Budget 2015/16 and Medium Term Financial Strategy (MTFS) 2024-2025*
Cabinet received a report which formed part of the Council’s formal budget process, as set out within the Constitution and legislative requirements, to set a balanced budget for 2015/16 and medium term financial strategy to 2024/25.
The purpose of the report was to recommend to Council budget proposals for 2015/16 through to 2024/25, in line with the final local government finance settlement for 2015/16 and in advance of some Department for Education specific grants being finalised. The draft Medium Term Financial Strategy (MTFS) had been presented to Cabinet on 19 January and, subject to updated information contained within the report dated 23 February 2015, was the basis for Cabinet to recommend the budget for approval by Council.
The report also provided an update on budget consultation responses received so far, recognising that that the consultation remained open until 2 March and that some meetings with key stakeholder groups were still to take place.
Councillor Seaton, Cabinet Member for Resources, introduced the report and highlighted the main points contained within. This included the analysis on the feedback for the Phase 2 proposals and the recommendations for the Phase 2 proposals and Council Tax. There had also been an additional tabled document circulated to Cabinet which detailed further consultation responses received.
Councillor Seaton also proposed and advised of the following:
· An allocation of £70k from the risk management contingency to cover and assist with implementation of a staff presence at all times within the larger libraries in the city. This would widen the budget gap in future years;
· An increase in the capital sum for street cleansing equipment and litter bins of £200k to enable further investment to be made. This would have a modest impact on the revenue budget in the next year;
· The possible reformation of the Bus Working Group in order to look at the provision of additional bus services, following comments received from the Budget Working Group. No financial commitment to be given to this at the current time;
· The minimum level of financial contingency to be £500k with the additional proposals outlined above ensuring that the Council remained above that threshold;
· The business rate for the power station had been resolved for the 2005 valuation, however the 2010 valuation remained outstanding. There was no impact on the budget.
· The freeze on council tax would continue; and
· The consultation would remain open until 2 March 2015, and further feedback would be reported to Cabinet and Council.
Councillor Serluca, Cabinet Member for City Centre Management Culture and Tourism, provided an overview of the funding issues with regards to the libraries and the services that investment of £45k would enable, including receptionist posts during Open+ hours for the two libraries co-located with schools, Werrington and Orton, in order to support a full range of activities. At Bretton, an additional post to enable all three floors to remain open during Open+ times and at the Central Library a fourth post to meet increasing demand in the largest and busiest library across the network. The investment was ring fenced for these four libraries only, and Open+ would still be in operation in the four invigilated libraries, this being subject to the outcome of the current consultation. It was hoped that the four new roles would enable some of the staff proposed to be at risk to be redeployed. All library users would be invited to take part in consultation on the revisions to the model.
Cabinet debated the report and key points raised and responses to questions included:
· The Cabinet Members, and all involved in relation to the library proposals, were congratulated on the savings that had been made, whilst still extending services;
· The Cabinet Members, particular Councillor Seaton, and all officers involved in the delivery of the budget were congratulated on the work undertaken;
· The inclusion of the priority of delivering health and wellbeing for the city was commended; and
· The introduction of new technology into the libraries needed to be backed up by training opportunities and consideration could be given to putting libraries onto the website, if this was not being considered already.
Councillor Cereste thanked everyone for all their hard work on one of the most difficult budgets ever seen in the authority.
Cabinet considered the report and RESOLVED to:
1. Note the updates on the budget since the Cabinet’s meeting on 19 January including: the announcement of the final Local Government Finance Settlement, the Council decision on 28 January of the Council Tax Support Scheme and the impact on the tax base.
2. Have regard to the consultation feedback received to date and statutory advice detailed in the report when determining the budget recommendations, noting that consultation remains open and further update will be provided at the Cabinet meeting and to the Council meeting.
3. Agree the budget proposals in this report, which include the updates detailed in paragraph 4.1 and additional proposals as agreed at the meeting, be approved and recommended to Council on 4 March 2015, namely:
a) The budget is set in the context of council priorities;
b) The budget for 2015/16 takes note of the budget monitoring position for 2014/15;
c) The revenue budget for 2015/16 and proposed cash limits for 2016/17 to 2024/25 (including investment and savings proposals);
d) The capital programme for 2015/16 and proposed cash limits to 2024/25 and associated capital strategy, treasury management strategy and asset management plan;
e) A council tax freeze in 2015/16 with indicative increases for planning purposes of 2% for 2016/17 to 2024/25;
f) That education funding is spent at the level of funding resources available to both schools and the council in 2015/16 and future estimates to 2024/25;
g) The budget is supported adequately with reserves, provisions and robust budget estimates set in the context of the risks outlined in the report;
h) The proposals for setting fees and charges for 2015/16;
I) To allocate £70,000 from the risk management contingency for 2015/16 to enable the library proposals to be amended to allow a staff presence at all times within the larger libraries across the city, and to assist with the implementation plans (noting that Cabinet will not make a final decision on library options until their meeting of 20thMarch);
J) To increase the capital sum for Street Cleansing by£200,000 in order to enable further investment into making services more efficient and to help keep our city clean; with the capital financing costs in 2015/16 of £4k being met from the risk management contingency, and
K) To maintain the risk management contingency at a minimum level of £500,000.
4. Note the approved and submitted declaration of the deficit on the Collection Fund with regards to business rates for 2014/15 and the business rates forecast for 2015/16.
5. Approve the discretionary retail relief scheme, the discretionary reoccupation relief scheme and the transitional relief scheme for businesses for 2015/16.
6. Have regard for the continuing uncertainty of national public finances and that it may become necessary to amend the budget in year if there are national changes to public spending following the general election in May.
REASONS FOR THE DECISION
The Council must set a lawful and balanced budget.
The Council was required to set a Council Tax for 2015/16 within statutory prescribed timescales and in accordance with the local referendum requirements contained within the Localism Act 2011.
Before setting the level of Council Tax, the Council must have agreed a balanced budget.
ALTERNATIVE OPTIONS CONSIDERED
Budget proposals had been shared with the budget working group over the budget setting period. Some of the options that would have a relatively small financial impact had been rejected by Cabinet. Cabinet rejected these budget proposals on the basis that the proposals would be detrimental to public service delivery or impact on delivery of the council priorities following feedback from the budget conversation undertaken over the past few months.
Cabinet considered alternative council tax levels and for the reasons set out in the report recommend that the offer by government to freeze council tax represented the best value for the residents of Peterborough