To agree the draft 2021/22 budget and associated medium term financial strategy and treasury management strategy for recommendation to Council on 12 February.

The proposed budget reflects current and expected service delivery requirements and the provisional local government settlement announced on 17 December. Overall the base budget for 2021/22 is proposed to increase to fund budget pressures. Savings of £11.2m are required in 2021/22 and an increase in council tax of 4.99% (inclusive of 3% adult social care precept) is proposed to deliver a balanced budget.

The draft medium term financial strategy (MTFS), attached at appendix A, has been updated to reflect current assumptions on future years funding and service requirements in line with the County Plan.

The treasury management strategy, attached at appendix D, includes the proposed borrowing and investment strategy, the council’s expected minimum revenue provision and the associated prudential indicators which demonstrate that the council’s proposed capital investment budget is affordable, prudent and sustainable

That:

(a)   the following be recommended to Council;

a.     the council tax base of 68,355.22 Band D equivalents;

b.    an increase in core council tax in 2021/22 of 1.99%;

c.     an additional precept in respect of adult social care costs of 3% applied to council tax in 2021/22 resulting in a total council tax increase of 4.99%, increasing the band D charge from £1,573.77 to £1,652.30 for Herefordshire Council in 2021/22;

d.    the balanced 2021/22 revenue budget proposal totalling £161.0m, subject to any amendments approved at the meeting, specifically the net spending limits for each directorate as at appendix C;

e.     delegation to the section 151 officer of the power to make necessary changes to the budget arising from any variations in central government funding allocations via general reserves;

f.      the medium term financial strategy (MTFS) 2021-24 at appendix A be approved; and

g.    the treasury management strategy at appendix D be approved.

h.    that the growth bid to fund a Armed Forces Covenant Support Officer, attached at appendix H be approved.

(b)  the responses to scrutiny committee’s recommendations as provided in paragraph 50 be approved.

1.     It is open to Cabinet to recommend alternative spending proposals or strategies; however, given the legal requirement to set a balanced budget, should additional expenditure be proposed compensatory savings proposals must also be identified. If it is proposed to spend less, the impact on service delivery of the proposed reduction should be considered.

2.     Cabinet can propose a council tax increase above the referendum principle levels. This is not recommended as doing so would require the increase to be subject to a local referendum, incurring additional costs to the council.