Agenda item - DRAFT BUDGET 2023/24

REPORT OF THE SERVICE DIRECTOR – RESOURCES

For Cabinet to consider the latest forecasts in relation to funding, income and expenditure in relation to the revenue budget for 2023/24.

RESOLVED: That Cabinet

(1) Noted the latest funding forecasts for 2023/24 onwards and the significant uncertainty that still remains.

(2) Confirmed that it is necessary to increase Council Tax by 3% (the maximum amount now allowed without a local referendum) as this is what will be assumed by Government in determining the Business Rates that the Council can retain.

(3) Confirmed that the Council should be part of a Business Rate pool in 2023/24, but delegates to the Service Director: Resources, in consultation with the Executive Member for Finance and IT, authority to withdraw from the pooling arrangement if there are significant changes that would make it likely that the Council would suffer a financial loss from pooling.

(4) Noted the comments made at the budget workshops, and comment on the inclusion of the revenue savings and investments in the budget to be brought back for consideration in January, for referral on to Council in February.

(5) Noted the comments made at the budget workshops, and comment on the inclusion of the capital investments in the Investment Strategy to be brought back for consideration in January, for referral on to Council in February.

REASON FOR DECISIONS: To ensure that all relevant factors are considered in arriving at a proposed budget, Investment Strategy and Council Tax level for 2023/24, to be considered by Full Council on 23 February 2022.

Audio recording – 39 minutes 50 seconds

The Executive Member for Finance and IT presented the report entitled ‘Draft Budget 2023/23’ and advised of the following:

· Thanked Officers for the work put into this and to Members for the suggestions and comments made at the workshops.

· There had been consideration given to the rise in Council Tax, following the confirmation in the Autumn Statement that it would be increased by 3% without a referendum.

· Therefore it had been agreed to raise Council Tax by 3% in order to protect services offered.

· The Council Tax Reduction Scheme would mean that vulnerable residents were protected from this rise.

· Government had confirmed that this rise could take place for two years, 2023/24 and 2024/25, and this had been proposed.

· There had been no new funding formula or business rate reset planned for the next two years. Overall this was good news for the Council who could continue to collect pooled business rates.

· All councils would see at least a 3% increase in core spending power, before Council Tax rises.

· Ultimately, with the increased grants and Council Tax, the Council would be able to offer more flexibility which could be controlled by the Council.

· Whilst the increase in Council Tax is welcome in terms of income to Council, it was important to recognise the impact this would have on some residents. In spite of the proposed rises, the Council was still predicted to spend around £1m of its reserves.

· The Council will need to look at how best to use the money to support and help residents through schemes and services offered.

· Despite the difficult times for residents, the services provided by the Council, such as waste, leisure, recycling and community grants, offer good value for money.

· Further detail would be provided to Cabinet when the final government grant amounts had been confirmed.

The Chair of Finance, Audit and Risk Committee presented the referral on this item and noted:

· The Committee had overall supported the recommendations on the draft budget as presented.

· There had been lots of debate on this and information had been provided by the Service Director – Resources to support this.

· The latest funding forecasts highlighted that some uncertainty remained.

· The Committee had confirmed the requirement to raise Council Tax by 3%, the maximum amount allowed.

· They noted the comments made by Members at the budget workshops.

Councillor Steve Jarvis noted that he was pleased to see funding allocated to extend the opening times of the Letchworth Outdoor pool, following the successful extension this year. He also commented that, while no one wanted to pay more Council Tax, it was important to recognise the situation of those Councils who had not done this and are now in trouble and unable to provide services to residents and it was the most vulnerable most affected by this.

The Chair confirmed that without raising Council Tax the Council would have to draw on reserves and it was wrong that Local Authorities were put in this position by government. It was positive to see that Members and Officers looked at ways to increase and support community benefit schemes as part of the draft budget.

Councillor Ian Albert proposed and Councillor Elizabeth Dennis-Harburg seconded and, following a vote, it was: