Issue - meetings

This report sets out in detail the draft General Fund Budget for 2021/22 and the latest Medium Term Financial Plan. The Financial Plan sets out the key work streams for the Council to focus on which, collectively, aim to address the significant shortfall in annual budget projected over the medium term.

            This report contains the following Annexes:

            Annexe 1 – draft Medium Term Financial Plan

            Annexe 2 -  draft General Fund Budget Summary 2021/22

            Annexe 3 – statement of key variations from 2020/21 base budget 

            Annexe 4 – draft Fees & Charges for 2021/22

            Annexe 5 – draft Capital Programme

            Annexe 6 – schedule of projected reserves and provisions

Recommendation

It is recommended that the Executive, after considering comments from the Value for Money Overview & Scrutiny Committee, makes the following recommendations to Council, to:

1.    agree a £5 increase in Waverley’s Band D Council Tax Charge for 2021/22 with resultant increases to the other council tax bands;

2.    agree to make no change to the Council’s existing Council Tax Support Scheme and continue to allocate additional Government support to help those council taxpayers most financially affected by the pandemic;

3.    agree the proposed Fees and Charges for 2021/22;

4.    approve the General Fund Budget for 2021/22 as summarised in Annexe 2, incorporating the baseline net service cost variations included at Annexe 3 and the staff pay award;

5.    approve the specific use of reserves to mitigate the Covid-19 uncertainty risk and the estimated reduction in retained business rate funding over the Medium Term Finance Plan period, and the other reserve movements as set out in the annexe 6,

6.    approve the General Fund Capital Programme; and,

7.    agrees to extend the 2020/21 Capital Strategy to cover the period up to the Council meeting in April 2021.

69.1    Cllr Mark Merryweather, Portfolio Holder for Finance, Assets and Commercial, introduced the report setting out the draft General Fund Budget for 2021/22 and the latest Medium Term Financial Plan (MTFP) 2021/22 to 2023/24. The content of the report and annexes had already been considered in depth at the Value for Money Overview & Scrutiny Committee meeting, and followed on directly from the presentations and discussion on the budget and MTFP that had been held during the year as the financial impact of the Covid pandemic had become clearer.

69.2    Cllr Merryweather outlined the structure of the General Fund and the constraints on use of different categories of funds. The pre-Covid 2020/21 budget and MTFP was already under significant financial pressure due to factors outside of the council’s control, in particular due to government cuts to the council’s share of business rates. In August, the estimated gross financial loss in 2020/21 alone was £6.6m, due to lost income and increased costs arising from responding to the pandemic, and this had been addressed through a combination of financial support from the government, emergency savings, and a drawdown of earmarked reserves. The budget strategy for 2021/22 and the MTFP continued the approach of managing the capital programme and earmarked reserves, alongside a proposed maximum increase in council tax in 2021/22.

69.3    With regard to the Capital Strategy, the intention had been to recommend the existing Strategy to April 2021 to allow recently announced changes in the government’s borrowing rules to be included. However, a technical consultation had just been issued by the Chartered Institute of Public Finance and Accounting on proposed changes to the Treasury Management Code and Prudential Code of Capital Finance in Local Authorities to reflect the proposed government changes, with the intention of publishing a revised Prudential Code towards the end of the year for 2021/22 implementation. In the light of this, it was now recommended that Council extend the validity of the 2020/21 Capital Strategy until an updated document could be presented to Council by February 2022 at the latest.

69.4    The proposed amendment to Recommendation 7 was seconded by the Leader, and agreed unanimously by the Executive, as follows:

“7. Agrees to extend the 2020/21 Capital Strategy to cover the period up to the Council meeting in February 2022, at the latest.”

69.5    In response to a question from Cllr Beaman that highlighted the uncertainty and dissatisfaction around the business rates regime, Cllr Merryweather reiterated his view that the most beneficial step the government could take to help council funding would be to allow the council to keep a higher proportion of the business rates collected. The Leader advised that he would be writing to the government to make this point, and he would be inviting the Leader of the Principal Opposition Group to join in with him in this.

69.6    The Executive RESOLVED to recommend to Council that it:

1.    agree a £5 increase in Waverley’s Band D Council Tax Charge for 2021/22 with resultant increases  ...  view the full minutes text for item 69