Agenda item

(Cabinet Member with Special Responsibility Councillor Langhorn)

 

Report of the Deputy Chief Executive and Head of Financial Services (to follow)

(Cabinet Member with Special Responsibility Councillor Langhorn)

 

Cabinet received a report from the Head of Financial Services with regard to the latest position following Council’s consideration of the Budget and Policy Framework at its meeting held on 02 February, and to make recommendations back to Council in order to complete the budget setting process for 2011/12.

 

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

 

Cabinet was requested to finalise its preferred revenue budget and capital programme proposals for referral on to Council, using the latest information as set out in the report attached to the agenda.

 

Revenue Budget

As Council had now determined the City Council Tax Rate for 2011/12, there were no options to change the total net revenue budget for next year (recommended at £21.481M) but Cabinet now needed to put forward detailed budget proposals that added back to that amount.  Detailed options would be dependent very much on Members’ views on spending priorities.  The Head of Financial Services (as s151 Officer) advised that emphasis should be very much on achieving recurring reductions to the revenue budget.

 

Capital Programme

Cabinet might adjust its capital investment and financing proposals to reflect spending commitments and priorities but overall its proposals for 2010/11 and 2011/12 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. Setting a balanced capital programme was an iterative process, essentially balancing service delivery impact and aspirations against what the Council could afford.  The programme attached to the report represented the outcome of the work undertaken to date.

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

 

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

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

 

Future Years’ Council Tax Targets

It was felt that there was little scope for increasing Council Tax increases targets above 2.5% for 2012/13 and beyond, assuming that the Council wishes to avoid any form of challenge.  In considering any lower target, Members should have regard to the impact on service delivery, the capacity to make savings or to provide for growth, and the impact on subsequent years – as well as the implications for tax payers.

 

Housing Revenue Account Budget

The extent to which Cabinet’s earlier decision on housing rents had bearing on the debate and outcome of Council needed careful consideration.  Outline options for resolving the HRA position were set out below.

 

Option 1:  To retain existing Revenue Budget proposals and refer them back to Council.

As previously reported, this supported the continuing need for the Council to maintain and invest in its housing stock and therefore represented the best position financially, to help sustain a good quality housing service. 

 

Option 2: To consider changes to the Revenue Budget proposals for referral back to Council.

Given that decisions have already been taken on rent levels, balances, and the capital programme and its financing, the only other straightforward option would be for Cabinet to consider changing specific aspects of the budget, such as repairs and maintenance or management costs.  No specific proposals had been identified at this time, however, and therefore depending on the nature of what Cabinet might consider, it was likely that Officers would need more time to undertake a full assessment.

 

Some proposals might prove very challenging to implement from 01 April.  Whilst a later implementation could be assumed, there might be workload implications and also the timing would need to be factored into any updates to Cabinet’s HRA budget proposals.

 

OFFICER PREFERRED OPTION AND COMMENTS

 

For General Fund, proposals to be put forward by Cabinet should fit with any external constraints and the budgetary framework already approved.  The recommendations as set out met these requirements; the detailed supporting budget proposals were then a matter for Members.

 

For future Council Tax targets, both the Chief Executive and the s151 Officer would still advise against planning for a general Council Tax increase outside of the range of say 0 to 2.5%.

 

Regarding the HRA, Option 1 remained the Officer preferred option. 

 

The report outlined the actions required to complete the budget setting process for 2011/12 and to establish the key financial targets and constraints, to inform the financial planning framework for future years.

 

The meeting adjourned at 2pm during consideration of this item and reconvened at 2.05pm.  Councillor Barry left the meeting at 2.25pm.

 

Members agreed to vote on recommendation 1, followed by voting on recommendations 2 to 9 together, with a further vote on recommendation 10.

 

Councillor Langhorn proposed, seconded by Councillor Kerr:-

 

“That recommendation (1), as outlined in the report, be approved.”

 

By way of amendment, Councillor Robinson proposed:-

 

“That after ‘and:’ the following be inserted: ‘whilst not recommending specific changes to the budget proposals for 2011/12 at this time, Cabinet will review capital investment priorities related to housing activity in order to progress housing regeneration schemes; to update the MTFS and, in particular, to enable the Housing and Regeneration portfolio holders to develop proposals before the 2012/13 budget process.”

 

However it was noted that there was no seconder to the proposal and it was therefore declared lost.

 

Councillors then voted on recommendation (1):-

 

Resolved:

 

(6 Members (Councillors Ashworth, Blamire, Bryning, Kerr, Langhorn and Whitelegg) voted in favour, and 1 Member (Councillor Robinson) abstained.)

 

(1)        That Cabinet notes the inclusion of housing regeneration in the Council’s corporate priorities and:

-        makes no changes to its budget proposals for 2011/12 but draws on existing housing related activity to inform development of the draft Corporate Plan;

-        requests the Regeneration and Housing Portfolio Holders to work jointly on proposals for consideration as part of the 2012/13 budget exercise, taking into account affordability and the Council’s financial prospects.

 

Members then considered recommendations 2 to 9.

 

Councillor Langhorn proposed, seconded by Councillor Kerr:

 

“That recommendations 2 to 9, as set out in the report, be approved.”

 

By way of an amendment to recommendation (3), which was accepted as a friendly amendment by the proposer and seconder of the proposition, Councillor Bryning proposed:

 

“That the Access for the Disabled (removal of non-statutory element) be removed as a specific savings proposal for services not linked to draft priorities in respect of the Regeneration and Policy Service.”

 

By way of a further amendment to recommendation (3), which was accepted as a friendly amendment, Councillor Blamire proposed:

 

“That the sum of £300 be allocated as a growth proposal for refreshments for the annual Holocaust Day memorial event.”

 

By way of an amendment to recommendation (6), which was not accepted as a friendly amendment, Councillor Robinson proposed:

 

“That the Council Tax target increase of ‘no more than 2%’ for years 2012/13 and 2013/14 be replaced by ‘2.5%.”

 

However it was noted that there was no seconder to the proposal and it was therefore declared lost.

 

By way of an amendment to recommendation (7) it was proposed by Councillor Robinson and seconded by Councillor Whitelegg:

 

“That Housing Regeneration be added to the Capital Investment Priorities.”

 

Councillors then voted on the amendment.

 

2 Members (Councillors Robinson and Whitelegg) voted in favour of the amendment and 5 Members against (Councillors Ashworth, Blamire, Bryning, Kerr and Langhorn) whereupon the Chairman declared the amendment to be lost.

 

By way of an amendment to recommendation (8) it was proposed by Councillor Robinson and seconded by Councillor Bryning:

 

“That funds from the capital programme be earmarked to provide additional car parking space at the former play area in Parliament Street, Morecambe.”

 

Councillors then voted on the amendment.

 

1 Member (Councillor Robinson) voted in favour of the amendment, 4 Members against (Councillors Ashworth, Kerr, Langhorn and Whitelegg) and 2 Members abtained (Councillors Blamire and Bryning) whereupon the chairman declared the amendment to be lost.

 

At this point it was agreed to vote on recommendations 7 and 8 separately.

 

By way of a further amendment to recommendation (3) Councillor Whitelegg proposed and Councillor Blamire seconded:

 

“That the establishment of Lord Mayoralty be removed as a growth proposal.”

 

Councillors then voted on the amendment:

 

3 Members (Councillors Blaimire, Robinson and Whitelegg) voted in favour of the amendment and 4 Members against (Councillors Ashworth, Bryning, Kerr and Langhorn) whereupon the Chairman declared the amendment to be lost.

 

Councillors then voted on recommendations 2 to 6 and 9, as amended:

 

Resolved:

 

(6 Members (Councillors Ashworth, Blamire, Bryning, Kerr, Langhorn and Whitelegg) voted in favour, and 1 Member (Councillor Robinson) abstained.)

 

(2)     That Council be recommended to approve the General Fund Revenue Budget at £21.481M for 2011/12, excluding parish precepts.

 

(3)    That Cabinet approves the budget proposals summarised at Appendices B and C for referral on to Council, subject to any changes in relation to items included elsewhere on the agenda and revised to reflect:

• the removal of the specific savings proposal for Access for the Disabled (removal of non-statutory element) within services not linked to draft priorities in respect of the Regeneration and Policy Service.
• Allocation of the sum of £300 as a growth proposal for refreshments for the annual Holocaust Day memorial event.

 

(4)     That Cabinet approves the policy on provisions and reserves as included at Appendix D, for referral on to Council.

 

(5)     That Cabinet notes the final Local Government Settlement and the position regarding the estimated Collection Fund balance.

 

(6)   That Cabinet recommends a Council Tax target increase of no more than 2% for years 2012/13 and 2013/14, for incorporation into the draft Medium Term Financial Strategy.

 

(9)     That the associated Prudential Indicators at Appendix G be referred on to Council for approval.

 

Councillors then voted on recommendations 7 and 8.

 

Resolved:

 

(5 Members (Councillors Ashworth, Blamire, Bryning, Kerr and Langhorn) voted in favour, 1 Member (Councillor Whitelegg) against and 1 Member (Councillor Robinson) abstained.)

 

(7)  That Cabinet approves the draft Capital Investment Priorities for 2012/13 onwards included at Appendix E, for incorporation into the draft Medium Term Financial Strategy.

 

(8)  That in line with recommendation (7) above, Cabinet approves the Capital Programme as set out at Appendix F for referral on to Council.

 

Councillor Kerr proposed, seconded by Councillor Langhorn:

 

“That recommendation 10, as set out in the report, be approved.“

 

Councillors then voted on recommendation 10.

 

Resolved unanimously:

 

(10)      That the Housing Revenue Account budgets as set out at Appendix H be referred back to Council for approval.

 

 

Officers responsible for effecting the decision:

 

Head of Financial Services

 

 

Reasons for making the decision:

 

The decisions enable Cabinet to make recommendations back to Council in order to complete the budget setting process for 2010/11. The report outlined the actions required to complete the budget setting process for 2010/11 and to set the financial planning framework for future years.