| Time: | 7.30pm | Place: | Council Chamber, Council Offices, Gernon Road, Letchworth Garden City |
| PRESENT: | Councillor Mrs L.A. Needham (Chairman), Councillor T.W. Hone (Vice-Chairman), Councillor P.C.W. Burt, Councillor Julian Cunningham, Councillor Tony Hunter, Councillor David Levett and Councillor Bernard Lovewell. |
| IN ATTENDANCE: | Chief Executive, Strategic Director of Finance, Policy & Governance, Strategic Director of Customer Services, Accountancy Manager, Strategic Planning & Projects Manager, Principal Strategic Planning Officer, Acting Corporate Legal Manager and Committee & Member Services Manager. |
| ALSO PRESENT: | 3 members of the public. |
| Meeting attachment |
Agenda Front Sheets |
| Item | Description/Resolution | Status | Action | |
| PART I | ||||
| 96 |
APOLOGIES FOR ABSENCE Apologies for absence were submitted on behalf of Councillor Jane Gray. |
Noted | ||
| 97 |
MINUTES Minutes RESOLVED: That the Minutes of the meeting of Cabinet held on 15 December 2015 be approved as a true record of the proceedings and signed by the Chairman. |
Agreed | ||
| 98 |
NOTIFICATION OF OTHER BUSINESS There was no notification of other business. |
Noted | ||
| 99 |
CHAIRMAN'S ANNOUNCEMENTS (1) The Chairman announced that Members of the public and the press may use their devices to film/photograph, or do a sound recording of the meeting, but she asked them to not use flash and to disable any beeps or other sound notifications that emitted from their devices. In addition, the Chairman had arranged for the sound at this particular meeting to be recorded; (2) The Chairman reminded Members that, in line with the Code of Conduct, any Declarations of Interest needed to be declared immediately prior to the item in question; (3) The Chairman asked that, for the benefit of any members of the public present at the meeting, Officers announce their name and their designation to the meeting when invited to speak; and (4) The Chairman reminded all present that the meeting of the Cabinet originally scheduled for Tuesday, 16 February 2016 had been cancelled. |
Noted | ||
| 100 |
PUBLIC PARTICIPATION There was no public participation. |
Noted | ||
| 101 |
ITEMS REFERRED FROM OTHER COMMITTEES There were no items referred from other committees. |
Noted | ||
| 102 |
STRATEGIC PLANNING MATTERS Report Appendix A - Extract from Housing Market Areas in Bedfordshire and Surrounding Areas Report Appendix B - NHDC response to Luton Borough Council Local Plan Pre-submission draft The Executive Member for Planning and Enterprise presented a report of the Strategic Director of Planning, Housing and Enterprise informing Members of the current position regarding strategic planning matters, with particular reference to Luton and Central Bedfordshire progress on Local Plans; St. Albans Local Plan; Stevenage Local Plan; Government Announcements; and North Hertfordshire Local Plan. The following appendices were submitted with the report: Appendix A - Extract from the Housing Market Areas in Bedfordshire and Surrounding Areas report showing Functional HMAs with Local Authority Boundaries; and Appendix B - NHDC Response to Luton Borough Council Local Plan Pre-submission draft. The Executive Member for Planning and Enterprise updated Cabinet on the following matters: - Housing Market Areas in Bedfordshire and surrounding areas - a recent study was commissioned by Luton/Central Bedfordshire/Milton Keynes Councils, the result of which was that there would be no change in North Hertfordshire's eastern boundary, which included a small amount of the Luton Housing Market Area. The change for North Hertfordshire was that the Royston Area, which was previously in the Cambridge Housing Market Area, was now wholly within the Stevenage Housing Market Area; - Luton Borough Council Local Plan - had consulted on a pre-submission draft of the Plan from 26 October 2015 to 7 December 2015. A response from NHDC was attached at Appendix B to the report, and as summarised in Paragraph 8.2 of the report; - Stevenage Borough Council Local Plan - was out for consultation from 6 January 2016 to 16 February 2016. A response would be prepared, and Cabinet's attention was drawn to Paragraphs 8.3 to 8.8 of the report, which outlined the issues which were of relevance to NHDC in the preparation of its own Local Plan; - St Albans City and District Council Local Plan - out for consultation from 8 January 2016 for six weeks. The evidence did not presently show the same levels of connection between North Hertfordshire and St Albans as was the case with Stevenage. Notwithstanding this, there may be certain issues which had a bearing on the preparation of North Hertfordshire's own Local Plan (eg. in relation to housing, Green Belt, unmet needs from Luton etc.). A response would be prepared and agreed under the Executive Member's delegated powers; - Housing and Planning Bill - had been debated in the House of Commons on 5 and 12 January 2016, and the Legislative Grand Committee and Third Reading of the Bill was taking place on 26 January 2016. The Executive Member summarised the amendments to the Bill and proposed new clauses, as set out in Paragraph 8.12 of the report; and - New Homes Bonus - it was vital that the Council met the Government target of March 2017 for progression of its Local Plan, otherwise there could be significant consequences in terms of the Government withdrawing New Homes Bonus from local authorities that failed to meet the deadline. RESOLVED: That the report on Strategic Planning Matters be noted. REASON FOR DECISION: To ensure that the Cabinet is kept informed of developments on strategic planning matters. |
Noted | ||
| 103 |
CORPORATE BUSINESS PLANNING - BUDGET 2016/17 Report Appendix 1 - General Fund estimates (1.9% Council Tax increase) Appendix 2 - General Fund Summary for 2016/17 Appendix 3 - Efficiency proposals Appendix 4 - Revenue Investment proposals Appendix 5 - MTFS extract - budget assumptions Appendix 6 - Description of earmarked reserves Appendix 7 - Financial Risks assessment The Executive Member for Finance and IT presented the report of the Strategic Director of Finance, Policy and Governance in respect of Corporate Business Planning - Budget 2016/17. The following appendices were submitted with the report: Appendix 1 - General Fund estimates (1.9% Council Tax increase); Appendix 2 - General Fund Summary for 2016/17; Appendix 3 - Efficiency proposals; Appendix 4 - Revenue Investment proposals; Appendix 5 - MTFS extract - budget assumptions; Appendix 6 - Description of earmarked reserves; and Appendix 7 - Financial Risks assessment. The Executive Member for Finance and IT advised that matters had moved on since the presentation of the draft Budget to Cabinet on 15 December 2015. He stated that the report, together with the Capital Programme and Treasury Management Strategy reports elsewhere on the agenda had been considered by the Finance, Audit and Risk Committee on 25 January 2015, at which no significant issues had been raised. The Executive Member for Finance and IT stressed that the report related to the 2016/17 Budget. The Medium Term Financial Strategy had stated that it may be necessary to re-visit the Budget forecasts, once there was greater clarity regarding the treatment of a number of key Government funding sources, such as New Homes Bonus and Business Rates. He confirmed that there had been some significant changes in the Provisional Finance Settlement received on 17 December 2015 that would directly impact on NHDC. The Executive Member for Finance and IT stated that the changes included the removal of any Revenue Support Grant (RSG) for NHDC from 2017/18 onwards. This change affected only NHDC and 14 other local authorities nationally. In addition, NHDC would be required to pay an additional tariff adjustment for Business rates, which effectively meant a negative RSG. This was because NHDC was deemed an Authority with a high Council Tax base and ability to collect Council Tax. The Executive Member for Finance and IT explained that, in anticipation of the Settlement, the General Fund Reserves had been increased to £6million, including a Special reserve of £1.7million. This was achieved partly as a result of the early achievement of a number of planned efficiencies. However, having reduced size and capacity over recent years, the ability of NHDC to continue to make further efficiencies without impacting upon front line services was now seriously limited. The Executive Member for Finance and IT stated that the initial forecast in December 2015 was for £1.7million to be found in the next four years up to 2019/20. This figure was now in the region of £3million, even assuming a yearly 1.9% increase in Council Tax and further use of reserves. The Executive Member for Finance and IT commented that the period of constraint on public sector budgets would continue for some years. NHDC remained under pressure to as to how it delivered services, and whether or not it should deliver some services at all. The Executive Member for Finance and IT advised that the Chancellor had re-iterated a move towards 100% retention of Business Rates by the end of the current term of Parliament. In 2015/16 NHDC was a member of the Hertfordshire Authorities Business Rates Pool, and this was planned to continue for 2016/17. The Chancellor had also announced that local authorities would have flexibility to spend some capital receipts from asset sales on cost of reform projects, subject to conditions set by the Government. The Executive Member for Finance and IT reported that the Provisional Settlement for NHDC for 2016/17 was £3.316million (£339,000 less than estimated), which was a reduction of 24% from 2015/16. From 2017/18, the additional RSG tariff to be paid by NHDC to the Government would be £1.6million. There had been no consultation on this matter, and the Council had made representations to the Government and local MPs. The Executive Member for Finance and IT stated that there were also major uncertainties over the New Homes Bonus, including a reduction from six years to four years. It was also clear that only authorities with a submitted Local Plan would be eligible to receive New Homes Bonus from 2017/18. The Executive Member for Finance and IT explained that the Treasury calculations had assumed that the annual growth in Council Tax base was 1.9%, when the actual figure was nearer to 1%. This could have a £100,000 a year negative impact on funding. In respect of balances, the Executive Member for Finance and IT commented that this included allowances for risks, as set out in Appendix 7 to the report. The risk allowance included in the General Fund balance would be £866,000 for 2016/17. Total reserves would be more than halved from £7.5million in 2016/17 to £3.6million in 2019/20. The variances on the Budget set out in Table 5 of the report had resulted in an estimated reduction in the working budget for 2015/16 of £245,000 and a corresponding increase in the 2016/17 Budget of £115,000. The Executive Member for Finance and IT advised that the efficiency and investment proposals submitted to Cabinet in December 2015 had changed slightly as a result of the Provisional Settlement. The new revenue investment proposals for 2016/17 now totalled £411,000 (down from £590,000). The changes related to Appendix 4 to the report as follows: R3 - Apprenticeship Levy - now £45,000 (previously "TBC"); R6 - North Herts Local Plan - now £30,000 (from £50,000); R8 - Government Framework Agreement (Microsoft) - now £3,000 (from £20,000); R14/15 - Use of Bed and Breakfast accommodation for homelessness - now zero (from £50,000), due to reduced use of such accommodation (Risk FR9 had been increased in value); and R16 - Staff related resource capacity issues - now zero (from £137,000), as these issues would be reviewed by the Head of Paid Service as part of future restructuring once the final 2016/17 settlement was known. The Executive Member for Finance and IT concluded by recommending a 1.9% increase in the Council Tax rate for 2016/17 (8p a week for a Band D property). Cabinet supported the recommendations contained in the report. The Executive Member for Finance and IT accepted that in terms of the 4 year settlement offered the Government, if, when further details on the Government requirements were known, the proposed Efficiency Plan raised significant issues, then it would be reported to Cabinet. He further accepted that the budgetary situation regarding the use of Bed and Breakfast accommodation and the North Hertfordshire Local Plan may need review should circumstances change and the risk allowance be exceeded. RECOMMENDED TO COUNCIL: (1) That it be noted that the provisional finance settlement for 2016/17 is £3.316 million, which is £339,000 less than estimated; (2) That: (a) it be noted that the provisional settlement refers to the potential to agree a four year settlement with Government, subject to an Efficiency Plan; and (b) as details of the requirements of such a Plan are not yet known, the Strategic Director of Finance, Policy and Governance, in consultation with the Executive Member for Finance and IT, be delegated the decision on whether or not to accept that offer when further details are known; (3) That the estimated position on the Collection Fund and the impact on the General Fund for 2016/17 (Paragraph 9.1 of the report refers) be noted; (4) That the position relating to the General Fund balance be noted, and that due to the risks identified in Paragraph 9.2.3 of the report, a minimum balance of £1.694million is recommended; (5) That the changes to the 2015/16 General Fund budget identified in Paragraph 9.2.8, table 5, a £245,000 decrease in net expenditure and a corresponding increase in the 2016/17 budget of £115,000, be approved; (6) That the position of the other reserves and provisions as identified in Section 9.3 of the report be noted, and that the Chief Finance Officer considers the estimates robust and the budgeted level of reserves adequate; (7) That the inclusion of the efficiencies and investment proposals at Appendices 3 and 4 of the report in the General Fund budget estimates for 2016/17 be approved; (8) That it be noted that work will continue during the next financial year on the production of business cases for the items marked "tbc" in Appendices 3 and 4 of the report; (9) That the estimated 2016/17 net expenditure of £16,533,100, as detailed in Appendix 2 of the report, be approved; and (10) That a 1.9% increase in the Council Tax rate for 2016/17 be approved. REASON FOR DECISION: To ensure that all relevant factors are taken into consideration when arriving at the proposed Council Tax precept for 2016/17; and to ensure that the Cabinet recommends a balanced budget to Council on 11 February 2016. |
Agreed | ||
| 104 |
CAPITAL PROGRAMME 2016/17 ONWARDS Report Appendix A - Capital Programme Summary Appendix B - Capital Programme Detail Appendix C - Capital Investment Proposals for 2016/17 and onwards The Executive Member for Finance and IT presented the report of the Strategic Director of Finance, Policy and Governance in respect of the proposed Capital Programme 2016/17 onwards. The following appendices were submitted with the report: Appendix A - Capital Programme Summary; Appendix B - Capital Programme Detail; and Appendix C - Capital Investment Proposals for 2016/17 and onwards. The Executive Member for Finance and IT advised that the estimated capital spend in 2016/17 was £8.35million, including £550,000 of new Capital Investment Proposals. The total capital spend to 2019/20 was estimated at nearly £20million. The Executive Member for Finance and IT stated that the Council would be asked to consider a Capitalisation Direction to allow payment of a lump sum of up to £2.5million to the Pension Fund to avoid the increased revenue contributions that would be required in coming years. The Executive Member for Finance and IT explained that the Capital Programme was funded by a contribution of third party contributions (eg. Section 106 and grants), Government grants, revenue contributions, prudential borrowing and useable and set aside capital receipts. From 2016/17 to 2019/20 the total useable and set aside capital receipts would be £17.625million. Approved disposals during 2016/17 were expected to generate £3.5million. In the light of the provisional Finance Settlement, the Executive Member for Finance and IT would be requesting fellow Executive Members to re-examine their respective elements of the Capital Programme, in order to ascertain the revenue implications of each project. Executive Members would also be asked to ascertain whether there were sufficient resources to undertake each scheme. RECOMMENDED TO COUNCIL: (1) That the inclusion of all the capital investment proposals, listed in Appendix C of the report, which total £13.043million overall (£3.293million profiled in 2016/17) in the proposed Capital Programme, be approved; (2) That the provisional Capital Programme for 2016/17 to 2019/20 of £19.4million, as detailed at Appendix A and Appendix B of the report, be adopted; and (3) That authority be delegated to the Strategic Director of Finance, Policy and Governance, in consultation with the Executive Member for Finance and IT, to seek a capitalisation direction of up to £2.5million to enable a contribution to be made to the Pension fund as soon as possible to improve the revenue position of the General Fund. REASON FOR DECISION: To ensure that the Capital Programme meets the Council's objectives and officers can plan the implementation of the approved schemes. |
Agreed | ||
| 105 |
TREASURY MANAGEMENT STRATEGY FOR 2016/17 Report Appendix A - Treasury Management Policy Statement Appendix B - Treasury Management Practices Appendix C - Treasury Strategy Statement The Executive Member for Finance and IT presented a report of the Strategic Director of Finance, Policy and Governance in respect of the Treasury Management Strategy for 2016/17. The following appendices were submitted with the report: Appendix A - Treasury Management Policy Statement; Appendix B - Treasury Management Practices; and Appendix C - Treasury Strategy Statement 2016/17. The Executive Member for Finance and IT advised that the proposed Strategy contained no major changes from 2015/16, as the existing Strategy was working well, especially in the level of interest generated for the Council. The Executive Member for Finance and IT stated that the Strategy could be summarised in terms of security; liquidity and yield. A mid year review of the Strategy had been provided to Members in December 2015. CIPFA practice was followed, but unlike some other local authorities, NHDC invested in UK building societies. The Executive Member for Finance and IT commented that the balance of Cash Manager investments at the start of 2015/16 was £33million. This was expected to reduce by about £4.5million by the end of 2015/16 to fund the Capital Programme. Total interest generated for 2015/16 was expected to be in the region of £430,000, with an estimate for 2016/17 of £350,000-£400,000. RECOMMENDED TO COUNCIL: (1) That the Treasury limits for 2016/17 be approved as follows: (i) Interest Rate Exposure (as at Paragraph 3.4, Appendix C); (ii) Maturity Structure of Borrowing (as at Paragraph 3.4, Appendix C); (iii) Investment Strategy to continue to use Building Societies and UK Banks (as at Paragraph 4.2, Appendix C); (iv) Total Principal Sums invested for periods longer than 364 days (as at Paragraph 4.3, Appendix C); and (2) That the Treasury Management Strategy for 2016/17, as set out at Appendix C to the report, be approved, and that it be noted that there are no changes from the approved 2015/16 Treasury Strategy. REASON FOR DECISION: To ensure the Council's continued compliance with CIPFA's Code of Practice on Treasury Management and the Local Government Act 2003 and that the Council manages its exposure to interest and capital risk. |
Agreed | ||