To agree the draft 2019/20 budget and associated medium term financial strategy and treasury management strategy for recommendation to Council on 15 February.

The chair of the meeting introduced the 2019/20 budget, medium term financial strategy and treasury management strategy. The council’s gross annual revenue expenditure of around £340m was funded by a combination of council tax, business rates, specific grants and other sources. Approximately £80m was ring-fenced to schools. There had been a reduction in central government Revenue Support Grant of 99% since 2011. An increase in council tax was proposed of 2.9% plus a further 2% ring fenced social care precept. The council was felt to be in an improved financial position.

In discussion of the proposed budget cabinet members noted the following key points:

·         the investment referenced in paragraph 17 of the report had since been returned to the council and was available to be reinvested;

·         the S151 officer reported that the pension scheme was currently fully funded and had insurance measures in place against a short or medium term drop in investment returns, the council was expecting a modest improvement in its position at the next tri-annual valuation;

·         the cost pressures arising from the restructure of Deprivation of Liberty Safeguards were complex and covered a number of threads, the funding would allow the council to change how it dealt with individuals in these circumstances;

·         the significant reduction in the central grant had been met by savings, cuts in services and by generating more local income;

·         the additional sparsity funding was welcomed and it was important to give a clear narrative regarding why that money was needed and what was done with it, for example highlighting the higher than average number of c and u classified roads and additional costs of providing services such as domiciliary care and refuse collections in sparsely populated areas;

·         the council had seen an increase in demand for support for children with special educational needs but had a strong track record of working with schools through the schools forum to manage these pressures, the council was in a better position on this than many other councils;

·         the confirmed settlement from government included an unexpected EU exit preparation grant of £105k for both 2018/19 and 2019/20;

·         the council did provide some IT equipment for looked after children and care leavers, depending on what was most appropriate for their needs, and this could include consideration of reuse of council equipment when it was no longer needed.

Each of the three scrutiny committees had considered the draft budget. All of the recommendations made had been supported. The chairs of the committees highlighted the following points from their discussion:

·         the additional funding planned for the children and families directorate was welcomed and responded to the feedback from the public consultation in which 78% agreed that employing more social workers and providing more support for children and families at an early stage was a priority;

·         consideration should be given to putting a percentage of s106 funding towards providing housing for older people;

·         the council should lobby government to ensure that funding settlements were fair on rural authorities. 

Group leaders  ...  view the full minutes text for item 49

To seek the views of the committee on the draft medium term financial

strategy (MTFS) 2017-21 and the budget proposals for 2019-20.

The committee considered the draft medium term financial strategy (MTFS) 2017-21 and the budget proposals for 2019-20.

The chief finance officer (CFO) gave a presentation.  The slides had been circulated separately as a supplement to the agenda papers. 

The acting director – economy and place (AD) presented slides relating specifically to the directorate.

The cabinet member – finance and corporate services (CMFCS) made the following principal points:

·        He commented on the significant savings that the council had been required to make over the past few years and the council’s track record in achieving those savings.

·        The proposed 2019/20 budget would increase council tax by 4.9% entailing a further £3m savings in 2019/20.  This was in line with the approved MTFS.

·        He referenced the new capital strategy document at appendix 5 to the report codifying the approach to capital investment.

·        He noted that the funding picture beyond March 2020 was as yet unclear meaning that a number of assumptions had had to be made about the government’s intentions.   In the next budget cycle there would be a new comprehensive spending review, a green paper on charging for care, details of what would replace the better care fund and the improved better care fund, and clarity on business rate retention.  Some one-off allocations of government funding were also to be expected and the 2019/20 budget may need to be amended to reflect these.

·        He observed that despite the significant reduction in revenue support grant over the past 10 year period the rise in council tax was below the rise in the retail price index.

In discussion the following principal points were made:

·        It was observed that there was little flexibility within the budget given the constraints, meaning the room to explore alternative approaches was limited.

·        Assurance was sought as to the robustness of the assumptions regarding the improved better care fund and the public health grant.  The CFO commented that there was a reasonable assurance that for 2019/20 the assumptions were sound.  There wasn’t the same level of certainty beyond that point and the council would have to respond accordingly. The CMFCS noted the certainty that accepting the four year settlement had brought and it appeared that that level of certainty was now to end.

·        The impact rural sparsity had on the council’s budget should not be overlooked and the council should continue to lobby with other authorities for this to be recognised.

·        It was important to ensure a good working relationship with health bodies in the county to maximise the effective use of resources to deliver care and for health bodies to reciprocate and acknowledge the need for that relationship.

The CFO commented that co-terminosity of boundaries with health bodies was an advantage.  The relationship between the council and health bodies was robust.  Work was ongoing in relation to an integrated care service with one financial control total. Where there was overlap as with the IBCF/BCF that was managed in partnership with health colleagues.  There was ongoing joint work on  ...  view the full minutes text for item 31