Agenda item

The Director of Finance and Strategic Resources to give a presentation.

          [A copy of his amended report number FIN239, the original of which was

          submitted to the Cabinet on 8^th August 2005, is circulated for information.]      

                                                                                                               (Enclosure)

DECISION:

1.                  To recommend the adaptation of the financial strategy as outlined in the report with any amendments based on the ongoing work of the budget working group and Cabinet that may continue to influence it.

2.                  To prepare a response to the Office of the Deputy Prime Minister consultation document on Formula Grant Distribution for 2006/2007;

3.                  To adopt the approach to budget development for 2006/2007 and value for money framework outlined in report FIN239;

4.                  To implement an effective budget consultation strategy for 2006/2007;

5.                  To review the purpose and amounts of reserves held;

6.                  To develop detailed options appraisal analysis of the impact of stock transfer on the General Fund;

7.                  To develop options for Council Tax setting for future years.

The Corporate Director of Finance and Strategic Resources presented his report FIN239 to the Council. The report contained ten strategy adaptations to the Medium Term Financial Strategy.  The Budget Working group would do detailed work Budget preparation and levying of Council Tax for 2006/2007. Membership comprises of the Resources DSP Members, a representative from all other Panels and the Cabinet. It was recommended that the Financial Strategy be adapted to include estimates of external financing and new financing, dealing with underspends, overspends and treasury management issues. A consultation document detailing grant settlements for 2006/2007 and 2007/2008 with options of funding formulae for local government had been received from the ODPM. The chosen option would mean a swing in District Council funding of plus or minus considerable sums, resulting in a net impact on Council Tax. Lincolnshire was preparing a united response to the missing millions campaign on behalf of the County and District Councils and the Police Authority, to provide a united proposal. The Council Tax re-evaluation exercise was underway; changes of value to the property could impact on Council Tax charges.

A self-assessment on the Council’s value for money would be submitted in September 2005, from this a service plan would be put together to ensure that services offer value for money. Value for money would be linked to government efficiency targets. The Local Area Assemblies would be used for initial feedback on parish precepts. SK today would also be used as a consultative mechanism. The main factor that would impact on the general fund would be the result of the ballot for (LSVT). The Resources and Assets Portfolio Holder moved the recommendations as written in report FIN239 with an addendum to Recommendation 1. This was seconded. The Portfolio Holder requested that under strategy 6, “the Resources DSP be kept informed”.

During debate on the report, concern was noted over transfer of services out of Council control and reinstatement at a later date, particularly with the possibility of a Leisure Trust. Members raised concerns that with provision being made for a positive ballot, it may seem that the decision to transfer the housing stock had already been made. Members debated the difference between taxpayers and users; car parks were given as an example of where the user may not be the Council Tax payer. Members asked questions of cashable efficiencies, the impact of special expense areas and affordable housing.

The Corporate Director of Finance and Strategic Resources responded to the points that had arisen. He emphasised that no decision on LSVT had been made but provision to counter the impact should of a positive ballot was necessary. Cashable efficiencies savings cover the provision of an identical service for less money, a non-cashable efficiency saving would be the use of staff to do a larger range of activities. Any monies spent on Special Expense Areas should be recoverable. On being put to the vote the motion was approved.

16:30 The Chairman left the meeting. The Vice-Chairman assumed the Chair.