Issue - meetings
Medium Term Financial Strategy and Budget 2022/23
Meeting: 13/01/2022 - Corporate Resources Overview & Scrutiny Committee (Item 71)
71 Medium Term Financial Strategy and Budget 2022/23 PDF 74 KB
- Enc. 1 - Cabinet report, item 71 PDF 130 KB
- Webcast for Medium Term Financial Strategy and Budget 2022/23
That having considered the Medium Term Financial Strategy and Budget 2022/23 report, the Committee wishes to feedback to Cabinet its acknowledgement of the indicative allocations and disappointment at Welsh Government not considering a supplementary allocation towards national pay awards and the Real Living Wage.
The Corporate Finance Manager introduced a report to update the Committee on the key headlines and financial impacts of the Welsh Local Government Provisional Settlement announced in December, in advance of the Council’s formal budget setting process in February.
The provisional aggregate external finance (AEF) for 2022/23 was a 9.2% increase on the adjusted AEF for 2021/22 - slightly below the all Wales average increase of 9.4%. This represented a cash uplift of £25.396m from 2021/22 but did not take account of the North Wales Regional Waste Treatment Project gate fees and Social Care Workforce Grant, both of which were previously received via specific grants. In addition, there was an expectation to meet in full the impacts of all pay awards and the Real Living Wage as well as ongoing risks such as Out of County Placements and continued extra costs and lost income arising from the pandemic following the cessation of the Welsh Government (WG) Hardship Fund at the end of this financial year.
These additional pressures would significantly increase the overall additional budget requirement previously reported, which had been based on the minimum level and below in-year demand levels. Once work was complete on reviewing all additional cost pressures, a legal and balanced budget for 2022/23 would need to be recommended by Cabinet to Council in February. Building resilience into reserves would be a key consideration of budget setting for 2022/23 and for the Medium Term Finance Strategy, particularly given the challenging indicative allocations for the next two years.
In thanking officers for the report, Councillor Paul Shotton welcomed the increased Settlement but recognised that indicative future allocations, rising living costs and Flintshire’s funding position in Wales reinforced the importance of continued discussions with the Welsh Local Government Association (WLGA) to make the case for fairer funding.
In response, the Chief Executive said that Flintshire’s allocation below the Welsh average and its ranking as 20th out of 22 Councils in Wales on funding per capita was an ongoing concern. On the removal of the additional funding floor, which aimed to protect Councils falling well below the Welsh average, the Corporate Finance Manager said that the decision by WG had possibly been influenced by the Settlement.
Councillor Ian Roberts also welcomed the increase in the Settlement but said that the Council’s current budget projections would need to take account of a number of significant pressures that had not yet been concluded. He referred to the wider impact of outcomes on teachers’ pay awards and the Real Living Wage and reiterated the need for national pay agreements to be fully funded.
When asked by Councillor Sean Bibby about comparison of allocations given to neighbouring authorities, officers explained that the report was based on the average across North Wales which was similar to the national average and that the inequality of funding in Wales was being raised at Ministerial level.
Councillor Paul Johnson spoke about the wider impacts of inflation and the need for careful consideration of the 2022/23 budget ... view the full minutes text for item 71