Issue - meetings

(Director of Resources) to consider the attached report.

This report originally went to the Finance and Performance Management Cabinet Committee in July 2017.

The Assistant Director Accountancy, P Maddock, introduced the report on the financial issues paper. The report had previously been to the Finance and Performance Management Cabinet Committee. It provided a framework for the Budget 2018/19 and updated Members on a number of financial issues that would affect this Authority in the short to medium term.

In broad terms the following represented the greatest areas of current financial uncertainty and risk to the Authority

The report went on to outline in general terms the state of the Council’s finances and the problems (potential or otherwise) facing it. The report touched on the recent elections and what Brexit might mean for us. It outlined the state of the General Fund, detailing the CSB, and the DDF. It updated members on the Medium Term Financial Strategy, the current position on Central Government funding, and the existing position on business rate retention scheme. The report also noted that the reduction in New Homes Bonus for 2017/18 was far greater than had been anticipated and outlined the upcoming development opportunities in the district.

It was noted that the Invest to Save fund was still looking for ideas as it still had some money left. If members had anything they would like to can put it forward for consideration. 

Councillor Bassett asked where would the funds from the Shopping Park go to and was informed that it would go into the General Fund.

Councillor Bassett then asked when would we see the long term savings from the Transformation Programme coming through. He was told that the people strategy would be starting up now. Officers were now looking to 2018/19 for any savings to come through.

Councillor Whitehouse said that no money had come back from the Invest to Save projects; where was this money? Mr Maddock replied that the savings would eventually go back into the CSB.

Councillor Bedford asked if officers could find out what happened to the other authorities who accepted the DCLG settlement. Mr Maddock said that they would look into this.

RESOLVED:

That the Financial Issues Paper was noted by the Committee.

(Director of Resources) To consider the attached report (FPM-006-2017/18).

The Director of Resources advised that the report provided a framework for the Budget 2018/19 and updated Members on a number of financial issues that would affect the Authority in the short to medium term. He advised that following the General Election result on 8 June 2018, the outcome of the Government being weakened greatly limited their legislative ambition and with the Brexit negotiations there had been little point in updating the MTFS for anything other than the 2016/17 outturn. There had also been concerns over the policies that had been previously mentioned by the Government such as devolution, housing, planning and the fair funding review before the General Election but had not featured in the recent Queen’s Speech.

The Director of Resources advised that the following issues represented the greatest areas of current financial uncertainty and risk to the Authority;

Central Government Funding – the Settlement Funding Assessment (SFA) would reduced over the next four years by £2.43m (45%) and exceed the SFA in 2019/20, creating a negative Revenue Support Grant. The Fair Funding Review, which concerned the funding formulae for devolved administrations had not been mentioned in the Queen’s Speech and the existing approach of an annual reduction being applied to the old formula amounts to achieve the desired overall reduction in funding would be likely to continue.

Business Rates Retention - There had been very little growth anticipated after 2016/17, despite the building of the retail park and other known likely developments within the district. It was the first year which would be billed using the new rating list which would be a particularly challenging year for estimating business rates. There were also still hundreds of appeals outstanding on the old lists and based on previous experience and discussions with the Valuation Office, the total provision against appeals was currently £3.5m. Furthermore the 100% local retention of business rates had been not mentioned in the Queen’s Speech and appeared to be on hold and the Council remained in the business rates pool for 2017/18, which would be monitored for future pooling.

Welfare Reform - The Local Council Tax Support (LCTS) scheme overall had been a success with the collection of some Council Tax from most of the people receiving support. There had been no significant changes proposed for 2018/19, to allow sufficient time to understand the consequences of changes with the National Living Wage and tax credits. The introduction of the Benefits Cap limit to the total amount of benefits a household could receive in a year to £26,000 and the further reduction by £6,000 to £20,000 was likely to cause greater changes in people’s behavior and working patterns. The lower cap had been phased in across the country during 2016/17 and early indications were that 157 claimants in the district would be affected. Universal Credit (UC) still continued to progress slowly with some post codes in the district being affected from September 2017 and new claims being fully covered by September 2018. The clarity over the  ...  view the full minutes text for item 11