Agenda item

This report sets out the draft General Fund Budget for 2022/23 and Medium-Term Financial Plan (MTFP) ending 2025/26. 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.

Recommendation

It is recommended that the Executive, after considering comments from the Policy

Overview & Scrutiny Committee, makes the following recommendations to Council, to:

1. agree a £5 increase in Waverley’s Band D Council Tax Charge for 2022/23 with resultant increases to the other council tax bands;

2. agree to continue the Council’s existing Council Tax Support Scheme at the current levels;

3. agree to extend Waverley’s council tax hardship fund to help those council taxpayers most financially affected by the pandemic, as set out in this report, with the final scheme details and criteria delegated to the S151 Officer in consultation with the Finance Portfolio Holder;

4. agree to make no change to Fees and Charges for 2022/23 except for those proposed in Annexe 4, including the new approach for planning pre-application fees;

5. approve the General Fund Budget for 2022/23 as summarised in Annexe 2, incorporating the baseline net service cost variations included at Annexe 1 and Annexe 3;

6. approve the General Fund Capital Programme as detailed in Annexe 5; and

7. approve the specific use of reserves to mitigate the Covid-19 uncertainty and other emerging economic risks including inflation; the estimated expected reduction in Retained Business Rates and New Homes Bonus funding over the Medium-Term Finance Plan period, and the other reserve movements as set out in Annexe 6.

RESOLVED

That the Executive, after considering comments from the Policy Overview & Scrutiny Committee, recommends to Council to:

1. agree a £5 increase in Waverley’s Band D Council Tax Charge for 2022/23 with resultant increases to the other council tax bands;

2. agree to continue the Council’s existing Council Tax Support Scheme at the current levels;

3. agree to extend Waverley’s council tax hardship fund to help those council taxpayers most financially affected by the pandemic, as set out in this report, with the final scheme details and criteria delegated to the S151 Officer in consultation with the Finance Portfolio Holder;

4. agree to make no change to Fees and Charges for 2022/23 except for those proposed in Annexe 4, including the new approach for planning pre-application fees;

5. approve the General Fund Budget for 2022/23 as summarised in Annexe 2, incorporating the baseline net service cost variations included at Annexe 1 and Annexe 3;

6. approve the General Fund Capital Programme as detailed in Annexe 5; and

7. approve the specific use of reserves to mitigate the Covid-19 uncertainty and other emerging economic risks including inflation; the estimated expected reduction in Retained Business Rates and New Homes Bonus funding over the Medium-Term Finance Plan period, and the other reserve movements as set out in Annexe 6.

Reason: The General Fund Budget is a major decision for the Council and setting a balanced budget is a statutory requirement. Scrutiny of these MTFP and Budget proposals demonstrate transparency and good governance. As a result of the sudden and unexpected Covid-19 impact, the Council had to act quickly in mid-2020 to take steps to address the significant projected net General Fund Budget shortfall so that the Council can continue to function. A revised budget for 2020/21 was set in August 2020 and the medium-term financial projections were updated in February 2021 alongside the budget setting report for 2021/22. Despite a very welcome - but one-off - respite in 2022/23 from the continuing decline in central funding, the latest MTFP for the subsequent years ending 2025/26 continues to project future financial pressures, and opportunities, to enable the Council to take action to ensure sufficient funding is in place to deliver services.

[This matter is recommended to Council for decision and is not subject to the call-in procedure.]

The Portfolio Holder for Finance, Commercial and Assets gave a detailed presentation on the report which set out the proposed budget for 2022/23 and highlighted the key areas for the Executive to consider. He gave an overview of the financial pressures on the Council including the threat of inflation rises, the National Insurance levy and the decrease in amount of business rates the Council was able to retain. In light of the uncertainty, it was proposed that the covid recovery earmarked reserves be retained and repurposed as an inflation and economic risk reserve. The financial impact had been mitigated for one year only through the receipt of one-off New Homes Bonus funding and a smaller services grant. He gave an overview of the measures proposed to offset the financial pressures on the Council, including car park utilisation and the ongoing Guildford collaboration. Despite these measures, it was still necessary to propose a £5 increase in council tax and it was recognised that this would be a financial burden on residents. Therefore, to mitigate the impact on the most vulnerable, it was proposed to continue the Council’s existing Council Tax Support Scheme at the current levels and to not implement a blanket increase to fees and charges. Further sustainable measures would be identified to balance the budget for future years and deliver services to residents. He thanked the officers for their dedication and to all Councillors who had submitted constructive feedback as part of the consultation process.

The Leader echoed the thanks to the officers for responding to a large number of comments and questions on the draft budget.

Councillor Jerry Hyman spoke on the item, questioning the wording of the recommended increase in council tax and whether it should be expressed as a percentage. He sought clarification on whether there should be a schedule of rises for consideration and whether recommendation 3 should be a Council decision rather than a delegation.

In response, the Leader advised that the Council tax bands are set in legislation. The Strategic Director (s151 Officer) confirmed that the percentages were the same through all the bands and that there would be a separate technical report on Council Tax on the agenda for the Council meeting on 22 February.

Councillor Mulliner spoke on the proposal to publicise the individual allocations from the Thriving Communities Fund after the Council meeting had agreed the budget which he felt was not transparent. He expressed concern over the reduction in funding to Citizen’s Advice and the impact this would have on residents. He urged the Executive to consider £60k in support.

In response, the Leader advised that Town and Parish Councils have Service Level Agreements with Citizen’s Advice, and therefore these would need to be renegotiated. It was noted that Citizen’s Advice had received other sources of funding, including from Surrey County Council. Clarification would be provided on when the figures would be made known and a meeting would be held with the CEO of Citizen’s Advice to clarify the funding. Councillor Mirylees clarified the process for considering allocations for funding and the requests made of Citizen’s Advice to ensure that support was targeted to those in need. Councillor Merryweather advised that there was a Service Level Agreement with Citizen’s Advice and therefore there were contractual obligations as part of that.

Councillor Goodridge also spoke about the proposed reduction in funding to Citizen’s Advice the impact that cut would have. He was not aware of any other sources of funding and would welcome clarification after the meeting.

Councillor Townsend clarified that further funding would be available to Citizen’s Advice from Surrey County Council and that officers were supporting Citizen’s Advice to reorganise themselves to best meet the needs of residents. Councillor Merryweather acknowledged that any change was difficult and there were demands on all organisations to meet needs with dwindling resources, through no fault of the organisation in question. However he reminded the Executive that the decision was for the allocation of a budget to the Thriving Communities fund and how that fund was allocated was not for consideration.