Agenda item

Report of the Director of Finance & Resourcing (Treasurer) and the Chief Fire Officer (DSFRA/21/3) attached.

The Authority considered a joint report of the Director of Finance & Resourcing (Treasurer) and the Chief Fire Officer (DSFRA/21/3) on the proposed 2021-22 revenue budget and associated Council Tax levels.

On 17 December 2020 the provisional local government finance settlement was announced. This was a one year settlement for 2021-22 only. The provisional settlement indicated an increase in Settlement Funding Assessment (SFA) for this Authority of 0.16% over 2020-21 (from £22.319m to £22.354m). This nonetheless represented an overall reduction of 24% from the 2015-16 settlement of £29.413m.

The Authority had also been awarded, for 2021-22, £0.445m as its share of the £85m Rural Services Grant available only to the most sparsely populated rural areas. As part of a suite of measures to support local authorities in off-setting the impacts of the Covid-19 pandemic, the Authority had received grant funding of £0.970m against the increased costs of the Local Council Tax Support Scheme. The proposed revenue budget also included an estimated £2.856 funding as the Authority’s share of National Non-Domestic Rate grants made to businesses because of the pandemic. These Section 31 grants were included as one-off income rather than forming part of the base budget.

The Ministry for Housing, Communities and Local Government announced, for 2021-22, a threshold of 2% for increases in Council Tax beyond which it would be necessary to hold a referendum. The administration costs associated with a referendum for this Authority were estimated to be in excess of £2.3m. Consequently, no proposals for an increase in Council Tax beyond 2% were presented.

Two budgetary options were presented for consideration by the Authority:

·         Option A, representing no increase in Council Tax over 2020-21; and

·         Option B, representing a 1.99% increase in Council Tax over 2020-21 (an increase of £1.74p per annum [15p a month] – from £88.24 to £90.00 for a Band D property).

The Authority was reminded that each 1% increase in Council Tax represented a £0.538m variation on the revenue budget. Both Council Tax options proposed represented a decrease on the overall budget available as a result of the economic impacts of the pandemic on Council Tax base, surplus and business rates income.

 The Core Budget Requirement for 2021-22 (which included provision for pay and inflation and inescapable commitments) had been identified at £72.222m. This was designed to support reform of the Service by:

·         maintaining investment of £1.224m in the Pay for Availability system, representing half the annual cost should all stations take up the new system;

·         £0.415m to fund 12 development firefighter posts to support strategic workforce planning by providing resilience to offset potential retirements from 2022 and increase opportunities for diversity in the workforce; and

·         £0.151m for the introduction of Microsoft 356 to support more efficient ways of working.

The proposed revenue budget exceeded the amount currently available. Consequently, it was proposed that – should Option B be approved – the shortfall would be met from a £0.512m contribution from reserves.

As required by the Local Government Finance Act 1992, non-domestic rate payers had been consulted on expenditure proposals for 2021-22. Additionally, telephone and on-line surveys of businesses and residents had been undertaken. The detailed survey results were appended to the report but in summary the majority of respondents felt it would be reasonable for the Authority to consider increasing its precept for 2021-22, with both businesses and residents expressing satisfaction with the services provided and agreeing that the Service provided value for money.

Also appended to the report was a statement prepared by the Chief Finance Officer in accordance with Section 25 of the Local Government Act 2003 on the robustness of the budget estimates and the adequacy of the level of reserves.

The proposed revenue budget and associated Council Tax levels had been considered by the Resources Committee (budget) meeting on 10 February 2021 which had resolved to recommend that the Authority approve Option B including the additional £0.415m funding for twelve firefighter development posts (Minute RC/38 refers).

RESOLVED

(i).       that, as recommended by the Resources Committee at its meeting 10 February 2021, the level of Council Tax in 2021-22 for a Band D property be set at £90.00, as outlined in Option B of report DSFRA/21/3, representing a 1.99% increase over 2020-21;

(ii).      that, accordingly, a Net Revenue Budget Requirement for 2021-22 of 72.222m be approved;

(iii).    that, as a consequence of the decisions at (i) and (ii) above:

(A).     a tax base for payment purposes of the precept required from each billing authority for payment of a total precept of £54,849,642 (Option B), as detailed on page 3 of the respective budget booklet (circulated separately with the agenda for the meeting) and reproduced in the following table, be approved:

(B).     that the Council Tax for each property band A to H associated with the total precept of £54,849,642 (Option B), as detailed on page 3 of the respective budget booklet and reproduced in the following table, be approved:

(iv).    that £0.415m of funding be made available to fund an additional 12 development firefighter posts;

(v).      that the Treasurer’s “Statement of the Robustness of the Budget Estimates and the Adequacy of the Authority Reserve Balance”, as set out in Appendix C to report DSFRA/21/2 and reproduced at Appendix A to these Minutes, be approved.

(SEE ALSO MINUTE DSFRA/69(c) ABOVE).