Agenda item

Report of the Director of Finance, People & Estates (Treasurer) and the Chief Fire Officer (DSFRA/22/4) attached.

The Committee considered a joint report of the Director of Finance, People & Estates (Treasurer) and the Chief Fire Officer (DSFRA/22/4) on the draft 2022-23 revenue budget and associated Council Tax levels.

Two options were presented, together with an accompanying budget book for each option:

·         Option A: that the level of council tax in 2022-23 for a Band D property be set at £90.00, as outlined in Option A in this report, representing no increase over 2021-22 and representing a Net Revenue Budget Requirement for 2022-23 of £76.182m; or

• Option B: that the level of council tax in 2022-23 for a Band D property be set at £91.79, as outlined in Option B in this report, representing a 1.99% increase over 2021-22 and representing a Net Revenue Budget Requirement for 2022-23 of £77.289m be approved.

A one-year Local Government Finance Settlement had been announced on 17 December 2021. This indicated a Settlement Funding Assessment for the Authority of £22.551m for 2022-23, a 0.88% increase on the settlement for 2021-22 but representing a 23.33% decrease on the settlement for 2015-16. At the same time, the government had announced that the increase in council tax beyond which a local referendum would be required would be limited to 2% for 2022-23. The cost of such a referendum for this Authority was estimated to be in excess of £2.3m.

The Authority had also received a £0.445m share of the Rural Services Delivery Grant for 2022-23 together with £1.1m Section 31 grant funding to reduce the impact of the increase in social costs (National Insurance increases for employers). These sums were included as income in the proposed revenue budget.

A Net Budget Requirement of £77.289m had been identified. This included support for Service reform by increasing the total investment for the Pay for Availability system to £2.774m. Additionally, the Net Budget Requirement reflected:

·         savings of £0.641m identified from scrutiny of non-operational budgets during the budget setting exercise and cashable savings from the Safer Together programme; and

·         a reduction of £0.5m in the revenue contribution to capital.

Option B would enable the Net Budget Requirement to be met without a requirement to use reserves. Should budget option A be selected, however, then the Net Spending Requirement would exceed available funding by £1.106m. This shortfall could be met by a transfer from the budget smoothing reserve, but would exhaust fully that reserve.

The Medium-Term Financial Plan identified a requirement for further budget savings in 2023-24 of £5.7m (Option A - Council Tax freeze) or £3.4m (Option B - 1.99% Council Tax increase), rising to £12.4m (Option A) or £10.1m (Option B) in 2025-26. A strategic approach to delivering required savings was being developed.

As required by Section 65 of the Local Government Finance Act 1992, non-domestic ratepayers had been consulted on proposals for expenditure. Members of the public had also been consulted. The consultation results indicated that:

·         68% of businesses agreed that it was reasonable for the Authority to consider increasing its Council Tax charge for 2022-23, with 10% disagreeing, giving a net agreement of +58%;

• 70% of residents agreed that it was reasonable for the Authority to consider increasing its Council Tax charge for 2022-23, with 8% disagreeing, giving a net agreement of +62%;

Of those agreeing that a Council Tax increase would be reasonable, 45% of businesses and 47% of residents indicated that they would support an increase of 1.99% or above.

Additionally, the consultation results indicated that:

·         64% of businesses and 66% of residents considered the Service provided good value for money; and

• 80% of businesses and 81% of residents were either very or fairly satisfied with the service provided.

Appended to the report was a statement on the robustness of the budget estimates and the adequacy of the levels of reserves and balances, as required by Section 25 of the Local Government Act 2003.

At its budget meeting on 8 February 2022, the Resources Committee had considered the contents of the report and resolved, amongst other things, to recommend that the Authority approve a level of Council Tax in 2022-23 for a Band D property of £91.79, representing a 1.99% increase over 2021-22, to secure the Net Budget Requirement of £77.289m (Minute RC/21/18 refers).

In debating this item, Members raised the issue of support for people experiencing financial difficulties. Officers undertook to explore the possibility of the Service “signposting” sources of financial support/assistance, as required, when undertaking other Service activities (e.g. home fire safety visits).

Following the debate, Councillor Dr. Buchan MOVED, with Councillor Corvid seconding:

“that the Authority approve budget Option A i.e. a freeze on Council Tax at the 2021-22 level (£90.00 for a Band D property) with an associated Net Revenue Budget Requirement of £76.182m”

This Motion was put to the vote and declared LOST, with three votes in support of the Motion but ten against.

Councillor Peart then MOVED, with Councillor Chesterton seconding:

“that the recommendations in report DSFRA/22/4 be approved (i.e. approving the recommendation of the Resources Committee budget meeting for budget Option B, a level of Council Tax for 2022-23 of £91.79 for a Band D property (representing a 1.99% increase over 2021-22) and an associated net revenue budget of £77.289m”

This Motion was put to the vote and declared CARRIED by eleven votes in support of the Motion, with three abstentions, whereupon it was  

RESOLVED

(i).   that, as recommended by the Resources Committee at its budget meeting on 8 February 2022, the level of Council Tax in 2022-23 for a Band D property be set at £91.79, representing a 1.99% increase over 2021-22, and that accordingly, a Net Revenue Budget Requirement for 2022-23 of £77,288,900 be approved;

(ii).  that, as a consequence of (i) above:

(A). the tax base for payment purposes and the precept required from each billing authority for payment of a total precept of £56,708,737 (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). the council tax for each of the property bands A to H associated with the total precept of £56,708,737 (Option B), as detailed on page 3 of the respective budget booklet and reproduced in the following table, be approved:

(iii). that the Treasurer’s Statement on the Robustness of the Budget Estimates and the Adequacy of the Authority Reserve Balances, as set out in Appendix B to report DSFRA/22/4 and attached as Appendix A to these Minutes, be endorsed.

(See also Minutes DSFRA/21/34(a) and DSFRA/21/37 above)