Agenda item

RESOLVED:

That Cabinet recommend to Council that the:

1.               revised MTFP forecasts, as outlined within the report and appendices be adopted;

2.               options identified to close the budget gap for 2025/26 and through to 2028/29 are developed further;

3.               reporting timeline as set out in paragraph 74 be agreed;

4.               proposed car parking fees and charges from 1 January 2025 as referenced in paragraph 48 and detailed in appendix 5 are approved;

5.               proposed Keyhaven river fees and charges from 1 January 2025, as amended by Cabinet, and as detailed in a revised Appendix 6 for consideration by Full Council, are approved; and

6.               decision to enter into an agreement with other Hampshire authorities regarding the pooling of business rates is delegated to the s151 officer in consultation with the portfolio holder for Finance & Corporate.

KEY DECISION:

Report to Cabinet and Council.

PORTFOLIO:

Finance and Corporate

ALTERNATIVE OPTIONS CONSIDERED/REJECTED:

As set out in the report.

DECLARATIONS OF INTEREST:

None.

DISCUSSION:

The Portfolio Holder for Finance and Corporate introduced the report, explaining that it covered the period through to 2028/29.  It focused both on the medium term, and on the budget for next year and how it could be delivered.  Information was awaited on the local Government settlement.  The report included baseline assumptions of funding, and the additional funding support streams which might not be received in next financial year.  The balancing of the budget was a challenge.

The Portfolio Holder highlighted the cumulative deficit detailed in paragraph 34 of the report at that work was being carried out in order to address this year on year. It was necessary to maximise income and prioritise expenditure as well as continuing to deliver quality services to residents.    The fees and charges section of the report was highlighted and that the income generated from these would be used to help to deliver council services.  He reported that there was a considerable way to go to balance the budget over the length of the financial plan.

The Portfolio Holder proposed an amendment to recommendation no 5, relating to the Keyhaven river fees and that the proposed figures be amended to round them up to make the fees clearer and simpler.  It was noted that the amended proposed charges would be presented as part of the report to the next Full Council meeting for approval.

The Assistant Director Finance reported that the report provided an initial view of the Medium Term Financial Plan, explaining the timeline of working towards a balanced budget for 2025/26.  A number of assumptions were detailed in paragraph 11, noting the difficulties to plan with only a one-year settlement.  An assumption had been made around council tax increase and maintaining a £5 increase each year, in line with pre-referendum government parameters. 

Paragraph 20 showed the negative impact likely from the Fair Funding Review forecast for 2027/28 due to the reduced retention of business rates likely to received and therefore a potential £1.7m budget pressure.  It was highlighted that the estimated cumulative budget deficit for 2025/26 was £628k and that this deficit increased to £2.4m in 2028/29.  The proposed fees and charges would provide additional income to the council to help to address the budget deficit and that additional income was expected from commercial investment, as well in the longer term, the benefits expected from the transformation programme.  The Council had reserves which could be used for a one off mitigation, if necessary.

The HRA had similar budgetary pressures, including the pay award and inflation.  Significant investment was required on the greener housing strategy, safety works for high rise buildings, as well as improving the housing stock to EPC rating of a C.

The Financial Strategy Task and Finish Group had been reviewing the financial plan and an update would be provided to the Resources and Transformation Overview and Scrutiny Panel in November.  It was the intention to carry out further work and develop assumptions further in order to deliver a balanced budget in February 2025.

A number of non Cabinet Members spoke in relation the proposed car parking fee increases, particularly in relation to the car parking clocks.  Concern was raised in relation to the conflict with priorities in the Corporate Plan to support local businesses in the district, recognising that there were vacant shops in the high streets.  It was noted that there was a proposed 12.5% increase to the short stay parking clock and that the previous year had also seen a significant increase.  It was also highlighted how the district had poor public transport links making it more difficult to travel without a car, and that lower paid workers would be disadvantaged.  It was suggested that the parking clocks be raised in line with inflation rather than the proposed fees within the report.

The Cabinet Members for Finance and Corporate and Environment and Sustainability responded to the points raised.  It was felt that the car parking clocks with the proposed increase would still provide excellent value for money for car parking.  A short stay clock would cost 86p a week and this could be used across the district.  Comparison was made with other neighbouring authorities recognising that the proposed car parking charges were still lower than in other local authority areas.  The car parking fee increase would impact those users of the district car parks.