Issue - meetings

The Executive Director of Finance and Corporate Resources presented an update on the MTFP 2019/20 to 2022/23.  Members were advised that the budget would not be finalised until the Executive Committee meeting that was due to take place immediately before Council on 25^th February 2019.  On the date of the meeting there remained a budget gap of £195,000 which would need to be addressed by 25^th February.  As the budget remained to be finalised Members were advised that details such as the budget bids would change and therefore Members were advised that it would be sensible not to make any decisions at this stage.

The gap over the four year period was projected to increase to £1.6 million.  However, there remained a lot of uncertainty with respect to government funding for local government.  Clarity still needed to be provided about how much revenue support grant, if any, would be received by the Council in future years, whether the Council would continue to receive any additional funding from the New Homes Bonus and how much funding would be received by local authorities from business rates.  For these reasons the figures were estimates.

Officers were working on the basis that Council Tax would increase by 2.99 per cent and this had been incorporated into the MTFP.  There was the potential that the Council would need to make a £150,000 contribution to the Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP).  As the Worcestershire Business Rates Pool had been approved by the Government it was likely that this would be funded from that budget.  The £150,000 was an estimate based on the figure that had been noted by both Bromsgrove and Wyre Forest District Councils. 

During discussions about the GBSLEP questions were raised about the payments that had been made to the Worcestershire LEP and the Staffordshire LEP and the reasons why this payment had not also been made to the GBSLEP.  The Chair explained that it had recently been clarified that the GBSLEP should also have received this funding from the Government and this would happen in due course.

To address the budget gaps Officers would be reviewing the Council’s reserves to assess whether these were all required.  There was also the possibility there would be funding opportunities for the Council in terms of social care and early help intervention services.

Members noted that reference was made in the report to funding for the Christmas lights.  This had been included as a budget bid in the MTFP in 2018 but at the time Members had been assured that this would only happen the once.  Officers were therefore asked to double check why a budget bid for Christmas lights was being requested for a second year. 

RESOLVED that

the report be noted.

The Executive Director of Finance and Corporate Resources tabled a presentation which outlined the Council’s current budgetary position (Appendix 1).  Whilst delivering this presentation the following points were highlighted for Members’ consideration:

·                Further information would be available from the Government about the forthcoming Local Government Funding Reform in the spring.

·                The service specific cost drivers referred to in paperwork relating to the Local Government Funding Reform were more relevant to Worcestershire County Council as the local provider of social services.

·                The Business Rates Baseline Reset in 2020/21 would lead to any growth in business rates in previous years being absorbed into the baseline. 

·                Officers had built into the budget an assumption that the Council would increase Council Tax by 2.9 per cent following a change to the level of increase in Council Tax that would trigger a referendum to three per cent.

·                Worcestershire County Council was consulting with the Government about the reasons why the Worcestershire Business Rates Pilot bid had been unsuccessful.  This would help the authorities to amend their proposals for any future opportunities to bid.

·                The Council had anticipated, based on performance in previous years, that it would meet the baseline target for growth of Band D properties in order to secure funding from the New Homes Bonus.  Unfortunately failure to do so had implications for the Council’s budget.

·                CMT were in the process of reviewing the Council’s budget for 2018/19 on a line-by-line basis.  The Council had to achieve a balanced budget in the first year of the Medium Term Financial Plan (MTFP), though this was not necessarily required for the subsequent three years.

·                The Council’s proposed MTFP for 2018/19 to 2020/21 would be presented for the consideration of the Executive Committee on 6^th February.  This would be subject to detailed scrutiny on the 13^th February and a final decision would be taken by Council on 19^th February.

Following delivery of the presentation the Chair explained that he had asked Officers to investigate the potential for the Council to work with other local authorities to lobby the Government over the deadweight rules in respect of the New Homes Bonus.  Unfortunately, whilst there had been significant development in the Borough the majority of these developments involved Band A – C properties.

RESOLVED that

the presentation be noted.