Agenda item

Report of the Director of Finance, People and Estates (Treasurer) and Chief Fire Officer (RC/22/1) attached.

The Committee considered a joint report of the Director of Finance, People & Estates (Treasurer) and the Chief Fire Officer (RC/22/1) 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 £75,995,900; 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 £77,151,300 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.

The Treasurer gave an update at the meeting on the Net Budget Requirement given that the Authority had now received the final returns on the National Non Domestic Rates (NNDR) and details of the share of the Council Tax Collection Funds from billing authorities. This had resulted in a change to the Net Budget Requirement set out above of £76.182m for Option A; and, £77.289m for Option B. The Treasurer emphasised that this took account of £0.641m of savings that had been identified as a result of a reduction in non-operational budget lines

The Net Budget Requirement of £77.289m for Option B was designed to support Service reform by increasing the total investment for the Pay for Availability system to £2.774m. Should budget option A be selected, then the net spending requirement exceeded available funding by £1.106m. This shortfall could be met by a transfer from general reserves (budget smoothing) of £1.011m, with the remaining £0.095m being met from a reduction in the revenue contribution to capital. This would, though, exhaust fully the budget smoothing reserve.

The Medium Term Financial Plan identified a requirement for further budget savings in 2023-24 of £4.5m (Option A - Council Tax freeze) or £2.3m (Option B - 1.99% Council Tax increase), rising to £9.5m (Option A) or £7.3m (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.

RESOLVED that the Authority be recommended:

(a).  to set the level of Council Tax in 2022-23 for a Band D property at £91.79, as outlined above, 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;

(b).  that, as a consequence of this:

(i).     the tax base for payment purposes and the precept required from each billing authority for payment of a total precept of £56,708,737, as set out in the revised figures above (Option B) be approved;

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

(c).   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 the report, be endorsed.