To seek the views of the general overview and scrutiny committee on the draft medium term financial strategy (MTFS) 2016-20 and the budget proposals for 2016-17.

The Director of resources and Head of corporate finance had given a presentation for all scrutiny members on Financial planning assumptions 16/17 – 19/20 at the Health and social care overview and scrutiny committee held earlier in the morning; the minutes of that meeting can be found here.

The Director of resources, responding to questions raised at the earlier meeting but relevant to the remit of this committee, made the following points:

i.       The level of response to the Priorities and budget consultation 2016-20 was gratifying, particularly in comparison to previous years.

ii.      There were risks within the budget but it had been reviewed and re-profiled in line with the MTFS.  Whilst it was difficult to predict the pressures on demand led services, especially in children’s safeguarding, it was considered that the budget was deliverable, supported by contingency and reserves.

iii.     It was not considered appropriate to consider the question of a referendum on raising council tax above 1.9% in advance of the publication of the Comprehensive spending review (CSR) on 25 November 2015.  Nevertheless, the following observations were made: the recent consultation might not be fully representative of the overall population and how they might vote in a referendum; a referendum would be costly in terms of both running the process and in rebilling council tax (as a referendum would not be held until May 2016); it was for members to determine the level of the budget and to consider the savings proposals; there had not been a successful referendum on increasing council tax to date; a significant proportion of budget expenditure related to adults’ wellbeing and children’s safeguarding and it was questionable whether voters in general would support higher levels of taxation to protect services for a relatively small percentage of the population.

The Deputy Leader said that the consultation was important but was only one part of the information used in terms of setting the budget.  It was considered that there would be financial risks associated with a referendum and the authority needed to be mindful of the implications of further increases for low wage earners.

A committee member made a number of comments, including:

a.       The consultation had seen a tenfold increase in the number of responses and 61% supported a council tax increase above 2% to protect services and defer savings.

b.       It was felt that the administration should trust residents and honour its pledge to work as one council, adding that a significant number of respondents to the consultation were aware of the context of the council’s financial position and the potential implications for further service cuts in the future.

c.       It was recognised that there were financial costs associated with a referendum but reference was made to expenditure of over £1 million on consultants for one infrastructure project which was not yet ready for consideration by the Planning Committee.  The member said that it should be considered a ‘spend to save referendum’ and would provide an opportunity for councillors to engage with  ...  view the full minutes text for item 46