Agenda item

Council Fund Revenue Budget 2021/22 - Final Closing Stage

Decision:

(1) That Council notes and approves the revised budget requirement for 2021/22;

(2) That Council approves the final proposals for the corporate efficiencies which will contribute to the budget;

(3) That Council approves a legal and balanced budget based on the calculations as set out in the report;

(4) That Council notes the open risks which remain to be managed in the course of 2021/22;

(5) That Council approves an annual increase in Council Tax for 2021/22 of 3.95%; and

(6) That Council notes the medium-term forecast as a basis for the next revision of the Medium-Term Financial Strategy (MTFS).

RESOLVED:

(a) That the recommendations of Cabinet, as detailed above, for balancing the budget for 2021/22 be approved; and

(b) That the level of Council Tax for 2021/22 as recommended by Cabinet be approved.

Minutes:

The Chief Executive introduced a report to receive the recommendations from Cabinet for the Council to set a legal and balanced Council Fund Revenue Budget for 2021/22.

The Chief Executive, Corporate Finance Manager and Revenues Manager gave a presentation covering the following:

· Setting a legal and balanced budget

· Additional budget requirement 2021/22

· Budget solutions 2021/22

· Council Tax

· Schools and social care budgets

· Open risks

· Earmarked and un-earmarked reserves

· Professional opinions and concluding remarks

· Looking ahead and the Medium Term Financial Strategy (MTFS)

Following an extensive budget consultation process, all outstanding issues had been closed by Cabinet in January. Having been supported by the Corporate Resources Overview & Scrutiny Committee, the recommendations of Cabinet were to balance the budget based on the lower minimum budget requirement with no provision for pay awards other than for employees with salaries under £24k. The Local Government Provisional Settlement announced by Welsh Government (WG) in December represented a cash uplift of £7.392m (3.7%) above the 2020/21 amount and the Council’s formal response set out the views of collective Cabinet and elected Members. The prudent and balanced approach to the budget had proved successful in protecting services, however the scale of the emergency situation had led to significant financial pressures which would continue into 2021/22.

The 3.95% annual increase in Council Tax followed the clear directive set by the Council to maintain an affordable level below 5%. This comprised 3.45% for Council budgets and 0.5% as contributions to regional bodies including the North Wales Fire & Rescue Authority. Additional precepts for the Police & Crime Commissioner (5.14% annual increase) and those for individual Town/Community Councils were detailed in the report.

The recommendations for Cabinet and Council were moved by the Leader of the Council and Cabinet Member for Education, Councillor Ian Roberts, who thanked the Chief Executive and officers for their work throughout the budget-setting process. Whilst recognising the impact from a local increase in Council Tax, he welcomed the protection of Council services and investment in priorities such as schools and Additional Learning Needs (ALN). He also spoke about a number of open risks such as Out of County Placements where the Council had made extra provision in the base budget and called upon WG for nationally held reserve funding.

As Cabinet Member for Finance, Councillor Glyn Banks seconded the proposal and referred to the Council’s response to the Provisional Local Government Settlement from WG that included a repeated call for a review of the local government funding formula.

Councillor Peers acknowledged the challenges in closing the budget gap and protecting services year on year. He raised concerns about the impact of the emergency situation and said that a review of expenditure was needed, with escalating costs for Out of County Placements considered in more detail by Overview & Scrutiny. In response to a question, the Corporate Finance Manager clarified that the Provisional Settlement had fallen short of minimum expectations by around £600k and that subsequent outstanding issues had now been completed and incorporated into the budget.

Councillor Richard Jones spoke in support of the report and thanked the Chief Executive. He said that WG should acknowledge the case for appropriate funding as increasing levels of Council Tax to contribute towards the budget were unsustainable and placed a burden on councils to make difficult decisions. He also said that WG should introduce a three-year funding strategy to assist councils with medium term financial planning.

Also speaking in support was Councillor Tony Sharps who thanked the Leader of the Council for his work on the budget and his commitment to continue to lobby WG for a national solution on Out of County Placements.

As Cabinet Member for Social Services, Councillor Christine Jones said that the Council was exploring options to help with increased demand for Out of County Placements, however, this was a national problem in need of appropriate support from WG.

Councillor Bithell commended the Leader of the Council, Cabinet Member for Finance, the Chief Executive and the Corporate Finance Manager for their joint letter of response to WG which continued to make the case for a change in the funding formula and a national solution on Out of County Placements.

In raising concerns on the risk to future collection levels of Council Tax, Councillor Carol Ellis agreed with the need for appropriate funding from WG. On Out of County Placements, she was informed by the Chief Officer (Social Services) that there had been a 10% increase in demand over the past year which equated to around 20 children. He referred to investment in local solutions and working with partners to help keep families together.

The Chief Executive thanked Members for their continued support. In response to comments, he said that the underlying amount of the Settlement, based on demographic changes, meant that the Council was still amongst the lowest funded in Wales per capita. He agreed with the need for WG to consider the balance between the affordability of Council Tax and national funding and said that regular review and challenge of expenditure had identified nothing further without compromising services. He also spoke about the potential for further pressures on the budget arising from the emergency situation.

Responding to concerns about the risk of Council Tax collection rates, the Revenues Manager gave assurances that the sensitive approach would continue throughout the emergency situation to support residents to meet their payments.

Councillor Ian Roberts said that the Council continued to explore all funding opportunities and he agreed with the need for a three-year funding strategy from Governments. In response to the concerns raised about Out of County Placements, he suggested a seminar for Members to fully understand the educational and social care pressures.

Councillor Hilary McGuill advised that Out of County Placements would also be on the agenda at a forthcoming joint Overview & Scrutiny committee meeting.

Councillor Heesom commended the report and thanked all those involved.

Having been moved and seconded, the recommendations were put to the vote and carried.