Agenda item

Draft Budget and Medium Term Financial Strategy 2019-2020

Decision:

1.     That the high-level budget strategy for 2019-2020 be approved, including directorate level budget reduction targets, for inclusion in the Draft Budget and Medium Term Financial Strategy 2019-2020, to be reported to Cabinet in October 2018.

 

2.     That work continues between July and October 2018 to further develop and identify new budget reduction and income generation proposals towards the directorate level budget reduction targets for 2019-2020, in order to ensure that a balanced budget can be set in 2019-2020.

 

 

3.     That progress on the development of budget reduction and income generation proposals be reported to Cabinet in October 2018 for approval to proceed to the formal consultation stage of the budget process.

 

4. That further options are explored between July and October 2018 to address the updated projected budget deficit of £3.3 million for 2019-2020 based on the Council’s high-level strategy.

 

Cabinet noted:

 

1.     That a significant element of the high-level budget strategy for 2019-2020 relate to oneoff opportunities that can be achieved in 2019-2020.

 

2.     That the updated projected deficit assumes the achievement of budget reduction proposals amounting to £28.3 million over the two-year period from 2018-2019 to 2019-2020.

 

3.     That, due to external factors, budget assumptions remain subject to significant change, which could, therefore, result in alterations to the financial position facing the Council.

 

4. 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.

5. That the General Fund revenue outturn position for 2017-2018 was a net underspend of £781,000 (-0.35%) against the net budget requirement of £222.6 million, after meeting the net cost of redundancy and pension strain, after the use of capital receipt flexibility

and, contributions to essential specific reserves, as reported to Cabinet at this meeting in the Revenue Budget Outturn 2017-2018 report.

 

6. That whilst the positive General Fund outturn position during 2017-2018, and the resulting adjustments to reserves, will help to support the Council’s short term financial position, it does not address the challenging financial position that the Council finds itself in over the medium term; as detailed in this report.

 

7. 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.

 

8. That the 2019-2020 budget timetable will, as in previous years, include an updated report presented to Cabinet in October 2018 detailing budget reduction and income generation proposals that will be subject to formal budget consultation during October – December 2018. Further to this, an update on all budget assumptions and the Provisional Local Government Settlement will be presented to Cabinet by January 2019, with the final

budget report due to be approved by Full Council in March 2019.

Minutes:

Councillor Louise Miles presented the Draft Budget and Medium Term Financial Strategy 2019-2020 for approval. The report provided an update on progress towards identifying additional budget reduction proposals in order to address the projected £19.5 million budget deficit for 2019-2020.

 

Resolved:

 

1.    That the high-level budget strategy for 2019-2020 be approved, including directorate level budget reduction targets, for inclusion in the Draft Budget and Medium Term Financial Strategy 2019-2020, to be reported to Cabinet in October 2018.

 

2.    That work continues between July and October 2018 to further develop and identify new budget reduction and income generation proposals towards the directorate level budget reduction targets for 2019-2020, in order to ensure that a balanced budget can be set in 2019-2020.

 

3.    That progress on the development of budget reduction and income generation proposals be reported to Cabinet in October 2018 for approval to proceed to the formal consultation stage of the budget process.

 

4.    That further options were explored between July and October 2018 to address the updated projected budget deficit of £3.3 million for 2019-2020 based on the Council’s high-level strategy.

 

5.    That it be noted, that a significant element of the high-level budget strategy for 2019-2020 relate to oneoff opportunities that can be achieved in 2019-2020.

 

6.    That it be noted, that the updated projected deficit assumes the achievement of budget reduction proposals amounting to £28.3 million over the two-year period from 2018-2019 to 2019-2020.

 

7.    That it be noted, that due to external factors, budget assumptions remain subject to significant change, which could, therefore, result in alterations to the financial position facing the Council.

 

8.    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 would impact upon the Council’s budget. At the point that further information was known it would be incorporated into future reports to Councillors.

 

9.    That it be noted, that the General Fund revenue outturn position for 2017-2018 was a net underspend of £781,000 (-0.35%) against the net budget requirement of £222.6 million, after meeting the net cost of redundancy and pension strain, after the use of capital receipt flexibility and, contributions to essential specific reserves, as reported to Cabinet at this meeting in the Revenue Budget Outturn 2017-2018 report.

 

10.That it be noted, that whilst the positive General Fund outturn position during 2017-2018, and the resulting adjustments to reserves, would help to support the Council’s short term financial position, it did not address the challenging financial position that the Council finds itself in over the medium term; as detailed in this report.

 

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.

 

That it be noted, that the 2019-2020 budget timetable would, as in previous years, include an updated report presented to Cabinet in October 2018 detailing budget reduction and income generation proposals that would be subject to formal budget consultation during October – December 2018. Further to this, an update on all budget assumptions and the Provisional Local Government Settlement would be presented to Cabinet by January 2019, with the final budget report due to be approved by Full Council in March 2019.

Supporting documents: