Agenda item

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 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.

Reasons:

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. The impacts of macroeconomic conditions and government policies are reflected in this budget proposal:

·       on the demand side, the cost-of-living crisis is increasing residents’ demands for our services while affecting their ability to pay for them;

·       supply side cost inflation is driving up the costs of maintaining our existing services “as is”.  The higher costs for supplies, labour and capital also affect the delivery of new investment projects, including those that have revenue benefits;

·       structural conditions in the skilled labour market affect our ability to retain and recruit permanent staff at any price, and

·       government control and regulation over our funding streams – be they direct or indirect – continue to limit our ability to take measures to address or our core structural deficit.

While the council has managed to respond to these challenges in recent years, the latest MTFP for the years ending 2027/28 continues to project future financial pressures. The council is taking action to ensure sufficient funding is in place to deliver and maintain services for 2024/25 but this report explains the conditions and uncertainties that threaten its ability to continue to do so for the following years.