Decision details

Draft Budget and Medium Term Financial Strategy 2019-2020

Decision Maker: Cabinet

Decision status: Recommendations Approved

Is Key decision?: Yes

Is subject to call in?: Yes

Purpose:

To approve the Draft Budget and Medium Term Financial Strategy 2019-2020 – 2020-2021.

Decision:

1. That it be approved that the Budget Reduction and Income Generation proposals amounting to £695,000 in 2019-2020 proceed to the formal consultation and scrutiny stages of the budget process.

2. That it be approved that Financial Transactions and Base Budget Revisions totalling a net reduction of £4.7 million in 2019-2020 be incorporated into the 2019-2020 draft budget.

3. That authority be delegated to the responsible Director and the Director of Finance to implement Financial Transactions and Base Budget Revisions at the earliest opportunity where the proposal is not reliant on the outcome of formal budget consultation.

4. That authority be delegated to the Cabinet Member for Resources, in consultation with the Director of Finance, to approve the final budget consultation arrangements.

5. That it be approved that further options are explored between October 2018 and January 2019 to address the updated projected budget deficit of in the region of £6.0 million for 2019-2020 based on the Council’s high-level strategy.

6. That it be noted that, due to the uncertainty and increasing pressures over the medium term, the overall level of risk associated with the Draft Budget and Medium Term Financial Strategy (MTFS) 2018-2019 to 2019-2020 is assessed as Red for the first time since February 2016.

7. That it be noted that the updated projected deficit assumes the achievement of budget reduction and income generation proposals amounting to £28.3 million over the two-year period from 2018-2019 to 2019-2020. Over the eight financial years the Council has identified budget reductions in excess of £220.0 million. This continues to be the most significant financial challenge that the Council has ever faced.

8. That it be noted that the successful recovery of overpaid VAT has been granted at £1.8 million, approximately £200,000 lower than anticipated in the July 2018 report to Cabinet.

9. That it be noted that, due to external factors, budget assumptions remain subject to change. This could therefore result in alterations to the financial position faced by the Council.

10. That it be noted that there continues to be a considerable amount of uncertainty with regards to future funding streams for local authorities particularly with regarding 2020-2021 onwards. The Comprehensive Spending Review 2020, the Fair Funding Review and potential pressures arising as a result of new responsibilities will impact upon the Council’s budget. At the point that further information is known it will be incorporated into future reports to Councillors.

11. That it be noted that the Council’s General Fund Balance remains at £10.0 million; the minimum balance as determined in the Council’s approved Reserves and Balances Policy. Emphasis therefore continues to be placed on identifying budget reductions and income generation proposals to meet the projected budget deficit over the medium term.

12. That it be noted that the 2019-2020 budget timetable will, as in previous years, include an update on all budget assumptions and the Provisional Local Government Settlement which will be presented to Cabinet in January 2019, with the final budget report due to be approved by Full Council in March 2019.

13. That it be noted that the HR implications as outlined in the report and that reductions in employee numbers will be achieved in line with the Council's HR policies.

Report author: Mohammed Hasan

Publication date: 18/10/2018

Date of decision: 17/10/2018

Decided at meeting: 17/10/2018 - Cabinet

Effective from: 25/10/2018

Accompanying Documents: