Agenda item

A report from the Leader of the Council and Cabinet Member for Finance and Growth is attached.

Councillor Eamonn O’Brien, Leader of the Council and Cabinet Member for Finance and Growth, presented the report which set out the key elements of the 2021/22 budget proposals and the framework for the longer term Medium Term Financial Strategy (MTFS) 2021 – 2025.

The Leader advised of the significant cost pressures of £46m from an increase in demand and loss of income, which had only been partially reimbursed by the £36m in Government support. The impact of Covid would continue, leaving a £45m gap over the next two years, up from £11.5m pre-Covid. One-off pressures could be addressed through the use of reserves, but ongoing pressures needed to be addressed through budget cuts. These were difficult proposals but set out the scale of the challenge and the scope of proposals to address them.

In response to a Member’s question, the Leader advised that Business Rate growth assumptions were based on a reasonable return to the growth as seen previously. There had been an impact on the Business Rate base but Bury had seen a strong economy in the past and the Council was working closely with businesses to understand the impact on them and provide support. The Leader also advised that the situation would be reviewed regularly to ensure the Council remained flexible.

With regards to waste disposal, Councillor Alan Quinn, Cabinet Member for Environment and Climate Change advised there were no plans for bin reductions and that a focus on education to improve the use of bins and quality of recyclable materials had the potential to make significant savings.

In response to further Member questions, Councillor Quinn advised he would report back on the percentage of green energy used in Council’s estate. He reported that that the decarbonisation timescales were very tight, necessitating a huge amount of work for officers to have the scheme up and running by September. With regards to boilers, Councillor Tahir Rafiq, Cabinet Member for Corporate Affairs and HR, advised that the Town Hall boilers were being addressed through different means and Councillor Quinn advised that gas boilers would require replacing or retuning and electric boilers were being installed in all brownfield site developments.

Decision:

·       To approve the medium-term financial strategy and the assumptions regarding resources and spending requirements;

·       To note the Council Tax base at 53,828 on which the Council Tax funding has been calculated as approved by Cabinet in December 2020;

·       To approve the net revenue budget of £169.247m for 2021/22 and note that this includes an assumed increase in the council tax of 1.99%;

·       To note the further option of a 3% social care levy and that this is not reflected the strategy;

·       To approve the permanent spending allocations of £25.211m in 2021/22;

·       To note the budget gap of £20.388m in 2021/22;

·       To approve the budget reductions of £21.898m over the 4 years of which £8.056m applies to the 2021/22 financial year;

·       To approve the use of reserves of £12.332m in 2021/22 and note the planned use of reserves of £14.355m in 2022/23;

·       To note the forecast position on reserves;

·       To note the Directorate cash limits;

·       To note the significant financial risks for funding, income and demand pressures in future years and for the impact of Covid to impact on the strategy.

Reasons for the decision:

To progress the Council’s 2021/22 budget setting process to achieve an approved budget.

Other options considered and rejected:

None, setting the budget is a statutory responsibility.