Agenda item

Report from the Cabinet Member for Finance and Transformation attached.

Councillor Sean Thorpe, Cabinet Member for Finance and Transformation, presented the report which detailed the updated budget position over the three years 2025/26 to 2027/28. It was noted that there is a current budget deficit of £34.9 million.

Councillor Mike Smith highlighted there are assumptions within the budget and questioned if the report considered matters such as the national minimum wage, cost of the Phillips touch system and energy prices.

In response Councillor Thorpe, confirmed all are assumptions until implemented. The proposed savings highlighted; the street lighting and parking proposals are likely to draw the most attention however there are other proposals, most of which fall into the other category and more transformative, with little to no impact on residents.

In response to a question regarding what level of reserves is the Council prepared to use Councillor Thorpe confirmed he would be guided by officers. Neil Kissock, Director of Finance confirmed that whilst it would not be possible to get to a position where we are not supported by reserves in February 2025 officers would be seeking this to be as low as possible and ideally £10 Million and below would be a figure that is being focused on. In response to a further question by Councillor Bernstein members were advised that if the reserves figure required was higher would Officers be prepared to sign it off, Neil Kissock Director of Finance advised that it would be subject to the strategy for the following future years and officers would need confidence that the Council would be able to achieve the budget gap over the following years.

Councillor O’Brien confirmed that this emphasises the need for a good three-year settlement to assist with planning.

Decision:

Cabinet:

1. Approved the set of draft revenue budget proposals totalling £9.441m for inclusion in the Cabinet proposals for the setting of the 2025/26 revenue budget to be considered by Council on 19 February 2025.
2. Approved the draft revenue budget proposals where necessary for consultation between 11th November – 23rd December.
3. Noted that the outcomes of the budget consultation will be reported back to Members and used to inform the budget setting proposals and referred to Overview & Scrutiny Committee for their consideration.
4. Noted the remaining budget gap of £22.327m over the three years 2025/26 to 2027/28.
5. Noted the forecast reserves balances over the three years 2025/26 to 2027/28.

Reasons for recommendation(s)

• The Council has a legal requirement annually to set a balanced budget and Council Tax and where necessary undertake consultation with the public, businesses, stakeholders and internally with staff and through Overview & Scrutiny Committee.
• To update members on the Councils budgetary position and set out the work plan to reduce the forecast budget gap ahead of Budget Council on 19 February 2025.

Alternative options considered and rejected:

The current assumption within the MTFS is for an on-going 4.99% annual Council Tax increase (2.99% general precept and 2% adult social care precept). An alternative option could be made to increase its ‘relevant basic amount of council tax’ above the levels that will be set out in the 2025/26 Local Government Finance Settlement published later in the year, but this would require holding a local referendum and a majority vote. A 1% increase or decrease in Council Tax is the equivalent to c£1m.