Decision details

- To agree the budget strategy process and timetable for the 2017/18 budget cycle.
- To agree the inclusion of identified budget savings and pressures in the budget.
- To agree proposals for changes to General Fund Reserve levels with the Prudent Minimum Balance.

- To agree the Council's Efficiency Plan.

Matter for Decision

The Officer’s report presented and recommended the budget strategy for the 2017/18 budget cycle and specific implications, as outlined in the Mid-Term Financial Strategy (MTFS) October 2016 document.

The report also recommended the approval of new capital items and funding proposals for the Council’s Capital Plan, the results of which are shown in the MTFS.

At this stage in the 2017/18 budget process the range of assumptions

on which the Budget-Setting Report (BSR) published in February 2016

was based need to be reviewed, in light of the latest information available, to determine whether any aspects of the strategy need to be revised. This then provides the basis for updating budgets for 2017/18 to 2021/22. All references in the recommendations to Appendices, pages and sections relate to the MTFS Version 1.

The recommended budget strategy is based on the outcome of the review undertaken together with financial modelling and projections of

the Council’s expenditure and resources, in the light of local policies and priorities, national policy and economic context. Service managers have identified financial and budget issues and pressures and this information has been used to inform the MTFS.

Decision of Executive Councillor for Finance and Resources to recommend to Council to:

General Fund Revenue

     i.        Agree the budget strategy and timetable as outlined in Section [pages 1 to 2 refer] of the MTFS document.

    ii.        Agree incorporation of the budget savings, pressures, proposals and rephasings identified in Section 4 (pages 13 to 15 refer). This provides an indication of       the net savings requirements, by year for the next 5 years, and     revised General Fund revenue, funding and reserves projections    as shown in Section 5 (page 16 refers) of the MTFS document.

Capital

     i.        Allocate £20m in the Capital Plan for investment in a new programme of commercial property acquisition with the emphasis on security of assets and their income stream and

  ii.          Delegate authority to the Head of Property Services to identify and invest  in  suitable  commercial  property  up  to  £20m  (inclusive  of acquisition  costs)  in  consultation  with  the  Executive  Councillor  for Finance and Resources, the Chair and Opposition Spokesperson for Strategy & Resources Scrutiny Committee and the Head of Finance.

 iii.          Note the changes to the Capital Plan as set out in Section 6 [pages

17 to 21 refer] of the MTFS document and agree the new proposals:

Ref.                                     Description                                         2016/17

£000

     Proposals

Reserves

i.     Agree changes to General Fund Reserve levels, with the Prudent Minimum Balance being set at £5.31m and the target level at £6.37m as detailed in Section 7 [pages 22 to 25 refer].

Reason for the Decision

As set out in the Officer’s report.

Any Alternative Options Considered and Rejected

Not applicable.

Scrutiny Considerations

The Committee received a report from the Head of Finance.

The Committee made the following comments in response to the report:

i.                Asked on what basis it was concluded that the Council should invest in commercial property and what type of commercial property the Council would invest in.

ii.                Questioned income and staffing underspend and the £200,000 contribution to the Sharing Prosperity Fund.

iii.                Commented that bids for the Sharing Prosperity Fund were being processed at the moment.

The Executive Councillor made the following comments:

i.                The Council needed to make its assets earn money to bridge the £2.2 million budget gap. The Council’s portfolio was currently heavily reliant on retail commercial property and would look at warehouse and office investment opportunities to balance the portfolio.

ii.                The Sharing Prosperity Fund was the Anti-Poverty fund, currently the fund was in danger of running out before the end of the current financial year.

iii.                Confirmed that a review of the Sharing Prosperity Fund had been presented to the Community Services Scrutiny Committee in June but a briefing note on the Fund would be made available to Councillors to explain the bidding process for the fund and provide clarification on the allocation.

The Committee resolved by 4 votes to 0 to endorse the amended recommendations.

The Executive Councillor approved the amended recommendations.

Subsequent to the meeting the Head of Finance requested a change to recommendation 2.2 to add the wording (underlined) ‘budget savings, pressures, proposals and rephasings’ to properly cross reference the MTFS document as detailed in recommendation 2.2.

Conflicts of Interest Declared by the Executive Councillor (and any Dispensations Granted)

No conflicts of interest were declared by the Executive Councillor.