The Corporate Finance Manager (and Section 151 Officer) will provide a presentation to the Committee.
Minutes:
The Corporate Finance Manager (and Section 151 Officer) attended the
meeting to provide a presentation on the 2022/23 Annual Budget and an
update on the Medium Term Financial Strategy (MTFS).
Members were advised that the 2022/23 Annual Budget would be fully considered by Cabinet at its meeting on 22 February 2022 in readiness for its final approval at the Extraordinary Council (Tax Setting) meeting on 3 March 2022.
General Fund
In relation to the General Fund, £805k of savings had been identified from the following areas:
Base Budget Review
Neighbourhood Services – deletion of post
Place & Wellbeing – net saving on staffing review
ICT – renegotiation of printing contract
Assets – office rental income
Transformation Team staffing efficiencies
Community and Infrastructure Grants.
Investments
The Council had made investments in two area namely, Community Safety in relation to a Public Space Protection Order and Legal Services to facilitate a revised staffing structure following dissolution of the Shared Legal Service.
Investment Properties
The investment property portfolio had allowed the Council to achieve a net income in excess of £2 million.
Medium Term Financial Strategy
The Strategy covered the next 3 financial years and it had estimated a funding gap of £2.3 million for 2023/24 following a series of annual assumptions as presented.
A raft of measures would be considered to assist with closing the funding gap as follows:
Service Reviews
Annual Review of Fees and Charges
Review of Council Tax Reduction Scheme
Procurement Savings
Consideration of alternative Service Delivery models
Council Tax base and inflation increases
Rationalisation of Council owned properties
Digital Service Transformation efficiencies
Potential use of reserves.
Earmarked Reserves
Earmarked reserves stood at £15.8 million made up from the Business Rates Equalisation Reserve and the Commercial Property Investment Reserve.
Housing Revenue Account (HRA)
The January 2022 Cabinet had agreed a 2022/23 rent increase of 4.1% and Members acknowledged that the 30 Year HRA Business Plan was currently sustainable but did not factor in potential use of reserves to meet decarbonisation costs. (Carbon Net Zero).
Budget savings had amounted to £271k and investments had reached £76k to recruit to Consumer Standards Lead Officer and Maintenance Operative posts.
Following the presentation, Members discussed the value of the Council’s commercial property portfolio and the reasons for market fluctuations in property values. Procurement savings and the preferred use of local companies/contractors was also considered including how organisations could provide social value to the Ashfield District (as part of any contract) in relation to local apprenticeships, employment and community investment. It was agreed that an overview of social value methodology would be helpful for Members going forward.
RESOLVED that
a) the presentation from the Corporate Finance Manager (and Section 151 Officer) on the 2022/23 Annual Budget and the update on the Medium Term Financial Strategy, be received and noted;
b) as a result of (a) above, the following Member comments/observations be forwarded to Cabinet/Council for consideration as part of their budget deliberations for 2022/23:-
· a recognition that the income generated from investment properties had enabled the Council to maintain delivery of some of its discretionary services
· whilst the Committee did not have any objections or changes to the Council’s investment portfolio, the fluctuation of investment property prices was discussed. It was acknowledged that fluctuation in property prices was to be expected and due to the properties being income generators and not buy to sell, the Committee were satisfied that the income generated was assisting in the delivery of services
· the ongoing development work being undertaken in procurement and the local business directory was welcomed and the Committee is keen that local businesses and buying local wherever possible should continue to be a priority
· as part of Scrutiny’s ongoing role in budget considerations, the Committee would be receiving an overview of how social value is taken into account to consider how the Council’s current contracts have incorporated this within their recent procurement activity
· overall, the Committee welcomed the details contained within the budget update and MTFS and recognised the ongoing challenges for the Council.