Issue - meetings

Report of the Interim Section 151 Officer attached.

Decision made (Unanimously):

1.    That Cabinet recommends to Council the revenue budget for 2020/21 as set out in Appendix A.

2.    That Cabinet recommends to Council the 4-year Medium Term Financial Strategy (MTFS) 2020/21 to 2023/24 as set out in Appendix A.

3.    That Cabinet recommends to Council a Council Tax increase of 1.99%.

4.    That Cabinet recommends to Council the Capital Strategy and its proposed funding as set out in Appendix C.

5.    That Council be recommended to approve the Treasury Strategy, Prudential Indicators and the Annual Investment Strategy as attached at Appendix D.

6.    That Cabinet note that consultation on the proposed budget commenced after publication of the budget report on 4 February and the results will be analysed and taken into consideration before the budget is taken to Council for approval on 26 February 2020.

The Cabinet Member for Finance, Property and Assets, Councillor Matthew Tomlinson presented the proposed 2020/21 Revenue Budget for Council and the Medium-Term Financial Strategy for the next four years and sought approval and recommendation to Council on various elements.

The financial plan for the Council aligned with the Corporate Plan which sets out the Council’s ambitions and priorities for the residents and businesses in the borough.

Councillor Damian Bretherton raised concerns about the increasing ratio (5% in 2020/21 to 12.4% in 2023/24) which reflects the additional level of borrowing required to finance the Council’s planned Capital Programme. The Interim Section 151 Officer advised that the increase represented the funding costs but that no account was taken in the ratios of any income generated from that expenditure. It is anticipated that revenue generated would cover the increase in costs. Assumptions, including interest rate fluctuation, had been considered in the report.

Decision made (Unanimously):

1.    That Cabinet recommends to Council the revenue budget for 2020/21 as set out in Appendix A.

2.    That Cabinet recommends to Council the 4-year Medium Term Financial Strategy (MTFS) 2020/21 to 2023/24 as set out in Appendix A.

3.    That Cabinet recommends to Council a Council Tax increase of 1.99%.

4.    That Cabinet recommends to Council the Capital Strategy and its proposed funding as set out in Appendix C.

5.    That Council be recommended to approve the Treasury Strategy, Prudential Indicators and the Annual Investment Strategy as attached at Appendix D.

6.    That Cabinet note that consultation on the proposed budget commenced after publication of the budget report on 4 February and the results will be analysed and taken into consideration before the budget is taken to Council for approval on 26 February 2020.

Reason(s) for the decision:

It is the role of the Cabinet to provide initial consideration to the budget and associated matters and for them to make appropriate recommendations to Full Council which is the decision-making body.

Alternative Options Considered and Rejected:

1. In preparing the revised forecasts, the potential for a reduction in core funding as a result of the government’s planned Fair Funding formula review and possible Business Rates Reset has been considered. However, as it is not possible to assess the implications at this stage with any certainty, the business rates retention forecasts in the MTFS for 2021/22 onwards have been prepared based on the funding regime in the 2020/21 Finance Settlement and the council continuing to benefit from being in the Lancashire business rates pool.
2. When the funding changes are announced, the financial implications and the impact on the council’s MTFS forecasts will be assessed and reported. It is possible that any changes introduced may include transitional arrangements to lessen the impact of any reduction in funding and allow local authorities to adjust future spending. The Business Rates Retention reserve has also been maintained to mitigate the impact of any significant movements in forecasts.