To agree the draft 2016-17 budget and medium term financial strategy (MTFS) 2016-20 for recommendation to Council on 5 February.

The deputy leader of the council presented the draft 2016/17 budget and the draft medium term financial strategy, drawing attention to government plans for funding reductions and the consequent need to secure economic growth in the county.

The director for resources, as chief financial officer to the council, confirmed the proposed budget was sound, deliverable and reasonable. Confirmation had been received from the department for communities and local government that the council’s proposals met the government’s criteria for the 2% adult social care levy.

In response to questions from members in attendance the following points were noted:

·         Litigation risks related to two ongoing court issues and a further longer term case; an appropriate risk mitigation reserve was maintained

·         The council’s liabilities in relation to introduction of the national living wage should be clearly explained.

Resolved that the following be recommended to Council:

                          i.          approval of a 1.9% increase in council tax in 2016-17;

                         ii.          approval of an additional 2.0% increase in council tax in 2016-17. This will result in a total council tax increase of 3.9% increasing a total band D charge from £1,275.10 to £1,324.83 for Herefordshire Council in 2016/17;

                       iii.          approval of the draft 2016-17 revenue budget (at appendix 1 to this report);

                       iv.          approval of the draft medium term financial strategy (MTFS) which incorporates the capital programme approved by Council on 18 December (at appendix 2 to this report);

                         v.          approval of the draft treasury management strategy (TMS) (at appendix 3 to this report); and

                      vi.            in the event of final central government funding allocations being above or below the provisional settlement level any variation is managed by an adjustment to general reserves.