Agenda item

To consider the report of the Head of Finance (papers to follow).

The Cabinet member for Finance introduced the report, supported by the Head of Finance who was present in the room. The Strategic Finance Manager was present online.

The position was explained, also considering the context of a Local Government Reorganisation (LGR).

Comments:

·       Can we show the budget for the previous years and the performance against it, to show the accuracy of budgets and the pressures on the council. Monitoring of outcomes against the original budget. The Head of Finance confirmed a column could be added. The Cabinet member added that service area revenue figures were produced three times a year, and the outturn report was scrutinised. The Head of Finance explained that over recent years we had reigned in any over-budgeting. An extra column on the Medium-Term Financial Plan (MTFP) was confirmed as being an option.

·       A member asked for information on the Community Hub service. The Cabinet member explained that there was no cut, but it was previously due to come to an end, but there had been a growth bid for this area of £120,000. Some areas of work will move to other areas such as the Housing team. No reduction on the offering for Community Hub was confirmed.

·       National Insurance (NI) contributions. A member asked for an explanation of the settlement figure from government not covering the added cost of NI, noting that it was an estimate. Cabinet member explained that LG Futures had conducted work to come up with a figure. More detail may emerge on this figure in February.

·       Point 35 in the report, on borrowing. It was confirmed to be internal borrowing. A member asked whether the future plan was to retain internal borrowing. The Cabinet member explained that if the capital programme progresses as expected, we do not expect to borrow externally. Capital receipts may be received in the meantime.

·       A member asked about whether there was a calculated limit for council borrowing, as authorities such as West Berkshire do have a policy of external borrowing. The Cabinet member explained that West Berkshire was a unitary, so was a different organisation to our council. If a project came forward that was feasible and revenue generating, potential external borrowing would be considered, and sometimes it’s necessary based on advice. The Head of Finance added that we are showing a borrowing line but we will use our cash balances. We have a borrowing need but it was a cash flow decision about whether we are better off running down cash balances, rather than borrowing from the market and incurring borrowing interest fees.

·       On The Beacon – a member asked about the costs of running the facility in light of the five-year projections. As a discretionary service it could crowd out other areas. The Cabinet member added that a report was due in March, and work was being done to help reduce the costs of the venue and improve revenue. All discretionary services would be reviewed as needed for their proportional worth.

·       Discussion around projects in light of LGR occurring. The Cabinet member explained that this was unknown but it was expected that anything committed to and contracted for should be kept. His concern was the impact on officer time dealing with a merger and taking time away on other delivery.

·       A discussion was had on business rates – we hold the rates and the interest, and we pay County the specified amount. There was a discussion on business rates for specific projects such as renewable energy.

·       Discussion on council tax and the effectiveness of a referendum or dispensation. The council was not in financial difficulty, but there were these options to consider as the position becomes less stable as predicted over time. There was a further discussion about merger referendums and the outcomes for council tax. Bespoke decisions would be taken per unitary area and would take into account the impact on residents from areas with differing council tax rates.

Resolved:

Members agreed to note the report.

Officers and the Cabinet members involved were thanked by the chair, also noting the support provided by Councillor Coleman.