Agenda item

Report No: COU/SE/17/004

Council considered Report No: COU/SE/17/004, which presented the proposals for Budget and Council Tax Setting in 2017/2018 and the Medium Term Financial Strategy 2017-2021.

Councillor Ian Houlder, Portfolio Holder for Resources and Performance drew relevant issues to the attention of Council, including that Report No: COU/SE/17/004 set out details of the Council’s proposed revenue and capital budgets for 2017/2018.  The Cabinet had been required to consider the 2017/2018 budget for the authority and had recommended to Council a proposed council tax increase of 1.96%.  This equated to an increase in £3.51 for an average Band D property, therefore the level of Band D council tax for 2017/2018 would be set at £182.16.

In light of the significant transformation in the funding of local services, the Council continued to face considerable financial challenges in the short, medium and longer term.  Changes included reductions in Government grant funding, including the pending removal of the Revenue Support Grant which was expected not to be available to the Borough by 2019/2020; more business rates being retained locally (and the uncertainty around how that was going to work); plus the introduction, and then reduction of New Homes Bonus.  Further details and the implications of these particular matters were detailed in the report. 

Alongside these cuts, was the lowest bank base rate for years (resulting in the Council’s income from interest being significantly reduced), and increased demand in some services, such as housing.  Whilst the Government had maintained the 2% or £5 threshold (whichever was the higher) for council tax increases for 2017/2018 for shire districts, this local tax raised only one fifth of the Council’s income for local services.  Bridging the gap between income and demand was the single biggest challenge facing local government across the country.

St Edmundsbury Borough Council had been working in partnership with Forest Heath District Council (the West Suffolk councils) since 2010 and had saved in excess of £4 million annually through sharing services; however it was recognised that whilst the income received by the West Suffolk councils must be maintained, projects in which investment had been made, must be delivered in order to bridge the budget gap in the medium to longer term.

Some projects would require considerable investment through borrowing, but that investment would build a more financially resilient and self-sufficient council, with less reliance on uncertain Government, or other funding.  That focus on income-generating projects, which may span several years before making any returns, meant that the Council was unable to simply balance a budget for one year.  Section 1.6 of the report provided details on how the Council intended to support these projects and its investment in growth agenda.

The Council Tax Freeze Grant, which incentivised councils to freeze their council tax levels had not been included in the settlement since 2016/2017 onwards and any previous awards were now included within the Revenue Support Grant and phased out accordingly.

Councillor Houlder continued and thanked Members of the Performance and Audit Scrutiny Committee for their scrutiny of a number of proposals that had been worked on to bridge the budget gap for 2017/2018 and in the medium term up to 2021.   All staff and Members alike were then commended for showing commitment to the significant transformation in the way in which the Council now operated and the achievements made as the Council strived towards local self-sufficiency.

Councillor Houlder then moved the recommendations contained in the report, which were duly seconded by Councillor John Griffiths, Leader of the Council.

Councillor David Nettleton proposed an amendment to the substantive motion, which was duly seconded by Councillor Trevor Beckwith.  The amendment sought for Council Tax for an average Band D property to be set at £180.00 (an increase of 0.76% instead of the proposed 1.96%). Given the prediction of 36,257 Band D homes, Councillor Nettleton had calculated the overall impact of his proposal as £78,315.  To achieve a balancing figure, Councillor Nettleton proposed The Apex subsidy should be reduced by £78,315 from £981,963 to £903,648. Councillor Nettleton considered ticket sales could be modestly increased to off-set his proposed reduction in subsidy.

Following Councillor Nettleton’s speech and further explanation of his proposed amendment, a debate was held on the amendment. Bearing in mind the significant number of issues required to be considered in order to achieve a balanced budget,  the majority of Members considered Councillor Nettleton’s proposal was relatively minor in this context and that it would potentially cost more to change the budget at this very late stage, than the amount of savings Councillor Nettleton anticipated would be made. 

The amendment to the substantive motion was then put to the vote and was defeated. 

The debate then turned to the substantive motion.  The majority of Members supported the budget for 2017/2018 and acknowledged that given the financial pressures, uncertainties and challenges placed upon the Council by Central Government, a significant amount of hard work had been undertaken by staff and Members to achieve a sustainable budget and therefore a nominal rise in council tax for 2017/2018 should be supported.

Councillor Griffiths also placed on record his congratulations to all staff and Members for the 2017/2018 budget.  He highlighted that services continued to be preserved and delivered, and improved where possible; however, given the aforementioned issues facing the Council detailed above, the Council needed to maintain focus on the medium to longer term in order to achieve local self-sufficiency.

The substantive motion was then put to the statutorily required recorded vote.  The votes recorded were 37 votes for the motion, 1 against and 1 abstention.  The names of those Members voting for, against and abstaining being recorded as follows:

For the motion:

Councillors Broughton, Simon Brown, Tony Brown, Bull, Burns, Chung, Clements, Crooks, Everitt, Farthing, Fox, Glossop, Griffiths, Hailstone, Hind, Beccy Hopfensperger, Paul Hopfensperger, Houlder, Marks, Betty McLatchy, Ivor McLatchy, Mildmay-White, Pollington, Pugh, Rayner, Richardson, Roach, Robbins, Rushen, Smith, Springett, Stamp, Stevens, Thompson, Thorndyke, Wakelam and Williams.

Against the motion:

Councillor Beckwith

Abstentions:

Councillor Nettleton 

It was therefore

RESOLVED:

That:

(1)     having taken into account the information received by Cabinet on 7 February 2017 (Report No: CAB/SE/17/009) including the Report by the Assistant Director (Resources and Performance) (s151 Officer) set out in Attachment C, together with the up to date information and advice contained in Report No: COU/SE/17/004, the level of Band D Council Tax for 2017/2018 be set at £182.16.

(2)     Subject to (1) above, the following formal Council Tax resolution be adopted:

(a)     the revenue and capital budget for 2017-2021 attached at Attachment A to Report No: COU/SE/17/004, and as detailed in Attachment D, Appendix 1-5 and Attachment E, be approved;

(b)     a general fund balance of £3 million be agreed to be maintained, as detailed in paragraph 1.11.2 of Report No: COU/SE/17/004;

(c)     the statutory calculations under Section 30 to 36 of the Local Government Finance Act 1992, attached as Attachment G, be noted;

(d)     the Suffolk County Council and Suffolk Police Authority precepts issued to St Edmundsbury Borough Council, in accordance with Section 40 of the Local Government Finance Act 1992 and outlined at paragraphs 2.5 and 2.6 of Report No: COU/SE/17/004, be noted; and

(e)     in accordance with Section 30(2) of the Local Government Finance Act 1992, the amounts shown in Schedule D of Attachment F be agreed as the amount of Council Tax for the year 2017/2018 for each of the categories of dwellings shown.

(3)     The Assistant Director (Resources and Performance), in consultation with the Portfolio Holder for Resources and Performance, be authorised to transfer any surplus on the 2016/2017 revenue budget to the Invest to Save Reserve as detailed in paragraph 1.11.4 of Report No: COU/SE/17/004, and to vire funds between existing Earmarked Reserves (as set out at Attachment D, Appendix 3) as deemed appropriate throughout the year.

(4)    The Discretionary Business Rates Relief awarded for local newspapers as detailed in paragraphs 1.4.2.1 to 1.4.2.3 to Report No: COU/SE/17/004, be approved.