Agenda item

To receive the report of the Director, Finance and Digital Services, which provides the Cabinet with information in respect of the 2021/2022 local government settlement and the outcomes of the budget consultation phase 1 exercise, to assist with its deliberations in formulating the revenue budget strategy for the financial year 2021/22, which it will recommend to Council, for approval.

The Director, Finance and Digital Services provided the Cabinet with information in respect of the 2021/22 local government settlement and the outcomes of the budget consultation phase 1 exercise, to assist with its deliberations in formulating the revenue budget strategy for the financial year 2021/22, which it will recommend to Council, for approval.

The Director referred the Cabinet to the discussion paper prepared by the Senior Leadership Team in response to the 2021/22 local government settlement, which was attached at Appendix A to the report.

The Director reported that the Council’s General Fund Balances currently amounted to £8.709M and remained of the view that the Council should hold a minimum of £10M as General Fund Balances. The Director noted that during the last financial year, the reserves were used to support residents and businesses in the immediate aftermath of Storm Dennis, which is the appropriate purpose; and was satisfied that plans had been put in place to replenish General Fund Reserves to the minimum level over the period of our Medium Term Financial Plan (at £0.5M per year for the next 3 years). The Director went onto speak of the Council’s Transition Funding Reserve, which currently stood at £4.330M, and for many years, had been used sensibly as part of the balanced budget strategy.

The Director referred the Cabinet to Section 3 of the report and informed Members of the key points of the 2021/22 Provisional 2021/22 Local Government Settlement, which was announced on 22^nd December 2020.

In respect of setting the level of Council Tax, the Director spoke of targeting adequate funding towards the delivery of key services whilst, at the same time, ensuring that the resultant Council Tax levied next year is reasonable and can be justified to residents. Members noted that the original modelled proposal was to increase Council Tax in 2021/2022 by 2.85%, but it was proposed that Council Tax be increased by 2.65% instead, which would increase the remaining budget gap by £182,000.

In respect of the Schools Budget, the Director proposed an increase of £2.2M from £161.6M to £163.8M to cover, in full, all inflationary and pupil number pressures, including NDR increased costs. 

The Director provided detail into the following proposals detailed at Section 9 of the report, which would seek to protect front line services and to prioritise or reallocate resources to areas of priority:

·         NDR Local Relief Scheme  

·         Car Park Charges

·         Climate Change and Carbon Reduction

·         Graduates

·         Wellbeing Support

·         Fees and Charges

·         Public Health and Protection Services – Additional Resources

·         Flood Prevention Support

·         Overgrowth Team

The Director continued by informing the Cabinet of the feedback from Phase 1 of the consultation process, which sought the views of the Finance and Performance Scrutiny Committee, the School Budget Forum, residents and stakeholders and concluded by informing the Cabinet that should they be minded to approve the proposals before them, Phase 2 of the consultation would commence with immediate effect. The draft Budget Strategy would be presented to Cabinet for approval on 25th February 2021 and then to Council for ratification on 10th March 2021.

The Leader took the opportunity to thank the Senior Leadership Team, finance officers and service managers for the robust report and a budget with no cuts and potentially the lowest Council Tax increase in Wales. Referring to the Phase 1 consultation feedback, the Leader advised that there had been significant support from residents in terms of the investment priorities and that 77% had supported the initial proposed Council Tax increase of 2.85%.

The Leader spoke of the various investment priorities detailed within the report for key areas such as public health, wellbeing and flood prevention support, along with the proposed freeze of charges on Leisure for Life, Car Park fees, Summer and Winter Playing Fees, school meals, bereavement fees and the Lido and Rhondda Heritage Park.

The Deputy Leader commended officers for the positive report and acknowledged that efficiency savings become more difficult year on year, particularly given the impact of the Covid-19 pandemic and Storm Dennis.

The Cabinet Member for Corporate Services agreed with the Director that it had been essential to use a portion of the General Fund Reserves and was pleased to note that there was a plan to replenish it over the next three years. The Cabinet Member also agreed with the continued and sensible use of the Council’s Transition Fund Reserve, which he felt complimented the hard work of all departments in making efficiency savings.

The Cabinet Member for Stronger Communities, Well-being & Cultural Services welcomed the additional investment included within the proposed budget in respect of Climate Change and Carbon Reduction, which evidenced the Council’s  commitment to tackling climate change and becoming a carbon neutral Authority by 2030.

The Cabinet RESOLVED:

1.    To note that the procedures relating to revenue budget construction, the budget consultation process, and reporting to Council, are set out in the “Budget and Policy Framework” within the Council’s Constitution;

2.    To note and consider the outcomes of the budget consultation phase 1 process;

3.    The draft 2021/22 Revenue Budget Strategy, detailed in the attached Discussion Paper ‘Appendix A’, as the basis upon which a second phase of consultation will take place;

4.    The draft timetable for setting the 2021/22 revenue budget as set out at Appendix A2;

5.    To receive feedback from the second phase of budget consultation in order to consider and determine the final budget strategy for submission to Council; and

6.    That the Council continues to support the medium term financial strategy aimed at maximising ongoing efficiency in service delivery, targeted service transformation and other changes that maintain the financial integrity of the Council whilst still aiming as much as possible to protect jobs and key services.