Agenda item

The Cabinet Member for Finance presented the budget proposals for 2022/23 and indicative budgets for 2023/24 and 2024/25 and reported the requirement for the Council to set a balanced budget and agree the level of Council Tax for 2022/23.

 

A summary of proposals was contained as part of the report. It was highlighted that the proposals had been developed over the last five months in parallel with regular financial monitoring that took place through meetings of the Finance, Economic Development and Corporate Services Overview and Scrutiny Committee and Cabinet, with this being more frequent than usual due to financial volatility arising from the Covid-19 pandemic.

 

The Cabinet Member for Finance took this opportunity to place on record his gratitude to the Finance, Economic Development and Corporate Services Overview and Scrutiny Committee for its diligence throughout the financial year and thanked Cabinet, the Finance Team and budget holders across the Council for their work and contributions to the proposals set out in the report.

 

It was highlighted that the budget proposals had been scrutinised in detail at the meeting of the Budget Joint Overview and Scrutiny Committee held on 12 January 2022 where unanimous, cross-party support was given to the recommendations. This was followed by consideration at Cabinet on 13 January 2022 prior to a public consultation with South Kesteven residents and businesses between 14 and 28 January 2022. The draft proposals, including the outcomes of the consultation process, were reported to Cabinet on 8 February 2022 where the draft proposals were recommended to Full Council for approval.

 

The budget proposals for 2022/23 had been compiled following the recommendation from Cabinet to increase the District Council element of Council Tax by £5 a year, per Band D equivalent property, in order to take advantage of the limited availability of a higher level without the need for a referendum. 265 responses had been received following the public consultation process and approximately 30% supported the increase after taking into account the financial challenges the Council was facing, recognising the need to continue to invest and support the local economy and population. It was noted that over 66% of the Council’s residents resided in Band A to C properties and that only 8.5% of the overall Council Tax bill was attributable to South Kesteven District Council.

 

The Cabinet Member highlighted, in line with the rest of the country, that other areas of expenditure had increased for the Council, emphasising the need to increase income where possible.

 

The Council was committed to the continuation of developing and delivering the objectives of its Corporate Plan, with no reliance on its reserves. The Cabinet Member presented the various elements of the report, as follows:

 

·         Summary of General Fund estimates

·         Proposed budget bids

·         Proposed savings

·         Proposed changes to fees and charges

·         General fund budget increases

·         Treasury investment financial forecasts

·         Council Tax proposals

·         Housing Revenue Account proposed budget bids

·         Housing Revenue Account 2022/23 rent proposals

·         Housing Revenue Account fees and charges

·         General Fund Capital Programme

·         Housing Investment Programme

·         Budgeted General fund revenue reserve movements

·         Budgeted Housing Revenue Account reserve movements

·         Treasury Management Strategy and Capital Strategy

 

Table 1 in the report identified a deficit for 2023/24 which reflected the implications of the financial investment in the Deepings Leisure Centre. A work programme to secure sustainability was in the process of being developed and the Cabinet Member looked forward to working with Members on this. The following other key aspects of the budget proposals were outlined:

 

·         The recent decision by the Council to bring services delivered by InvestSK Ltd back in-house had been reflected in the budget proposals. The work of the Council’s other companies would continue to be reviewed by the Companies Committee

·         The reserves statement showed a forecast balance of £6.9m as at March 2022, which indicated a resilient financial cushion

·         The estimates set out in the budget proposals were considered to be robust, as set out in the statement by the Chief Finance Officer within the report, with the financial position of the Council being strong

·         There were financial challenges associated with the Housing Revenue Account. The stock condition survey would be available early in the new financial year and could change spending priorities, depending upon the outcome

·         £66m had been committed as part of the Council’s Capital Programme over the next three years, with 16% attributable to external borrowing and the remainder being met by the Council’s resources or external grant funding

·         Appendix I set out the statutory resolution for Council to consider in respect of Council Tax. A revised version of this Appendix had been published.

 

The Cabinet Member for Finance formally proposed the recommendations contained within the report, subject to consideration of the revised Appendix I document in relation to recommendation 3.

 

The Leader of the Opposition seconded the proposal.

 

In debating the proposal the following points were noted:

·         The Council Tax increase was reasonable given the financial pressure the Council faced

·         The inclusion of the investment in the Deepings Leisure Centre was pleasing to see as part of the budget proposals, however, this placed a consequential burden on the Council’s finances in the coming years which may require additional savings

·         Despite the financial challenges faced over the previous year, the budget proposals sought to keep the economy moving, particularly through initiatives such as the Welcome Back Fund, the Future High Streets Fund and Heritage Action Zone funding

·         The Council remained committed to making South Kesteven the best place to live, work and visit

·         Local Authorities across the country were beginning to feel the financial strain following the difficulties of the previous two years, with the whole Local Government sector experiencing significant financial challenge

·         The budget proposals reflected the Council’s commitment to meet the funding challenge in a way that maximised its existing revenue but would also limit the burden on taxpayers, with a commitment to protecting the services it provided

·         The Council should be very proud of the work it had done in relation to housing, which had moved the service into a much sounder footing

·         There were still challenges in relation to climate change following the Council’s declaration of a climate change emergency, however, the Climate Change Action Group would continue to have a key role to play

·         In order to take the district forward economically and politically it would be necessary to agree upon a devolution deal with the Government, in terms of funding and decision-making powers.

·         A question was raised regarding the Council’s Communications budget, suggesting that less of the budget should be allocated to external consultants than in previous years

·         Reference was made to a commitment three years ago stating that £30m would be invested in affordable housing over a five-year period. An update on progress was requested in terms of how much had been spent to date, how much had been allocated in the current budget for the coming year and how many houses would be built in 2022/23, 2023/24 and 2024/25

·         It was concerning that only £20,000 per annum had been allocated to the climate change budget

·         A question was raised as to why the food waste collection trial was being cancelled

·         The budget made further cuts to key services, with the District Council’s element of the Council Tax being increased despite respondents to the consultation opposing it

·         The removal of the Ward Member Grant was disappointing, with examples given of how the fund had benefitted small community groups

·         Proposals in the budget in relation to housing did very little to address the approximate 1,300 currently on the housing waiting list for Council housing

·         A suggestion was made to introduce a phased budgeting approach, particularly around those budgets identified as high risk in the risk register. A concern was expressed that some of the risks had been undervalued and would need more regular financial monitoring

·         The food waste collection trial had been cancelled as it was the intention to align this with the national scheme which would now not be rolled out until 2025. A decision had previously been taken not to purchase new freighters, which would cost approximately £225,000, and instead maintain second-hand machines. These repair costs had equated to £60,000. Rolling out the scheme across the district would cost approximately £3.5m which the Council could not currently afford. It was understood that funding would be made available by the Government to assist Local Authorities in rolling out a food waste collection service as part of the nationwide initiative in 2025

·         Problems associated with housing stock and the required investment in the Deepings Leisure Centre were the result of a lack of maintenance and neglect

·         The Community Awards had been held successfully this year in line with a modest budget, whereas the budget proposals for 2022/23 included an £8,000 commitment. A question was raised as to why this had increased

 

Councillor Ashley Baxter proposed an amendment to the budget proposals, as follows:

 

-       The deletion of the line in Table 3 referring to ‘Food Waste Services (Pilot)’

-       An increase in the climate change budget from £20,000 to £40,000

-       That these changes be funded from the Stabilisation Reserve Budget

 

The amendment was seconded.

 

In debating the amendment the following points were noted:

 

·         Food waste collection would become law in two or three years so it did not make sense to cancel the programme when it would need to be reintroduced again

·         A £20,000 allocation to something as considerable as climate change restricted the Council in being able to do anything significant

·         The two vehicles currently used for collecting food waste were coming to the end of their useful life and incurred a combined maintenance cost of £60,000. Replacement freighters would cost approximately £225,000 which the Council could not currently commit to

·         The Climate Change Action Group was in place to develop policies and initiatives or even commission work which could be costed and then referred back to Full Council at the relevant time in terms of budget allocation. The initial allocation in the budget of £20,000 did not therefore represent everything the Council would commit to addressing the issue of climate change

·         The food waste collection trial had been very useful but it was the intention to roll this out to the whole district and not just the areas selected as part of the trial. The Government would assist Councils with the implementation of a mandatory food waste collection service. It was therefore proposed to wait until 2025, or whenever the Government introduced the legislation, before launching a plan in partnership with the rest of the county via the Lincolnshire Waste Partnership utilising the funding the Government would provide. This matter had been discussed at a meeting of the Lincolnshire Waste Partnership earlier in the day prior to this meeting of Full Council

·         The food collection scheme was a trial which had reached its conclusion and it was not viable to continue it

 

A recorded vote on the amendment was required as it related to the Council’s budget, the results of which were as follows:

 

For:            Councillors Ashley Baxter, Harrish Bisnauthsing, Louise Clack, Phil Dilks, Virginia Moran and Amanda Wheeler (6)

 

Against:     Councillors David Bellamy, Pam Bosworth, Kelham Cooke, Helen Crawford, John Dawson, Barry Dobson, Ben Green, Breda-Rae Griffin, Graham Jeal, Gloria Johnson, Jane Kingman, Philip Knowles, Matthew Lee, Nikki Manterfield, Annie Mason, Penny Milnes, Robert Reid, Kaffy Rice-Oxley, Nick Robins, Penny Robins, Susan Sandall, Jacky Smith, Judy Stevens, Adam Stokes, Ian Stokes, Jill Thomas, Rosemary Trollope-Bellew, Sarah Trotter, Dean Ward, Hannah Westropp, Hilary Westropp, Mark Whittington, Jane Wood, Paul Wood, Sue Woolley, Linda Wootten and Ray Wootten (37)

 

Abstain:    Councillors Richard Cleaver, Jan Hansen, Ian Selby and Lee Steptoe (4)

 

The amendment was lost.

 

Returning to the original motion, the Cabinet Member for Finance commended the budget which would help the Council achieve the aims and objectives of its Corporate Plan.

 

A recorded vote on the motion was required as it related to the Council’s budget, the results of which were as follows:

 

For:            Councillors David Bellamy, Harrish Bisnauthsing, Pam Bosworth, Kelham Cooke, Helen Crawford, John Dawson, Barry Dobson, Ben Green, Breda-Rae Griffin, Graham Jeal, Gloria Johnson, Jane Kingman, Philip Knowles, Matthew Lee, Nikki Manterfield, Annie Mason, Penny Milnes, Robert Reid, Kaffy Rice-Oxley, Nick Robins, Penny Robins, Susan Sandall, Ian Selby, Jacky Smith, Judy Stevens, Adam Stokes, Ian Stokes, Jill Thomas, Rosemary Trollope-Bellew, Sarah Trotter, Dean Ward, Hannah Westropp, Hilary Westropp, Mark Whittington, Jane Wood, Paul Wood, Sue Woolley, Linda Wootten and Ray Wootten (39)

 

Against:     Councillor Lee Steptoe (1)

 

Abstain:    Councillors Ashley Baxter, Louise Clack, Richard Cleaver, Phil Dilks, Jan Hansen, Virginia Moran and Amanda Wheeler (7)

 

DECISION:

 

That Full Council:

 

1.    Sets a General Fund budget requirement of £14.562m for 2022/23 detailed at section 2 of the report and shown in detail at Appendix A (inclusive of special expenses).

 

2.    Approves a Council Tax base of 48,706.7 for the South Kesteven District.

 

3.    Approves a Council Tax level of £173.59 for 2022/23 (Band D property inclusive of special expense area) and the revised statutory resolution shown at Appendix I.

 

4.    Notes the indicative base estimates for 2023/24 and 2024/25 as detailed in the summary at Appendix A.

 

5.    Approves the fees and charges detailed at section 4 of the report and shown at Appendix B.

 

6.    Approves the General Fund Capital Programme for 2022/23 to 2024/25 and the budget carry forwards for 2021/22 detailed at section 5 of the report and shown at Appendix C.

 

7.    Approves the General Fund Capital Financing Statement detailed at Appendix C

 

8.    Approves the movements in General Fund Revenue and Capital reserves and balanced detailed at section 7 of this report and shown at Appendix D.

 

9.    Approves the Treasury Management Strategy Statement detailed at section 9 of the report and provided at Appendix G.

 

10.Approves the updated Capital Strategy as detailed in Appendix H.

 

11.Approves Housing Revenue Account dwelling rent increases of 4.1% (CPI + 1%) in accordance with Government guideline rent providing an average rent of £84.06 (an average rental increase of £3.28 per week).

 

12.Approves an increase in Housing Revenue Account garage rents of 3%.

 

13.Approves an average increase of 3% in Housing Revenue Account service charges for communal facilities and communal rooms.

 

14.Approves an increase in shared ownership rents by 4.1% (CPI + 1%).

 

15.Approves the Housing Revenue Account Revenue Summary for the year 2022/23 and notes the indicative budgets for 2023/24 and 2024/25 show at Appendix A.

 

16.Approves the Housing Capital Investment Programme for 2022/23 to 2023/24 and the budget carry forwards for 2021/22 detailed at section 5 of the report and as shown at Appendix C.

 

17.Approves the Housing Revenue Account Capital Financing Statement detailed at Appendix C.

 

18.Approves the Housing Revenue Account Revenue and Capital reserves and balances detailed at section 7 of the report and shown at Appendix D.