Cabinet earlier in the meeting.

A separate updated schedule of proposals was circulated and discussed during the meeting.  In particular, specific consideration was given to managing the capital financing risks surrounding the capital programme and their potential effects.  Advice was sought from the Head of Financial Services, who outlined the provisions within existing Financial Regulations to help manage such situations.  In addition a further report on the General Fund capital position would be scheduled for April Cabinet, when there should be more clarity on timescales and resulting risks.  This would provide an opportunity to take action if needed to protect the Council’s financial position.

Revenue Budget

As Council had now determined the City Council tax rate for 2012/13, there were no options to change the total net revenue budget for next year (recommended at £20.190M) but Cabinet now needed to put forward detailed budget proposals that add back to that amount. Detailed options would be dependent very much on Members’ views on spending priorities.  Taking account of these, the Head of Financial Services (as s151 Officer) continues to advise that wherever possible, emphasis should be on achieving recurring reductions to the revenue budget.

Capital Programme

Cabinet could adjust its capital investment and financing proposals to reflect spending commitments and priorities but overall its proposals for 2011/12 and 2012/13 must balance.  Whilst there was no legal requirement to have a programme balanced over the full 5-year period, it was considered good practice to do so – or at least have clear plans in place to manage the financing position over that time.  Inevitably capital investment needs and funding opportunities would change, but it was important to consider and manage stakeholder expectations regarding investment too.

In deciding its final proposals, Cabinet was asked also to take into account the relevant basic principles of the Prudential Code, which were:

-          that the capital investment plans of local authorities are affordable, prudent and sustainable, and

-          that local strategic planning, asset management planning and proper options appraisal are supported.

Budget Framework (Reserves and Provisions / MTFS)

Given known commitments, risks and approved council tax targets there was little flexibility in financial terms, but Cabinet could consider different arrangements for approving the use of various reserves, or consider different budget strategies for future years.  On the whole, however, the current arrangements had worked  ...  view the full minutes text for item 95