Agenda item

Report No: COU/WS/20/005

Council considered the above report, which presented the proposals for Budget and Council Tax Setting in 2020/2021 and the Medium Term Financial Strategy (MTFS) 2020-2024.

 

Councillor Sarah Broughton, Portfolio Holder for Resources and Performance, drew relevant issues to the attention of Council, including that Report No: COU/WS/20/005 provided details of the Council’s proposed revenue and capital budgets for 2020/2021 and in the medium term.  The Cabinet had previously considered the 2020/2021 budget and had recommended to Council the level of council tax required to help fund this budget (as set out in Section 3 of the report and summarised below).

 

West Suffolk Council (and its predecessor councils Forest Heath District and St Edmundsbury Borough Councils) had a good track record of not only delivering high quality services that its communities demanded and value but had a strong vision and programme to deliver, through the West Suffolk Strategic Framework 2020-2024, to bring greater prosperity for its communities and businesses.  This followed the £5 million in annual savings made from shared services, transformation and the creation of the new single council to put the Council on a stronger financial footing.  A common-sense budget meant the Council could continue delivering high quality services, invest in leisure, skills and jobs as well as the health, environment and prosperity of West Suffolk’s people and area, while at the same time reduce the impact of national challenges to local government funding.

 

In the history of local government there had been few times that had seen such a transformation in the funding of local services as the decade just passed. The changes were numerous and continuous, and Members noted that there was little doubt the 2020s would bring even more changes.

 

The report provided examples of those changes and the financial challenges facing the Council.Councils could no longer traditionally just deliver services if they were to meet the financial challenges and be able to continue to serve their communities. The Council recognised and already took a proactive investment role, not only to meet the challenges brought by funding for councils, but also importantly to manage growth and ensure prosperity for its communities. The Council must, therefore, maintain and where appropriate grow the local income it currently received and also deliver the investment projects, enable the building of homes and increase the business base so that new income streams would be delivered to replace those lost. This would enable the Council to continue delivering the services and wider community support which people valued and made West Suffolk an attractive place to live, work and invest.

 

In 2020/2021, the Council’s medium term financial plans would see further reliance on delivery of its strategic projects. Some of the projects required considerable investment, both in money - including creating new funds where needed through borrowing (supported by robust business cases) - resources and time, but that investment would build a more financially resilient and self-sufficient council, with less reliance on uncertain national or other funding. That focus on income-generating projects, which may span several years before they delivered a return, meant the Council no longer looked simply to balance a budget for one year. Importantly, these economic growth projects would bring wider long term benefits to the West Suffolk areas than purely financially robust councils, such as jobs, better health outcomes and investment in working with communities and place based initiatives.

 

Members considered the report in detail, which included the following issues for securing a balanced budget for 2020/2021 and in the medium term to 2023/2024, together with corresponding detailed appendices:

 

Section 2:    Provisional Local Government Finance Settlement, which included reference to the future of New Homes Bonus and business rates relief. Members were specifically asked to support the additional business rate reliefs proposed by the Government to facilitate delivery of the Council’s ambition to support its town centres and high streets in West Suffolk, as set out in paragraphs 2.8 to 2.10.   

 

Section 3:    Council tax for 2020/2021

Section 4:    Setting the budget – 2020/2021 and across the medium term to 2023/2024

Section 5:    Capital programme 2020-2024 (including disposal of surplus assets)

Section 6:    Minimum Revenue Provision (MRP)

Section 7:    General Fund Balance

Section 8:    Earmarked reserves

Section 9:    Strategic priorities and MTFS Reserve

Section 10: Adequacy of reserves

Section 11: Calculation of the council tax

Section 12: Legal implications

 

Particular attention was given to the Budget Challenge workshops held between August and December 2019 and the Performance and Audit Scrutiny Committee’s consideration and recommendation of budget proposals for achieving a balanced budget, as presented to them in November 2019 and January 2020 and as set out in Section 4. These in turn had been supported by the Cabinet (see Referrals Report of Recommendations from Cabinet Report No: COU/WS//20/002).

 

Having acknowledged the issues highlighted above, the Council noted the position summarised in Sections 1. to 12. of the report for securing a balanced budget for 2020/2021 and over the medium term to 2023/2024. This was based on the option to harmonise the two predecessor areas (St Edmundsbury and Forest Heath) using the average Band D rate across both predecessor areas, harmonising the council tax bills by 2022/2023 whilst maximising its council tax receipts to protect services and to support its investment plans. For 2020/2021 this represented an average Band D monthly increase of 97p and 14p for the predecessor areas of Forest Heath and St Edmundsbury respectively. Members noted that just over 70% of West Suffolk Council’s residents were located in Bands A to C so would actually see a lower increase. Members also noted that the level of council tax beyond 2021 would be set in accordance with the annual budget process for the relevant financial year.

 

Councillor Broughton commended the finance team and the Performance and Audit Scrutiny Committees, together with staff and other Members across the authority for their work in securing a balanced budget for 2020/2021 and for the medium term.

 

Councillor Broughton then moved the recommendations, as set out in Report No: COU/WS/20/005, and the motion was duly seconded by Councillor Sara Mildmay-White.

 

A detailed debate ensued with several Members acknowledging that despite the financial challenges being faced, the Council had made, and were continuing to make, successful investments in services; growth and health and well-being projects; together with creating efficiencies, resilience and ensuring the effective management of resources, all of which and more had enabled West Suffolk Council to secure a balanced budget for 2020/2021.

 

As referred to above, in respect of the Government’s announcement that additional business rates measures would apply from 1 April 2020, which would:

 

a.       increase the current retail discount and extend that discount to cinemas and music venues;

b.       extend the duration of the local newspapers office space discount; and

c.       introduce an additional discount for public houses;

 

these were supported by the majority of Members. 

 

Some Members wished to ascertain a greater understanding of the proposal to harmonise council tax of the predecessor authorities by 2022/2023 when it had originally been modelled for harmonisation to take place over seven years, particularly as these Members felt this could cause some confusion and angst for residents of the former Forest Heath area.  In response, Council was informed that the Order which had enabled the creation of West Suffolk Council from 1 April 2019 allowed harmonisation to take place over seven years; however, it was now the decision of the new Council to determine whether harmonisation should take place sooner. In considering securing a balanced budget and for enabling the Council to be in a better financial position in the medium to longer term, it was now considered prudent to harmonise council tax by 2022/2023.

 

Other issues raised included future environmental impact considerations; car parking charges; ways in which to communicate to the public which council was responsible for which service and how their council tax was broken down between the various precepting authorities; the cost and benefits of, and the appetite for borrowing; the status of the Western Way Development and Mildenhall hubs which were not meant to be commercial enterprises and generate an income but were designed to break even; and the breakdown of the Council’s reserves.   

 

The majority of Members supported the proposed budget and level of council tax for 2020/2021 and expressed their positivity towards looking forward to the future of the new West Suffolk Council.

 

The motion was then put to the statutorily required recorded vote.  With 52 Members present, the votes recorded were 40 votes for the motion, 12 against, and no abstentions; the names of those Members voting for and against being recorded as follows:

 

For the motion:

Councillors Augustine, Broughton, Simon Brown, Bull, Burns, Chester, Chung, Clements, Cole, Frost, Glossop, Hanlon, Harvey, Hind, Beccy Hopfensperger, Houlder, Lay, Luccarini, Marks, Mason, McManus, Miekle, Mildmay-White, Nettleton, Nobbs, Rayner, Richardson, Roach, Rout, Rushbrook, Shipp, Andrew Smith, David Smith, Soons, Springett, Stevens, Thompson, Thorndyke, Waterman and Williamson.

 

Against the motion:

Councillors Alecock, Anderson, Beckwith, Bradshaw, Dawn Dicker, Roger Dicker, Lukaniuk, Neal, Palmer, John Smith, Waldron and Wittam.

 

Abstentions:

None

 

It was therefore

 

RESOLVED:

 

That:

 

1.       Having taken into account the information received by Cabinet on 11 February 2020 (Report No: CAB/WS/20/025 refers) including the Report by the Assistant Director (Resources and Performance) (s.151 Officer) set out in Attachment C, together with the up to date information and advice contained in this report (Report No: COU/WS/20/005), the level of Band D Council Tax for 2020/2021 be set at £163.98 for the predecessor area of Forest Heath, and £183.78 for the predecessor area of St Edmundsbury. (Note: the level of council tax beyond 2020/21 will be set in accordance with the annual budget process for the relevant financial year.)

 

2.       Subject to 1. above, the following formal Council Tax resolutions be adopted:

 

a.       The revenue and capital budget for 2020-2024, including authority for the s.151 Officer to approve any flexibility required to the capital budgets set out in paragraphs 5.5 and 5.8 of Report No: COU/WS/20/005, attached at Attachment A and as detailed in Attachment D (Appendices 1-5), Attachment E (Appendices 1-3) and Attachment F, be approved;

 

b.       a general fund balance of £5 million be agreed to be maintained, as detailed in paragraph 7.2;

 

c.       the statutory calculations under Section 30 to 36 of the Local Government Finance Act 1992, attached at Attachment I, be noted;

 

d.       the Suffolk County Council and Suffolk Police Authority precepts issued to West Suffolk Council, in accordance with Section 40 of the Local Government Finance Act 1992 and outlined at paragraphs 11.6 and 11.7 below, 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 H be agreed as the amount of Council Tax for the year 2020/2021 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 from the 2019/20 revenue budget to the Invest to Save Reserve, as detailed in paragraph 7.4 of Report No: COU/WS/20/005, and to vire funds between existing Earmarked Reserves (as set out at Attachment D, Appendix 3) as deemed appropriate throughout the medium term financial planning period.

 

4.       Approval be given to the additional business rate reliefs set out in paragraphs 2.8 to 2.10 of Report No: COU/WS/20/005, in support of the business community, in particular the town centres and high streets in West Suffolk.

 

5.       Approval be given to the Flexible Use of Capital Receipts Strategy as set out in Attachment G.