Agenda item

Report of the Director of Finance & Resourcing and Chief Fire Officer (RC/20/1) attached.

The Committee considered a report of the Director of Finance & Resourcing (Treasurer) (RC/20/1) on options for the Authority’s Revenue Budget and associated Council Tax level in 2020-21. It was a legislative requirement for the Authority to set a balanced budget and determine an associated Council Tax level prior to 1 March each year and this report set out the necessary financial background on which to consider the appropriate way forward.

The Director of Finance & Resourcing (Treasurer) advised that the Council Tax referendum limit had been set by the Minister for Housing and Local Government at 2% for 2020-21, a reduction from 3% in the previous year. The report therefore set out two options for consideration by the Committee in setting the level of Council Tax in 2020-21, namely:

·         Option A – freeze council tax at 2019-20 level (£86.52 for a Band D property); or

·         Option B – increase council tax by 1.99% above 2019-20 (an increase of £1.72 per annum to £88.24 for a Band D property)

The Committee noted that there had been an increase in grant settlement from Government in 2020-21 amounting to an additional £0.272m of funding available to the Authority, an increase of 1.7%.  The Fire sector had requested an increase in Council Tax of £5 per year in 2020-21 and, although this had not been acceded to, the Home Office had acknowledged this input.  The Authority’s share of the Council Tax collection fund surplus had decreased, however, by £0.174m which reflected a slight decline in the collection rates by districts.

Following the decisions taken by the Authority at its meeting on 10 January 2020, there was significant investment proposed for this budget to support reform of the Service with £3.515m (offset by ongoing savings, reduced capital allocation and a one-off use of reserves) included within the revenue budget proposals.  These included:

·                £1.144m for Pay for Availability, the new On Call duty system; assuming that the system will be in place mid-way through the year, ongoing investment will be double the amount;

·                £0.872m for additional staff working on prevention and protection, particularly building safety following the report by Her Majesty’s Inspectorate (HMICFRS) and the Hackitt review (post Grenfell);

·                £0.322m for operational staff to support prevention capability and the matrix model introduced in 2019-20;

·                £0.930m for professional and technical staff which includes investment in Health and Safety, Organisational Development and Fitness to support improvement against HMICFRS findings; and

·                £0.242m for revenue equipment needed to fit out the new Medium Rescue Pumps per the capital programme.

The revised core budget requirement for the Authority emanating from the overall increase in funding was £80.343m (based on Option B, a Council Tax increase of 1.99%) and therefore savings needed to be identified of £1.323m under Option B.  This still left a gap of £1.743m to balance the budget (or £2.8m under Option A).  It was proposed that the revenue contribution to capital would be reduced to £0.557m for Option B (or £1.634m on Option A) in 2020-21 in order to balance the budget, together with a one-off use of reserves  of £1.167m, however, this would have implications for the long term affordability of the Capital Programme.

Councillor Coles MOVED (seconded by Councillor Peart):

“that it be recommended to the Authority that the level of Council Tax in

2020-21 for a Band D property be set at £88.24, as outlined in Option B,

representing a 1.99% increase over 2019-20”.

Upon a vote, (6 for, 0 against, 1 abstention) this was CARRIED.

RESOLVED

(a)        that it be recommended to the Authority that the level of Council Tax in

2020-21 for a Band D property be set at £88.24, as outlined in Option B of report RC/20/1, representing a 1.99% increase over 2019-20;

(b)        that, as a consequence of the decisions at (a) above:

(i)         the tax base for payment purposes and the precept required             from each billing authority for payment of  total precept             54,212,834 (Option B), as detailed on Page 2 of the respective             budget booklet, be approved;

            (ii)        the council tax for each property bands A to H associated with                         the total precept as detailed in the respective budget booklet,                         be approved; and

(iii)       that the Treasurer’s ‘Statement of the Robustness of the                              Budget Estimates and the Adequacy of the Authority                                   Reserve Balances’, as set out at Appendix B to this report, be                         endorsed.