Agenda item

Final Budget Report 2021-2022

[To consider and determine the Council’s budgetary provisions for the forthcoming municipal year:

 

·       Capital Programme 2020-2021 to 2024-2025 quarter three review and 2021- 2022 to 2025-2026 budget strategy

·       Treasury Management Strategy 2021-2022 

·       Final Budget and Medium-Term Financial Strategy 2021-2022 to 2023-2024

·       Council Tax Formal Resolutions.]

 

Decision:

1.      That the revised City of Wolverhampton Council Capital Strategy be approved.

2.      That the revised, medium term General Revenue account capital programme of £316.4 million, an increase of £1.6 million from the previously approved programme, and the change in associated resources be approved.

3.      That the authorised borrowing limit for 2021-2022 to support the capital strategy as required under Section 3(1) of the Local Government Act 2003 to be set at £1,166.2 million (PI3, Appendix 3 of the Cabinet report); the forecast borrowing is below the authorised borrowing limit.

4.      That the Treasury Management Strategy Statement 2021-2022 as set out in Appendix 1 of the Cabinet report be approved.

5.      That the Annual Investment Strategy 2021-2022 as set out in Appendix 2 of the Cabinet report be approved.

6.      That the Prudential and Treasury Management Indicators as set out in Appendix 3 of the Cabinet report be approved.

7.      That the Annual Minimum Revenue Provision (MRP) Statement setting out the method used to calculate MRP for 2021-2022 as set out in Appendix 4 of the Cabinet report be approved. 

8.      That the method used to calculate MRP for 2020-2021 as set out in the Annual MRP Statement approved by Council on 4 March 2020 be amended to the method as set out in Appendix 4 of the Cabinet report.

9.      That the Treasury Management Policy Statement and Treasury Management Practices as set out in Appendix 6 of the Cabinet report be approved.

10.   That authority continues to be delegated to the Director of Finance to amend the Treasury Management Policy and Practices and any corresponding changes required to the Treasury Management Strategy, the Prudential and Treasury Management Indicators, the Investment Strategy and the Annual MRP Statement to ensure they remain aligned. Any amendments would be reported to the Cabinet Member for Resources and Cabinet (Resources) Panel as appropriate.

11.   That authority continues to be delegated to the Director of Finance to lower the minimum sovereign rating in the Annual Investment Strategy, in the event of the UK’s credit rating being downgraded by the third credit rating agency, due to the unprecedented impact of Covid-19 on the economy.

12.   That the net budget requirement for 2021-2022 of £258.5 million for General Fund services (paragraph 10.1 of the Cabinet report) be approved.

13.   That the Medium Term Financial Strategy (MTFS) 2021-2022 to 2023-2024 as detailed in Table 4 and the budget preparation parameters underpinning the MTFS as detailed in Appendix 2 of the Cabinet report be approved. 

14.   That a Council Tax for Council services in 2021-2022 of £1,765.49 for a Band D property, being an increase of 4.99% on 2020-2021 levels, which incorporates the 3% increase in relation to Adult Social Care, in line with Government expectations. (paragraph 8.4, Table 1 of the Cabinet report) be approved.

15.   That work starts on developing budget reductions and income generation proposals for 2022-2023 onwards in line with the Five Year Financial Strategy (paragraph 10.5 of the Cabinet report).

16.   That revisions to the local council tax support scheme (paragraph 8.7 of the Cabinet report) be approved. 

17.   That it be noted that the Council Tax base for the year 2021-2022 is calculated at 63,580.55 (Item T in the formula in Section 31B of the Local Government Finance Act 1992, as amended (the “Act”), as reported to Cabinet on 20 January 2021.

 

18.   Calculate that the Council Tax requirement for the Council’s own purposes for 2021-2022 is £112,251,000.

 

19.   That the following amounts be calculated for the year 2021-2022 in accordance with Sections 30 to 36 of the Local Government Finance Act 1992 as amended:

 

(a)  £642,718,000       being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2) of the Act.

 

(b)  £530,467,000        being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(3) of the Act.

 

(c)    £112,251,000        being the amount by which the aggregate at 3(a) above exceeds the aggregate at 3(b) above, calculated by the Council in accordance with Section 31A(4) of the Act as its Council Tax requirement for the year. (Item R in the formula in Section 31B of the Act).

 

(d)  £1,765.49             being the amount at 3(c) above (Item R), all divided by Item T(section 1 above), calculated by the Council, in accordance with Section 31B of the Act, as the basic amount of its Council Tax for the year (including Parish precepts).

 

(d)    £0                         being the aggregate amount of all special items (Parish precepts) referred to in Section 34(1) of the Act.

 

(f)     £1,765.49             being the amount at 3(d) above less the result given by dividing the amount at 3(e) above by Item T (1(a) above), calculated by the Council, in accordance with Section 34(2) of the Act, as the basic amount of its Council Tax for the year for dwellings in those parts of its area to which no Parish precept relates

 

20.   That it be noted that West Midlands Police and Fire Authorities have issued precepts to the Council in accordance with Section 40 of the Local Government Finance Act 1992 for each category of dwellings in the Council’s area as detailed in the report.

21.   That the Council, in accordance with Sections 30 to 36 of the Local Government Finance Act 1992, hereby sets the aggregate amounts as detailed in the report as the amounts of Council Tax for 2021-2022 for each part of its area and for each of the categories of dwellings.

 

22.   That, having calculated the aggregate in each case of the amounts at (3) (f) and (4) above, the City Council, in accordance with Section 30(2) of the Local Government Finance Act 1992, hereby sets the following amounts as the amounts of the Council Tax for the year 2021-2022 for each of the categories of dwellings as detailed in the report:

 

23.   That a notice of the amounts payable in respect of chargeable dwellings in each valuation band for the year commencing on 1 April 2021 be published in at least one local newspaper and that in accordance with Section 3(2) of the Local Government Finance Act 1992, this notice shall also make reference to the National Non-Domestic Rating Multiplier set by the Secretary of State, and specify that the Council Tax and the non-domestic rate demands are annual demands which cover the full financial year.

 

24.   That the Council has determined that its relevant basic amount of Council Tax for 2021-2022 is not excessive in accordance with principles approved under Section 52ZB Local Government Finance Act 1992.

 

25.   That as the billing authority, the Council has not been notified by a major precepting authority that its relevant basic amount of Council Tax for 2021-2022 is excessive and that the billing authority is not required to hold a referendum in accordance with Section 52ZK Local Government Finance Act 1992.

 

26.That it be noted that the MRP charge for the financial year 2021-2022 would be £18.2 million; it is forecast to increase to £25.5 million in 2022-2023 (paragraph 2.14 of the Cabinet report).

27.That it be noted that Cabinet or Cabinet (Resources) Panel and Council would receive regular Treasury Management reports during 2021-2022 on performance against the key targets and Prudential and Treasury Management Indicators in the Treasury Management Strategy and Investment Strategy as set out in paragraph 2.12 and Appendices 2 and 3 of the Cabinet report.

Minutes:

Councillor Louise Miles presented the Final Budget Report 2021-2022 which encompassed the Capital Programme 2020-2021 to 2024-2025 quarter three review and 2021- 2022 to 2025-2026 budget strategy, Treasury Management Strategy 2021-2022, Final Budget and Medium-Term Financial Strategy 2021-2022 to 2023-2024, Council Tax Formal Resolutions for approval.

 

Councillor Louise Miles outlined the recommendations of the report, drawing Councillor’s attention to the challenges that the Council faced. She advised the proposed budget was balanced without the need to make significant or fundamental cuts to services.

 

Councillor Louise Miles advised that the Final Budget Report was underpinned by the Our Council Plan and Relighting our City Commitment to ensure that resources were aligned with the priorities of the Council.

 

Councillor Louise Miles advised that the Council was committed to supporting residents, children and young people, more good jobs and investment in the city and the City’s green agenda. 

 

Councillor Louise Miles advised that Council Tax would be increased by 1.99% and adult social care by 3%. She went on to outline the rationale for increasing these taxes.

 

Councillor Louise Miles thanked residents, partners and the youth Council for their support and contributions towards budget consultations.

 

Councillor Louise Miles advised that the budget set last year was affected and distorted by the impact of Covid-19. She acknowledged the funding received by central government as a result of the pandemic and provided a breakdown of the funding received and noted it was difficult to confirm the exact costs associated with Covid-19.

 

Councillor Louise Miles proposed the recommendations and the Leader of the Council, Councillor Ian Brookfield seconded the recommendations.

 

Councillor Wendy Thompson moved the following amendment to the budget:

 

1)   Change to Council Tax Rate

 

A reduction from 4.99% to 3.99% in the council tax increase; funded from the Budget Strategy Reserve at a cost of £1.069 million.

 

          At Page15 of this report:

 

At “Council Tax formal resolutions for 2021-2022” make the below changes:

 

At 2, delete: “£112,251,000” and insert: “£111,182,000.

 

At 3. (b) delete: “£530,476,000” and insert: “£531,536,000.

 

At 3. (c) delete: “£112,251,000” and insert: “£111,182,000”.

 

At 3. (d) delete “£1,765.49” and insert: “£1,748.68”.


At 3. (f) delete: “£1,765.49” and insert “£1,748.68”.

 

          At Page 16 of this report:

 

At 4. Insert: “To note that West Midlands Mayor has not issued a precept to the Council in accordance with Section 40 of the Local Government Finance Act 1992 for each category of dwellings in the Council’s area as indicated in the table below.” after “To note that West Midlands Police and Fire Authorities have issued precepts to the Council in accordance with Section 40 of the Local Government Finance Act 1992 for each category of dwellings in the Council’s area as indicated in the table below.”

 

Delete the table at 4. and insert the below:

 

 

Valuation Band

Precepting Authority

A

6/9

B

7/9

C

8/9

D

9/9

E

11/9

F

13/9

G

15/9

H

18/9

West Midlands Fire and Rescue Authority

42.02

49.03

56.03

63.04

77.04

91.05

105.06

126.07

West Midlands Police and Crime Commissioner

118.37

138.09

157.82

177.55

217.01

256.46

295.92

355.10

West Midlands Mayor

0

0

0

0

0

0

0

0

Precepts

160.39

187.12

213.85

240.59

294.05

347.51

400.98

481.17

 

Delete the table at 5. and insert the below:

 

 

Valuation band

Billing Authority

A

6/9

B

7/9

C

8/9

D

9/9

E

11/9

F

13/9

G

15/9

H

18/9

City of Wolverhampton Council

1,165.79

1,360.09

1,554.38

1,748.68

2,137.27

2,525.87

2,914.47

3,497.36

Total Billing

1,165.79

1,360.09

1,554.38

1,748.68

2,137.27

2,525.87

2,914.47

3,497.36


Delete the table at 6. and insert the below:

 

 

Valuation band

Authority

A

6/9

B

7/9

C

8/9

D

9/9

E

11/9

F

13/9

G

15/9

H

18/9

Total Precepts

160.39

187.12

213.85

240.59

294.05

347.51

400.98

481.17

Total Billing

1,165.79

1,360.09

1,554.38

1,748.68

2,137.27

2,525.87

2,914.47

3,497.36

Total Council Tax

1,326.18

1,547.21

1,768.23

1,989.27

2,431.32

2,873.38

3,315.45

3,978.53

 

2)   Creation of Children’s Social Care Reserve Fund

 

That a new specific reserve to support the Children’s Social Care Service is created from a virement from the Budget Contingency Reserve totalling £300,000.

 

3)   Transfer of Funds from City Assets and Housing Division To Regeneration  Division

 

An increase to the Regeneration Division budget by £136,000 to £6.639 million funded by a decrease of £136,000 to the City Assets and Housing Division budget to £10.312 million.

 

At page 116 of Budget Book 2021-2022, a one-year increase to the “Supplies & Services” of the Enterprise budget of £45,300 funded by a corresponding decrease to the Direct Employee Costs, Housing budget (page 42 of the Budget Book 2021-2022); generated from holding the Direct of Housing and City Assets post vacant for one year.

 

At page 117 of Budget Book 2021-2022, a one-year increase to the “Supplies & Services” of the Local Economy budget of £45,300 funded by a corresponding decrease to the Direct Employee Costs, Housing budget (page 42 of the Budget Book 2021-2022); generated from holding the Direct of Housing and City Assets post vacant for one year.

 

At page 120 of Budget Book 2021-2022, a one-year increase to the “Supplies & Services” of the Skills budget of £45,300 funded by a corresponding decrease to the Direct Employee Costs, Housing budget (page 42 of the Budget Book 2021-2022); generated from holding the Direct of Housing and City Assets post vacant for one year.

 

Councillor Wendy Thompson provided the principle speech in response to the budget report and outlined the rationale to the amendment to the budget. Councillor Udey Singh seconded the amendment to the budget.

 

The report was debated by Council.

 

In accordance with the Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014 the votes were recorded as follows:

 

The amended motion was LOST by 43 votes. There were nine votes for.

 

The amended motion was debated by Council and was lost.

 

In accordance with the Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014 the votes were recorded as follows:

 

The substantive motion was CARRIED by 43 votes. There were nine votes against.

 

Resolved:

 

1.       That the revised City of Wolverhampton Council Capital Strategy be approved.

2.       That the revised, medium term General Revenue account capital programme of £316.4 million, an increase of £1.6 million from the previously approved programme, and the change in associated resources be approved.

3.       That the authorised borrowing limit for 2021-2022 to support the capital strategy as required under Section 3(1) of the Local Government Act 2003 to be set at £1,166.2 million (PI3, Appendix 3 of the Cabinet report); the forecast borrowing was below the authorised borrowing limit.

4.       That the Treasury Management Strategy Statement 2021-2022 as set out in Appendix 1 of the Cabinet report be approved.

5.       That the Annual Investment Strategy 2021-2022 as set out in Appendix 2 of the Cabinet report be approved.

6.       That the Prudential and Treasury Management Indicators as set out in Appendix 3 of the Cabinet report be approved.

7.       That the Annual Minimum Revenue Provision (MRP) Statement setting out the method used to calculate MRP for 2021-2022 as set out in Appendix 4 of the Cabinet report be approved. 

8.       That the method used to calculate MRP for 2020-2021 as set out in the Annual MRP Statement approved by Council on 4 March 2020 be amended to the method as set out in Appendix 4 of the Cabinet report.

9.       That the Treasury Management Policy Statement and Treasury Management Practices as set out in Appendix 6 of the Cabinet report be approved.

10.   That authority continues to be delegated to the Director of Finance to amend the Treasury Management Policy and Practices and any corresponding changes required to the Treasury Management Strategy, the Prudential and Treasury Management Indicators, the Investment Strategy and the Annual MRP Statement to ensure they remain aligned. Any amendments would be reported to the Cabinet Member for Resources and Cabinet (Resources) Panel as appropriate.

11.   That authority continues to be delegated to the Director of Finance to lower the minimum sovereign rating in the Annual Investment Strategy, in the event of the UK’s credit rating being downgraded by the third credit rating agency, due to the unprecedented impact of Covid-19 on the economy.

12.   That the net budget requirement for 2021-2022 of £258.5 million for General Fund services (paragraph 10.1 of the Cabinet report) be approved.

13.   That the Medium Term Financial Strategy (MTFS) 2021-2022 to 2023-2024 as detailed in Table 4 and the budget preparation parameters underpinning the MTFS as detailed in Appendix 2 of the Cabinet report be approved. 

14.   That a Council Tax for Council services in 2021-2022 of £1,765.49 for a Band D property, being an increase of 4.99% on 2020-2021 levels, which incorporates the 3% increase in relation to Adult Social Care, in line with Government expectations. (paragraph 8.4, Table 1 of the Cabinet report) be approved.

15.   That work starts on developing budget reductions and income generation proposals for 2022-2023 onwards in line with the Five Year Financial Strategy (paragraph 10.5 of the Cabinet report).

16.   That revisions to the local council tax support scheme (paragraph 8.7 of the Cabinet report) be approved. 

17.   That it be noted that the Council Tax base for the year 2021-2022 is calculated at 63,580.55 (Item T in the formula in Section 31B of the Local Government Finance Act 1992, as amended (the “Act”), as reported to Cabinet on 20 January 2021.

 

18.   Calculate that the Council Tax requirement for the Council’s own purposes for 2021-2022 is £112,251,000.

 

19.   That the following amounts be calculated for the year 2021-2022 in accordance with Sections 30 to 36 of the Local Government Finance Act 1992 as amended:

 

(a)  £642,718,000       being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2) of the Act.

 

(b)  £530,467,000       being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(3) of the Act.

 

(c)    £112,251,000       being the amount by which the aggregate at 3(a) above exceeds the aggregate at 3(b) above, calculated by the Council in accordance with Section 31A(4) of the Act as its Council Tax requirement for the year. (Item R in the formula in Section 31B of the Act).

 

(d)  £1,765.49             being the amount at 3(c) above (Item R), all divided by Item T(section 1 above), calculated by the Council, in accordance with Section 31B of the Act, as the basic amount of its Council Tax for the year (including Parish precepts).

 

(d)    £0                        being the aggregate amount of all special items (Parish precepts) referred to in Section 34(1) of the Act.

 

(f)      £1,765.49             being the amount at 3(d) above less the result given by dividing the amount at 3(e) above by Item T (1(a) above), calculated by the Council, in accordance with Section 34(2) of the Act, as the basic amount of its Council Tax for the year for dwellings in those parts of its area to which no Parish precept relates

 

20.   That it be noted that West Midlands Police and Fire Authorities have issued precepts to the Council in accordance with Section 40 of the Local Government Finance Act 1992 for each category of dwellings in the Council’s area as detailed in the report.

21.   That the Council, in accordance with Sections 30 to 36 of the Local Government Finance Act 1992, hereby sets the aggregate amounts as detailed in the report as the amounts of Council Tax for 2021-2022 for each part of its area and for each of the categories of dwellings.

 

22.   That, having calculated the aggregate in each case of the amounts at (3) (f) and (4) above, the City Council, in accordance with Section 30(2) of the Local Government Finance Act 1992, hereby sets the following amounts as the amounts of the Council Tax for the year 2021-2022 for each of the categories of dwellings as detailed in the report.

 

23.   That a notice of the amounts payable in respect of chargeable dwellings in each valuation band for the year commencing on 1 April 2021 be published in at least one local newspaper and that in accordance with Section 3(2) of the Local Government Finance Act 1992, this notice shall also make reference to the National Non-Domestic Rating Multiplier set by the Secretary of State, and specify that the Council Tax and the non-domestic rate demands are annual demands which cover the full financial year.

 

24.   That the Council has determined that its relevant basic amount of Council Tax for 2021-2022 was not excessive in accordance with principles approved under Section 52ZB Local Government Finance Act 1992.

 

25.   That as the billing authority, the Council has not been notified by a major precepting authority that its relevant basic amount of Council Tax for 2021-2022 was excessive and that the billing authority was not required to hold a referendum in accordance with Section 52ZK Local Government Finance Act 1992.

 

26.That it be noted that the MRP charge for the financial year 2021-2022 would be £18.2 million; it was forecast to increase to £25.5 million in 2022-2023 (paragraph 2.14 of the Cabinet report).

27.That it be noted that Cabinet or Cabinet (Resources) Panel and Council would receive regular Treasury Management reports during 2021-2022 on performance against the key targets and Prudential and Treasury Management Indicators in the Treasury Management Strategy and Investment Strategy as set out in paragraph 2.12 and Appendices 2 and 3 of the Cabinet report.

 

Supporting documents: