Decision Maker: Cabinet
Decision status: Recommendations Approved
Is Key decision?: Yes
Is subject to call in?: No
To consider the draft budget proposals for 2021/22.
1. Cabinet considered the budget proposals for 2021 in respect of:
· General Fund – Revenue and Capital
· Housing Revenue Account – Revenue and Capital
2. Cabinet approves that consultation be carried out in respect of proposed Council Tax levels for 2021/22 for the period 13-26 January 2021 (inclusive).
3. Cabinet approves the cessation of the Deepings Special Expense Area from 1 April 2021.
4. Cabinet considered the proposed fees and charges for 2021/22 as set in the supplementary Appendix D of the joint report from the Cabinet Member for Finance and Resources and the Cabinet Member for Housing and Planning.
5. Cabinet approves the increase of the regeneration reserve by £500k by the following movements:
· £250k movement from the Commercial reserve.
· £250k movement from the Invest to Save reserve.
6. Cabinet approves the Climate Change reserve be included in the 2021/22 budget framework proposals at a minimum level of £20k.
Considerations/reasons for decision
· Joint report from the Cabinet Member for Finance and Resources and the Cabinet Member for Housing and Planning on the Budget Proposals for 2021/22 and indicative budgets for 2022/23 and 2023/24 giving details of the draft budget estimates for 2021/22, revenue and capital for both the General Fund and the Housing Revenue Account (HRA).
· The Council had approved a Corporate Plan that sets out a clear vision and key actions over the period of the Plan 2020 - 2023. The budget proposals had been formulated within the context of the Corporate Plan ambitions and alignment to the five priorities; Growth and our economy; Housing that meets the needs of all residents; Healthy and strong communities; A clean and sustainable environment; A high performing Council.
· The budget proposal had been built against a backdrop of financial challenges; the delay in the national review of the local government funding formula and the detrimental impact the Covid-19 pandemic has had on the Council’s resources.
· The proposals had been formulated by the Cabinet, working closely with senior officers, through a number of budget sessions. Workshops had been held which focused on the spending ambitions of the Council to drive forward the Corporate Plan within financial parameters.
· The financial outlook for 2021/22 remained uncertain and the budget proposal were underpinned by a number of assumptions relating to the recovery of income levels and future expenditure projections.
· The Provisional Settlement from Government had included a number of financial measures to support the financial assumptions which included the income losses compensation scheme which would continue to June 2021 and a one year lower tier un-ring fenced grant.
General Fund – Revenue
· An increase in Local Government core spending power of 4.5% for 2021/22. The increase was calculated on the assumption that Council’s will maximise the Council Tax increases available.
· A new lower tier services grant of £365k had been allocated to the Council for 2021/22 only.
· Indicative income from Council Tax based on proposals which would be subject to public consultation from 13 January 2021 to 26 January 2021; a £5 increase on a Band D property, a 3% increase on a Band D property, a 2% increase on a Band D property or no increase.
· Budget proposals compiled on the assumption that the Cabinet recommended a £5 increase on a Band D property for 2021/22 in order to take advantage of the limited availability of the high level.
Fees and Charges
· A summary of draft fees and charges proposals for 2021/22 as set in the report of the Cabinet Member for Finance and Resources and shown within the supplementary Appendix D circulated.
· Highlighted proposals were the £3 increase on the annual collection charge for Green waste, Grantham Pay and Display car parking, 10p increase per tariff up to and including 3 hours and Stamford Pay and Display car parking, 30p increase per tariff up to and including 3 hours
Housing Revenue Account
· The Housing Strategy 2017-2021 continued to provide the overarching framework for the budget proposals.
· The budget formation had taken into consideration the deliverables arising from the Compliance Audit Action Plan.
· Following a reduction in the (Consumer Price Index) CPI in September 2020 to 0.5%, budget income for the next financial year had been reduced by approximately £1.1m and cumulatively over £5m for the next three financial years.
· Due to a number of competing factors it had only been possible to present a one-year balanced revenue account, following years are projecting a revenue deficit.
· The rent increase is proposed at 1.5% and garage rents are proposed to increase by 3%.
Capital Programme (General and Housing Revenue Account)
· The detailed Capital Programme attached to the report from the Cabinet Member for Finance and Resources and the Cabinet Member for Housing and Planning at Appendix B.
· The Council’s ambitions of growth and investment in its assets and to support the delivery of quality services.
· The capital programme focused on investing in Council assets to improve the service offer and particularly in relation to the arts offer with a combined investment programme of £390k across the two arts venues. Other investments included the Street Scene Fleet and the car parking offer with maintenance required at Welham Street car park, Grantham.
· The Housing Investment Programme focussed on the new build and stock acquisition programme and the objectives of the HRA Business Plan.
· A new build programme which outlined a 3-year capital programme totalling £44.3m and anticipated the delivery of 412 properties.
· The investment programme may need reviewing once the full details of the Stock Condition Survey was analysed, other priority investment areas could be identified.
Reserves and Balances
· Details of the reserves, used to meet known and predicted liabilities.
· Reserve movements outlined within Table 17 and 18 of the report and shown within Appendix C.
· Recognition by the Government that the Collection fund would be under pressure due to the challenges in collection rates for both Council Tax and Business Rates. New legislation introduced to allow billing authorities to spread the anticipated deficit over a three financial year period. The change affected all three major precepting authorities proportionally from 2021/22.
Report author: Richard Wyles
Publication date: 13/01/2021
Date of decision: 12/01/2021
Decided at meeting: 12/01/2021 - Cabinet