Agenda item

Council Budgets 2018/19

(Director of Finance) To consider the attached report (C-046-2017/18).

Decision:

(1) That the following guidelines for the Council’s General Fund Budget in 2018/19 be recommended to the Council for adoption:

(a) the revised revenue estimates for 2017/18, which were anticipated to increase the General Fund balance by £0.53million;

(b) a decrease in the target for the 2018/19 Continuing Services Budget (CSB) from £12.92million to £11.91million (including growth items);

(c) an increase in the target for the 2018/19 District Development Fund (DDF) net spend from £0.93milion to £3.91million;

(d) an increase of 2.48% in the District Council Tax for a Band ‘D’ property to raise the charge from £148.77 to £152.46;

(e) the estimated increase in General Fund balances in 2018/19 of £0.99million;

(f) the five year Capital Programme for the period 2017/18 – 21/22;

(g) the Medium Term Financial Strategy for the period 2017/18 – 21/22; and

(h) the Council’s policy on General Fund Revenue Balances to remain that they be allowed to fall no lower than 25% of the Net Budget Requirement;

(2) That the Housing Revenue Account (HRA) budget for 2018/19, including the revised revenue estimates for 2017/18, be recommended to the Council for approval;

(3) That the Council be requested to note that the rent reductions proposed for 2018/19 would give an average overall fall of 1%; and

(4) That the Chief Financial Officer’s report to the Council on the robustness of the estimates for the purposes of the Council’s 2018/19 budgets and the adequacy of the reserves be noted.

Minutes:

The Finance Portfolio Holder presented a report on the Council Budgets for 2018/19.

The Portfolio Holder set out the detailed recommendations for the Council’s budget for 2018/19. It was intended to add £990,000 to the reserves and the Council’s policy on the level of reserves could be maintained throughout the period of the Medium Term Financial Strategy (MTFS). However, the Strategy indicated that it would be necessary to use reserves to support the provision of services with contributions of £387,000 in 2020/21 and £557,000 in 2021/22. The budget was based on the assumptions that the Council Tax would increase by 2.48% and that average Housing Revenue Account rents will decrease by 1% in 2018/19.

The Portfolio Holder highlighted the Chief Financial Officer’s report to the Council on the robustness of the estimates for the purposes of the Council’s 2018/19 budgets and the adequacy of the reserves within the budget report. It stated that the estimates as presented were sufficiently robust for the purposes of the Council’s overall budget for 2018/19. In addition, the Council’s reserves were adequate to cope with the financial risks facing the Council in 2018/19, but further savings would be needed in subsequent years to bring the budget back into balance in the medium term. However, there were particular concerns about the delivery of the savings from Transformation, the introduction of a new system of “Fair Funding” and the difficulties in estimating income from the retention of business rates.

The Portfolio Holder added that an opportunity had arisen to progress some of the staff changes under the People Strategy more quickly than originally anticipated to speed up the transformation process. Therefore, it was proposed to bring forward £300,000 of District Development Funding from 2018/19 to 2017/18, and this would necessitate an amendment to recommendation 1(c) in the report to read “an increase in the target for the 2018/19 District Development Fund (DDF) net spend from £0.93milion to £3.91million;“.

The Portfolio Holder acknowledged that this would be the first proposed rise in the District Council Tax precept for many years, however it would be ring-fenced to fund the additional security measures planned for the District, and the Portfolio Holder expected this rise to be reversed in three years time when the proposed agreement with Essex Police expired. The Director of Resources and his Accountancy team were thanked for their efforts in preparing the budget, which the Cabinet were urged to recommend to the Council for approval.

The Portfolio Holder for Assets & Economic Development informed the Cabinet that the Council would accrue benefits from the developments at St Johns Road in Epping, Pyrles Lane in Loughton and other miscellaneous schemes as detailed in the minutes of the recent meeting of the Asset Management & Economic Development Cabinet Committee.

Cllr Murray reiterated that he could not support the proposed rise in the District Council Tax precept. The standard of living for many residents was falling and they were facing real financial difficulties; the District Council should not be directly funding Police Officers. The Portfolio Holder repeated that the rise in the District Council Tax precept had been ring-fenced for these measures, and unfortunately no savings had been identified to keep the District Council Tax precept at its existing level.