Issue - meetings

The Council is recommended to make the resolutions set out in the report at agenda item 6.

Portfolio Holder for Finance, Assets and Property.

The Leader of the Council introduced the General Fund Budget 2024/25 and thanked Cllr Mark Merryweather, Portfolio Holder for Finance, Assets and Property, on the preparation of his fifth budget for the Council.  The Leader expressed his concern with the government’s approach to the funding of local government which meant that Councils were having to be creative in finding options to balance their budgets due to continued uncertainty. Accordingly, the Leader proposed an alteration to the Motion, with the consent of Cllr Fairclough as seconder, to include an additional recommendation 9, in two parts:

That the Council notes:

(ix) (a) that Waverley Borough Council will explore the creation of a voluntary contribution scheme for Council Tax Band H residents of our Borough. 

(ix) (b) that a Temporary Executive Working Group (as per the protocol for Executive Working Groups) will be established to determine this scheme's scope, legal structure, governance, and communication and to bring back to Council for consideration.

The Leader stated that the alteration was modelled on a recent motion to Surrey County Council, and the proposed Executive Working Group would consider its detail together with successful schemes elsewhere. Nine rather than eight recommendations now formed the Motion recommended for approval and the Leader commended the Budget to Council, thanked Officers for their hard work in its preparation, and invited Cllr Merryweather to present the detailed Budget proposals. Cllr Merryweather, Portfolio Holder for Finance, Assets and Property introduced the General Fund Budget 2024/25 and his speech is appended to these minutes.

Councillor Martin, Leader of the Principal Opposition Group, addressed the meeting and proposed an amendment seconded by Councillor Goodridge. The amendment was tabled and read as follows:

Delete the words in iii) b) agree the increase to car parking charges as proposed in Annexe 4.2and add the words b) to exclude the proposed introduction of evening charges in selected car parks and to reduce the level of increase in parking charges as proposed in Annexe 4.2 to an average of 7% reducing the increased revenue from £447k to £295k in 2024/25.  

Together with adding the words:

ix. To reduce transfers to reserves as follows:

·       Reduce the one off growth in the property maintenance fund from £400k to £324k; and

·       Reduce the one off contribution to the Invest to Save Reserve from £450k to £374k

Councillor Martin introduced the amendment and referenced surpluses generated in the previous year and anticipated for the current year, together with a greater than expected government settlement. His view was that the proposed increase in parking charges could be lessened together with not introducing evening charges. A smaller increase instead could stimulate the local economy and lessen the financial strain on residents in light of the charges having been significantly increased three years ago. 

Councillor Goodridge spoke as seconder of the amendment and expressed his view that the increase in parking charges may deter visitors to town centres and was not aligned to the Council’s stated aim of investment in  ...  view the full minutes text for item 96

The Executive are recommended to make the resolutions set out in the report at agenda item 8.

Portfolio Holder for Finance, Assets and Property.

The Executive RECOMMEND that Council:

       I.          Agree a 2.99% increase in Waverley’s Band D Council Tax Charge for 2024/25 with resultant increases to the other council tax bands; 

     II.          Agree to continue the Council’s existing Council Tax Support Scheme at the current levels; 

    III.          Agree (a) to a general inflationary increase to Fees and Charges for 2024/25 except for car parking charges and some limited other exceptions as proposed in Annexe 4.1, (b) agree the increase to car parking charges as proposed in Annexe 4.2, and (c) agree the specific other increases to the fees and charges as proposed in Annexe 4.3; 

   IV.          Approve a general inflationary increase of 4.5% to the weekly charge for all garages from 1 April 2024;?

     V.          Approve the General Fund Budget for 2024/25 as summarised in Annexe 2, incorporating the baseline net service cost variations detailed at Annexe 1 and Annexe 3; 

   VI.          Approve the General Fund Capital Programme as detailed in Annexe 5;  

 VII.          Approve the reserve movements as set out in Annexe 6 and to agree a delegation to the S151 officer to agree draw down from the reserves if the use is in line with the approved purpose; and

VIII.          Approve an increase in inflation provision proposed within the General Fund budget of £111,252 to be funded by the £159,459 increase in funding guarantee grant as confirmed by the Department of Levelling Up, Housing and Communities on 5 February 2024.

Cllr Merryweather, Portfolio Holder for Finance and Assets, introduced the General Fund Budget 2024/25 and summarised:

·       That the report addressed the significant budget shortfall that would accumulate over the MTFP period and beyond

·       Government funding support had fallen further behind cost inflation and represented  only a small fraction of the business rates collected

·       A structural deficit existed where costs were inflating faster than the Council’s ability to increase funding, and would remain once inflation had decelerated

·       Additional gross service cost pressures had been identified totalling £2.8m per year from 2024 rising to £5.3m per year by 2028

·       Inflation would add £1.6m per annum to costs from 2025, rising to £4.3m per annum over the medium-term financial plan period

·       The Council tax hardship fund which had been funded from central government had now reverted back to the Council

·       Whilst some of the cost measures were close to exhaustion others like the collaboration with Guilford were on target to deliver their expected recurring annual savings

·       Fees, charges and other income excluding council tax fees and charges had been reviewed as part of the budget process and general inflationary increases had been proposed where appropriate, with some exceptions such as in the new contract for Leisure centres

·       In 2021, the council had approved a new car park pricing strategy which was based on the individual characteristics of and demands on the Council’s car parks. This allowed specific site rates to be increased or decreased to respond to the market as appropriate as car park usage rebounded.  The Council had approved revised car park tariffs which took effect from November 2021 but further increases had been resisted, which was now unsustainable

·       An inflationary rate increase together with a limited pilot of evening charges in specific central car parks were proposed but the implementation of Sunday car park charging had been resisted, unlike many of the authorities in surrounding areas

·       Inflation would fall over the plan period, government funding support would decrease, and reductions in the new homes bonus and business rates were anticipated

·       Overall, a balanced budget was proposed with a below inflation increase of 2.99% in Waverley's band D council tax charge for 2024/25; and

·       Officers were commended for their work in preparing the budget.

The Leader advised of an alteration to the recommendations to include recommendation viii, duly supported by the Executive. 

Executive Members’ statements in support of the recommendations included:

·       Expressing disappointment in the Governments’ approach to the funding of local government which meant that Councils were having to be creative in finding options, including potential exploration of a voluntary Council Tax contribution scheme, to balance their budgets due to continued uncertainty

·       That the Business Rates and Council Tax funding mechanisms created systemic inequality; and

·       The Budget was aligned to Council’s priorities including street cleaning, recycling and support for the maintenance of assets and green spaces.   

The Executive resolved unanimously to RECOMMEND that Council:

       i.          Agree a 2.99% increase in Waverley’s Band D Council Tax Charge for 2024/25 with resultant  ...  view the full minutes text for item 136

(Report and Annexes to follow)

This report sets out the draft General Fund Budget for 2024/25 and Medium-Term Financial Plan (MTFP) ending 2027/28. The MTFP sets out the key work streams for the Council to focus on over this period which, collectively, aim to address the significant shortfall in annual budget projected.

The Overview & Scrutiny Committee - Resources is asked to consider the report and agree any comments or recommendations to be passed to the Executive on the proposed recommendations to Executive and Council as set out in the report.

66.1     The Financial Services Manager highlighted the following details from the report:

·        The proposed 2.99% Council Tax increase; and

·        A Fees and Charges Review that has resulted in a proposed general inflationary increase of an average of roughly 4.5% (excepting the ‘break-even areas’ of licensing, land charges and building control). Car parking will also see an inflationary increase.

66.2     The Chair noted an error in the figure for the proposed car parking charges increase, which is 18%, not the stated 15%. The Financial Services Manager clarified that Annexe 1 contains the correct figure and this would be rectified.

Cllr Nicholson noted a reduction in the Baseline Net Service Cost compared to 2022-23, the saving from reducing the number of Waverley councillors, and stated that he felt car parking costs changes were proportionate.

66.3     Cllr Weldon queried whether the proposed 2.99% council tax increase could be insufficient and asked if undertaking a referendum to facilitate a larger increase was considered. The Chair queried the use of the 4.5% inflation assumption for 2024/25 given that inflation currently sits below 2%.  Officers clarified that they would reexamine the latest CPI figure, though this was unavailable at the time the report was written.

66.4     The Chair asked how the MTFP assumption that government funding would decrease through to 2028/29 could be made given that the bar chart at paragraph 10.5 seems to show an increase in government funding from 2021/22. The Financial Services Manager clarified that future estimates are necessarily projections and that the Fair Funding Guarantee means there can be no certainty as to future rates of funding. It was noted that the bar chart does not account for inflationary cost increases.

The Portfolio Holder for Finance, Assets and Property noted that the recent increases in direct Government funding were responses to significant macroeconomic conditions - specifically the pandemic and cost-of-living crisis - and that Finance officers model what is indicated by central government.

66.5     The Chair asked if the New Homes Bonus had been expected, how it was spent and what the consequences would have been had it not been allocated. The Financial Services Manager stated that the reserve top-ups made in additional revenue contributions to capital is likely drawn from these grants, and that these and additions to the Property Maintenance Fund would not have been achievable without them. It was stated that the 2024/25 Capital Programme would have undergone necessary review without the receipt of the grant, and clarified that using one-off grant monies to alleviate other increases in service costs would create an issue in the base for future years’ budgets.

66.6     Non-voting visiting member Cllr Austin stated that she felt the 4.5% CPI inflation rate is too high given the current rate, queried the graph at paragraph 10.5, and stated that she felt certain passages of the report are subjective or misleading.

66.7     Cllr Davidson stated that he felt MTFPs regularly only cover the following year with shortfall then forecast for subsequent years - he asked what plans  ...  view the full minutes text for item 66