Agenda item

To receive the following question in accordance with Council procedure rule 33.

Question from Councillor Simon Howell to Councillor Andrew Crawford, Cabinet Member for finance

“The Leader of the council highlighted, at the annual meeting of the council, the need to produce a sustainable budget and improve income generation, including a line by line review.

Could the Cabinet member update Council on progress made over the last six months and the current financial health of the council as we approach the timeframe for the preparation of budgets”.

Question from Councillor Simon Howell to Councillor Andrew Crawford, Cabinet Member for finance

“The Leader of the council highlighted, at the annual meeting of the council, the need to produce a sustainable budget and improve income generation, including a line by line review.

Could the Cabinet member update Council on progress made over the last 6 months and the current financial health of the council as we approach the timeframe for the preparation of budgets”.

ANSWER

The budget setting report of February 2019 set out the significant financial challenge that lays ahead for our Council.  The ending of the New Homes Bonus scheme has left a significant hole in our Medium Term Financial Plan that has to be addressed. The government has failed to inform councils of what will replace New Homes Bonus resulting in great uncertainty around what funding streams will be available to councils in the future.

New Homes Bonus was projected to generate over £7.4 million pounds by 2022/23 nearly 50 percent of the council’s net revenue spend. Adjusting for a loss of funding of this scale will take careful planning and cannot be done overnight. My budget report in February 2020 will set out the first steps we have taken along with future actions that will have to be seriously considered. 

My work may have been further progressed if my Group’s proposed amendment to the Conservative 2019/20 budget had been approved.  Unfortunately, our proposal to create a £50,000 Commercial Investment Projects Fund to be drawn down during the year to pay for resource and expertise to explore how to maximise the council’s investments and identify appropriate revenue generating schemes was rejected by the previous administration.  Similarly, if the Five Councils Contract had delivered the savings the previous administration budgeted for my challenge would not be as great. 

As we progress budget setting, I can advise Council that Heads of Service are in the process of review fees and charges to ensure the council is maximising its income where it can.  Both finance officers and portfolio holders have carried out detailed budget challenges which have been welcomed by Heads of Service. I am currently involved in a number of other initiatives to help close the funding gap left by the previous administration and I will report on these when I bring my budget report to Council in February.

SUPPLEMENTARY QUESTION

Councillor Howell thanked Councillor Crawford for his response which set out details of the historic events but did not address the current financial health of the council and the current funding situation as it stands.

As a supplementary question Councillor Howell asked what specific actions are being taken to manage the finances given that at the latest Cabinet meeting it was reported that various line by line overspends result in an expected overspend for the current financial year of around £200,000? Can the promised review of line by line management of budget be relied on, given this forecast, and given that this information considered by Cabinet was three months out of date?

Councillor Crawford undertook to provide a written response.