Issue - meetings

Finance and Economic Development - to consider the attached report (C-023-2020-21) - to note and agree the financial planning process for 2021/22 to 2025/26.

(1)    The Cabinet noted the backdrop to the Financial Planning process for 2021/22 to 2025/26, including the impact of Covid-19 and emerging changes in local authority finance; and

(2)    agreed the proposed approach to Financial Planning, including the reporting and governance timetable as summarised in Appendix A of the report.

The Finance and Economic Development Portfolio Holder, Councillor J Philip, introduced the updating position report on the Council’s financial position and the start of budget planning for the coming year.

The Council’s financial position had been fundamentally altered by the Covid-19 pandemic.

The Council’s General Fund had incurred substantial additional costs in combatting the pandemic and all the main sources of income have been adversely affected.

In recognition of the financial pressures that local authorities were under, the Government had provided significant financial support, although so far, it fell significantly short of the true local cost.

The Housing Revenue Account (HRA) had so far fared better, although there had still been some negative impacts, with tenant rent arrears rising and void periods increasing.

He noted that they wanted to remain a low council tax authority and maintain the services that they were currently offering. Also, that it may be that the October Cabinet meeting maybe too soon to bring further papers forward.

Councillor Chris Pond asked about the deficits that were mounting up and what proportion would we receive back from the Government in the form of grants etc. and if not, the full amount, how would we tackle this financial pressure; would it involve an additional council tax rise or be taken from reserves. Councillor Philip said that he did not want to predict what we would get from the government. We may use our reserve to fill any holes as he would like to keep Council Tax to a minimum, but he would need to react to situations as they arose. We were in a strong position now in regard to our reserves and he thanked his predecessor, Councillor Stavrou, for leaving the Council in a position where we have not had to have an emergency budget and enabled us able to fulfil our obligations.

Councillor Heap asked they did not just borrow money to cover their shortfall. Councillor Philip replied that he hoped not to have to borrow, as that was not a good model to borrow to fund your existing expenditure.

Decision:

(1)    The Cabinet noted the backdrop to the Financial Planning process for 2021/22 to 2025/26, including the impact of Covid-19 and emerging changes in local authority finance; and

(2)    Agreed the proposed approach to Financial Planning, including the reporting and governance timetable as summarised in Appendix A of the report.