Issue - meetings

(Cabinet Member with Special Responsibility Councillor Bryning)

Report of the Head of Resources

(Cabinet Member with Special Responsibility Councillor Bryning)

Cabinet received a report from the Head of Resources which provided an update on the Council’s financial prospects for future years in order to help inform development of its budget strategy. 

The report was primarily for information and for seeking direction from Cabinet and other than for council tax, no specific options were put forward at this time. 

The options regarding council tax targets were basically to either:

-        reduce the existing council tax target to no more than 2% for future years; or

-        recommend alternative council tax target increases for future years; or

-        delay making recommendations at this stage, until later in the budget process.

The level of any net savings requirement (and the associated risks) would depend on the tax level proposed.  Clearly the compensation arrangements in support of a council tax freeze required specific consideration.

The main risks attached to any option follow on from the information in the report and the ability of the Council to take decisions on matching service levels with the money available to fund them.  The impact on council tax payers was key; the reputation and public perception of the Council might well be affected.  The key risks could be summarised as follows:

-          Actual savings targets prove to be substantially different from those shown, due to changes in financial projections.

-          Required savings targets can’t be met, without having an unacceptable impact on service delivery – either from the Council’s own viewpoint or from public perception.

-          Government / the public perceive council tax levels to be too high, resulting in capping action being taken against the Council and/or a negative impact on public relations and the Council’s reputation.

-          Council tax targets are too low, resulting in them being unsustainable in the longer term, without having adverse effects on future service delivery and/or the Council’s financial standing and reputation.

To counter these risks, there would be further opportunities to review target increases later during the budget process.

Planning the Council’s finances continued to be very challenging, especially given all the uncertainties.  Nonetheless, it was impossible to get away from the fact that lower government funding and lower council tax increases ultimately meant that more savings were needed – with more pressure therefore to reduce service provision.  Redirection of resources would be needed to support any new growth needs.

Councillor Bryning proposed, seconded by Councillor Smith:-

“(1)      That the current position regarding current spending and forecasts for future years be noted, together with associated risks and uncertainties.

(2)        That the Government’s proposed council tax threshold of 2% for 2013/14 be noted, and that any recommendations of any formal changes to council tax targets be reconsidered in December when more information should be available.

(3)        That Cabinet notes the work underway in developing the budget but also commissions officers to bring forward such budget options that would address a reduction of up to 10% in future government funding.

(4)        That the key  ...  view the full minutes text for item 74