Agenda item

(Cabinet Member with Special Responsibility Councillor Thomas)

 

Joint report of the Corporate Director (Finance and Performance) and Head of Financial Services to follow. 

(Cabinet Member with Special Responsibility Councillor Thomas)

 

(It was noted that Mr T Hamilton-Cox, had spoken to this item at the start of the meeting in accordance with the City Council’s agreed procedure for public speaking at Cabinet.)

 

The Corporate Director (Finance and Performance) and Head of Financial Services submitted a joint report to inform Cabinet of the latest position following Council’s consideration of the Budget and Policy Framework at its meeting held on 3 February, and to make recommendations back to Council in order to complete the budget setting process for 2010/11.

 

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

 

Corporate Plan and Priorities

Cabinet has the option of updating the proposed priorities to take account of the consultation and other information.  In doing so, the impact and scope for any redirection of resources must be considered, particularly should any major changes be proposed.

 

Funding Assumptions and Achieving a Balanced Capital Programme

The broad options for achieving a balanced programme are set out below and are very much dependent on Members’ views on spending priorities.  As such, a full options appraisal and risk assessment cannot be completed until budget proposals are known in more detail.  That said, the basic options for achieving savings include:

-            removing schemes from the draft programme, taking account of service needs and priorities;

-            reducing proposed net expenditure on schemes, where possible;

-            generating or allocation additional capital resources (e.g. receipts, direct revenue financing, use of reserves or borrowing), within affordable limits;

-            deferring projects into later years – although this would not help with the overall five-year programme unless schemes were deferred until after 2014/15.

 

Should surplus resources be available, these could be used:

 

–         to repay borrowing, or to reduce the call on the revenue budget;

–         to fund new capital schemes;

–         to make provision for other anticipated liabilities.

 

As referred to in earlier reports, setting a balanced capital programme is an iterative process, essentially balancing service delivery impact and aspirations against what the Council can (and is prepared to) afford.  The programme attached represents the outcome of the work undertaken to date.

 

In deciding the way forward, Cabinet is asked also to take into account the relevant basic principles of the Prudential Code, which are:

 

-          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.

 

      Revenue Budget

As Council has now determined the City Council Tax Rate for 2010/11, there are no options to change the total net revenue budget for next year (recommended at £24.740M) but Cabinet now needs 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 and as such, a full options analysis could only be undertaken once any alternative proposals are known and it should be noted that Officers may require more time in order to do this.  The Head of Financial Services (as s151 Officer) would advise as strongly as possible that emphasis should be very much on achieving recurring reductions to the revenue budget, and avoiding any “unidentified” savings targets that undermine the robustness of the budget and financial planning arrangements generally.

 

With regard to the use of any surplus balances (such as the £9K currently identified), Cabinet could put forward alternative arrangements for their use, bearing in mind that these are one-off resources.

 

Future Years’ Council Tax Targets

In terms of target Council Tax increases for future years and Government’s position on capping, it is felt that there is little scope for increasing targets much above the 3.75% approved for next year.   Current and prospective Governments have made it very clear regarding their future expectations for low increases and this should be taken into account.  In considering any lower target, Members should have regard to the impact on service delivery, the need (and capacity) to make savings or to provide for growth, and the impact on subsequent years – as well as the implications for tax payers.

 

Officer preferred option and comments

The recommendations as set out are in line with Officer recommendations.

 

Recommendations put forward by Cabinet should fit with any external constraints and the budgetary framework already approved.  The recommendations as set out meet these requirements; the detailed supporting budget proposals are then a matter for Members.

 

It was moved by Councillor Langhorn and seconded by Councillor Kerr:-

 

“(1)      That Cabinet notes the information and feedback from consultees and other sources regarding its draft corporate priorities and approves the 4 priorities included in Appendix A of the report, as the basis for drafting the 2010/11 Corporate Plan.

 

(2)        That the 2010/11 draft Corporate Plan be considered further at Cabinet’s March meeting prior to referral on to Council in April.”

 

Councillor Langhorn then moved, seconded by Cllr Kerr:-

 

“(3)       That the 2009/10 revised budget of £24.046M be referred on to Council for approval, with the net overspending of £47K being met from balances.

 

(4)               That Cabinet approves the policy on provisions and reserves as included at Appendix B of the report, as updated for Cabinet’s final budget proposals.

 

(5)               That Cabinet notes the position regarding estimated Collection Fund surpluses.

 

(6)               That Council be recommended to approve the General Fund Revenue Budget at £24.740M for 2010/11, excluding parish precepts.

 

(7)               That Cabinet approves the budget proposals summarised at Appendix E of the report, to ensure a balanced revenue budget for 2010/11, and for referral on to Council for approval.

 

(8)               That Cabinet agrees an annual increase in Council Tax of 3.75% for years 2011/12 and 2012/13 for inclusion in the medium term financial strategy.

 

(9)               That Cabinet approves the Capital Investment Priorities for 2010/11 onwards, included at Appendix G (Section 3) of the report.

 

(10)           That the Renewals Reserve be used to finance any shortfall in funding over the period of the capital programme subject to no new significant commitments being added to the draft programme.

 

(11)           That in line with recommendation (9) above, Cabinet approves the Capital Programme, as set out in Appendix H of the report and that this be referred on to Council for approval.

 

(12)           That the associated Prudential Indicators in Appendix I of the report be updated accordingly and be referred on to Council for approval.

 

(13)           That the Medium Term Financial Strategy, covering both revenue and capital investment, be updated in line with Cabinet’s budget proposals and be referred on to Council for approval.”

 

By way of amendment to (7), Councillor Barry proposed and Councillor Fletcher seconded:

 

“That the refuse vehicle tracking system £111,000 be removed from next years budget, spending £20,000 on reversing funding cuts to the Dukes in 2010/11 and putting the remaining £91,000 into reserves for future years funding and that the £12,000 revenue cost for the refuse vehicle tracking system in 2011/2012 and the £12,000 revenue cost in 2012/13 be used to fund the Dukes in those two years.”

 

(At this point in the meeting, Councillors Ashworth and Blamire declared personal and prejudicial interests as Members of the Board of the Dukes and left the meeting prior to consideration of the rest of this item. Councillor Langhorn declared a personal interest in DT3 in view of his son’s attendance at DT3.)

 

Members then requested a separate vote on the two proposals contained within the amendment. To allow this, Councillor Barry, with the consent of his seconder and of the meeting, revised his amendment accordingly:-

 

“(1)      That the costs for the refuse vehicle tracking system be removed from the budget and funds put back into balances 2010/11.

 

(2)        That £20,000 be granted to the Dukes for 2010/11 and £12,000 granted each year for 2011/12 and 2012/13.”

 

Members then voted on part (1) of the amendment:-

 

Resolved:

 

(5 Members (Councillors Archer, Barry, Fletcher, Mace and Thomas) voted in favour, 1 Member (Councillor Langhorn) voted against and 1 Member (Councillor Kerr) abstained)

 

(1)        That the costs for the refuse vehicle tracking system be removed from the budget and funds put back into balances in 2010/11.

 

Upon a vote being taken on part (2) of the amendment, 3 Members voted for the proposal (Councillors Barry, Fletcher and Thomas) and 4 Members voted against (Councillor Archer, Kerr, Langhorn and Mace) whereupon the Chairman declared the proposal in part (2) of the amendment lost.

 

(Councillors Ashworth and Blamire rejoined the meeting at this point.)

 

Members voted on the substantive motion, as amended, as follows:-

 

Resolved:

 

(8 Members (Councillors Archer, Ashworth, Barry, Blamire, Fletcher, Kerr, Langhorn and Thomas) voted in favour and 1 Member (Councillor Mace) abstained)

 

(1)        That Cabinet notes the information and feedback from consultees and other sources regarding its draft corporate priorities and approves the 4 priorities included in Appendix A of the report, as the basis for drafting the 2010/11 Corporate Plan.

 

(2)        That the 2010/11 draft Corporate Plan be considered further at Cabinet’s March meeting prior to referral on to Council in April.”

 

Resolved:

 

(5 Members (Councillors Archer, Ashworth, Kerr, Langhorn and Thomas) voted in favour and 4 Members (Councillors Barry, Blamire, Fletcher and Mace) abstained)

 

(3)               That the 2009/10 revised budget of £24.046M be referred on to Council for approval, with the net overspending of £47K being met from balances.

 

(4)               That Cabinet approves the policy on provisions and reserves as included at Appendix B of the report, as updated for Cabinet’s final budget proposals.

 

(5)               That Cabinet notes the position regarding estimated Collection Fund surpluses.

 

(6)               That Council be recommended to approve the General Fund Revenue Budget at £24.740M for 2010/11, excluding parish precepts.

 

(7)               That Cabinet approves the budget proposals summarised at Appendix E of the report, as amended, to ensure a balanced revenue budget for 2010/11, and for referral on to Council for approval.

 

(8)               That Cabinet agrees an annual increase in Council Tax of 3.75% for years 2011/12 and 2012/13 for inclusion in the medium term financial strategy.

 

(9)               That Cabinet approves the Capital Investment Priorities for 2010/11 onwards, included at Appendix G (Section 3) of the report.

 

(10)           That the Renewals Reserve be used to finance any shortfall in funding over the period of the capital programme subject to no new significant commitments being added to the draft programme.

 

(11)           That in line with recommendation (9) above, Cabinet approves the Capital Programme, as set out in Appendix H of the report and that this be referred on to Council for approval.

 

(12)           That the associated Prudential Indicators in Appendix I of the report be updated accordingly and be referred on to Council for approval.

 

(13)             That the Medium Term Financial Strategy, covering both revenue and capital investment, be updated in line with Cabinet’s budget proposals and be referred on to Council for approval.

 

Officers responsible for effecting the decision:

 

Corporate Director (Finance and Performance)

Head of Financial Services

 

Reasons for making the decision:

 

The decisions taken by Cabinet are necessary at this stage to take forward the budget setting process for 2010/11 to full Council and set the financial planning framework for future years. The budget proposals are consistent with delivering the Council’s corporate priorities.