To seek the views of the Scrutiny Management Board on the budget proposals for 2023/24 following the announcement of the provisional financial settlement.

The Chair introduced the item and noted that the key lines of enquiry for consideration of the revenue budget were;

• Robustness of information
• Questions around the Medium Financial Terms Strategy
• Robustness of the estimates
• Questions around base budget

To assist public understanding of the papers the committee sought clarification to the term ‘Central’ that appeared on page 266 of the papers.

The s151 officer confirmed that the term ‘Central’ related to the cost of borrowing in relation to employee pension costs. It is held centrally rather than trying to allocate the costs across the council.

The committee raised questions about the rates of inflation that had been used in the medium term financial strategy. They asked whether there was a narrative on which the assumptions had been made. There was concern that there was a danger of over inflating the figures in the MTFS. There would be no objection to the use of the figures provided there is an explanation on how the figures had been created.

The Cabinet member responded, advising that national inflation and CPI do not necessarily reflect where inflation hits the council in terms of the kind of services the council deliver and those that we procure through others.

The s151 officer advised that they (Cabinet) have to take a view going forward and that the council has to set a balanced budget. In terms of assumptions around inflation they are prudent. At the moment no one knows in which direction inflation will go. He confirmed he was comfortable with the assumptions as they are reasonable and fair.

There followed a discussion about the rates of inflation that had been used in setting the budget, whether other indices had been considered such as construction industry bodies and what sensitivity analysis had been done. The committee concluded that there needs to be a narrative provided to justify the inflation figures used for the budget in the MTFS.

Resolved:

That a narrative be provided, in preparation for the cabinet meeting, to justify the inflation figures used for the budget and the MTFS

The committee sought confirmation around figures that has been used for the Social Care Support Grant, the Market Sustainability and Cost of Care and the New Homes Bonus.

The committee were advised that the figures have come from the Directorate understanding of what the government likely grant schemes will be. The government has changed the calculation for the New Homes Bonus to net off empty homes. The Market Sustainability and Cost of Care only runs for a further year so it is being incorporated into the social care funding pressure.

The committee enquired about the Economy and Environment budget which has been flat for the last 3 years and whether it could respond to the climate change pressures.

The Director for Economy and Environment advised that there was a new Economic Plan being developed in partnership with other organisations. The department seeks external grant funding for projects rather than requesting increases to base budgets. The  ...  view the full minutes text for item 60