Agenda item

To consider the development of the Medium Term Financial Plan for 2016 onwards and to consider the factors that will influence its delivery and that of the annual budget strategy 2017/18.

RECOMMENDED:

That the actions and the development of plans for options to support the Medium Term Financial Plan, as set out in Report Item 4 considered by the Cabinet, be supported.

The Cabinet was advised that, following consideration of the Medium Term Financial Plan in July (minute 14 refers), the Government’s offer of guaranteed funding levels to 2019/2020 had been accepted and, as required, the Council’s Efficiency Plan would be published on the website by 14 October 2016.

A key issue for the future was the redistribution formula that would be used with respect to business rates, and the degree to which local authorities retained the sums collected.  In this District the Council retained only a small proportion of the Business Rates collected.  It was understood that, by the end of this parliament, local government would not receive government grant but would be 100% funded by business rates, with the change being fiscally neutral over the medium term.

The Cabinet was advised of the key points of the Local Government Finance Settlement Technical Consultation Paper for 2017/18, which had been published in September.

In summary, the anticipated reduction in grant funding over the next 3 years was £3.051 million, a 37% reduction from 2016/17.  Increasing Council Tax in line with the thresholds allowed by Government would reduce the deficit to £1.898 million (a 10% reduction in the Council’s funding).  A breakdown of the funding assumptions was set out in Appendix 1 to the report.  A summary of estimated budget movements was set out in Appendix 2 to the report.  The Cabinet was advised that the financial projections were based on the working assumption that the Council would increase Council Tax in line with Government limits.  Council tax would however be set at the appropriate time.

The budget stabilisation process was continuing and other reviews were underway to achieve further savings.  The Cabinet was satisfied that by continuing to undertake efficiency reviews and to seek savings the Council was remaining in a strong financial position, responding to financial constraints, while maintaining healthy balances to allow flexibility for investment to achieve greater efficiencies.  The emphasis remained on protecting the delivery of front line services.

Resource plans had been produced for each portfolio, as attached as Appendices 3-8 of the report.

The asset maintenance and replacement programme to 2018/19 would be partly funded from reserves but would be mostly revenue funded.  The programme of work was being developed to remain within the financial parameters that had been agreed, and the summary programme would be reported to the Cabinet as part of the next Medium Term Financial Plan report.

RECOMMENDED:

That the actions and the development of plans for options to support the Medium Term Financial Plan, as set out in Report Item 4 considered by the Cabinet, be supported.