Submitted – The Minutes
(previously circulated) of all of this Scrutiny Committee’s
which had been held to discuss the proposals contained within the
Medium Term Financial Plan, which were within their individual
remits.
It was reported that all of the Scrutiny Committees had supported the proposals in relation to the proposed Council Tax increase of 2.99 per cent and the proposed increase in fees and charges within their own remits. Each of the Scrutiny Chairs presented, at the meeting, the outcomes of their Scrutiny Committees.
In presenting the findings of the Adults and Housing Scrutiny Committee, the Chair of that Scrutiny Committee also advised Members of the discussion which has taken place in relation to the Council’s Housing Review Account (HRA) and particular reference was made to the welcome lift by the Government of the borrowing cap on the HRA which would enable the Council to increase its housing capital programme by around £12 million.
The Chair of the Health and
Partnerships Scrutiny Committee reported that that Scrutiny
Committee had requested further information in relation to the
allocation of the £501,000 which had been identified for
winter pressures and it was reported that that money had now been
allocated and would be reported to Members.
In relation to Children’s
Services, reference was made to the significant pressures in
Children’s social care and the demand pressures on external
residential placements and independent fostering placements,
together with the cost of SEND school transport which was subject
to a review to reduce the current projected overspend.
Discussion ensued on the potential significant financial risks which could occur over the lifetime of the Plan which were difficult to predict at this time, particularly in relation to Brexit outcomes and it was highlighted that further discussions around how the Council would address these issues and the subsequent financial implications were needed. Some unease was raised about the Council agreeing to a four-year plan which could not be quantified at this stage in view of the uncertainty, however, the Assistant Director Resources reported that the Council had a long established process of operating a medium term approach to its financial planning and to only look at one year would not be prudent. In recommending the Plan to Members it had been accepted that the Council was carrying a significant risk in terms of the need to reduce expenditure, however contingencies had been put in place and the plan was based on the most accurate reflection of the Councils financial position.
It was reported that the Council had just been advised that it was to receive funding of £210,000 over the next two years to help it with its preparations for Brexit and that this funding would be put into reserves until called upon.
Reference was made to the role of this Scrutiny Committee in monitoring the MTFP over its life.
RESOLVED
- That, in relation to the
Medium Term Financial Plan, Cabinet be advised that :-
(i) the response of this
Council’s Scrutiny Committee is to support the proposed
increase in fees and charges and the proposed Council Tax increase
of 2.99 per cent for the next financial year; and
(ii) in considering the proposed four-year MTFP, the Efficiency and Resources Scrutiny Committee wishes to highlight its concern in relation to the potential significant financial risks over the lifetime of the plan, which are difficult to forecast at this time and that the Council’s Statutory Chief Financial Officer be formally requested to highlight these concerns to Cabinet
Pursuant to Minute C85(2)/Dec/18, the Leader introduced the report of the Chief Officers Executive (previously circulated), proposing a Medium Term Financial Plan (MTFP) for 2019/20 to 2022/23, including setting a budget and council tax increase for 2019/20 and a Capital Programme for 2019/20 to 2022/23, for Council approval on 21 February 2018.
The submitted report stated that the Council had faced unprecedented financial challenges between the financial years 2010/11 to 2019/20, following reductions in public sector spending, leading to an overall decrease in real terms in government funding of £45.7m, which was anticipated to increase to £50m by 2022/23. The reductions in funding resulted in the Council agreeing reductions to planned expenditure of £57m and a reduction of 747 in the Council’s workforce.
It was reported that since the draft MTFP had been proposed in December 2018 there had been a number of changes that affected the Council’s financial position, namely the receipt of the Local Government Finance Settlement, which confirmed the reduction in the revenue support grant of £2.8m; extra one off funding for social care of £0.856m that had been announced in the 2018 budget; additional funding of £0.346m that was allocated to Darlington following the distribution of surplus levy funding; and increases in Top up Grant and New Homes Bonus of £0.020m and £0.038m respectively.
The submitted report also stated that £1.5m had been saved over the MTFP life following the repayment of two Lender Option Borrower Option loans as part of a Treasury Management initiative; that a Core Offer budget was agreed following a significant consultation exercise undertaken in 2016 (Minute 11(h)/Jun/16 refers); delivering the Core Offer continued to be extremely challenging with significant pressures arising from Children’s social care; and that although further pressures had arisen, the Council could still deliver the agreed plan.
Discussion ensued on the risks to the Council associated with the MTFP; contingencies to mitigate those risks; Council Tax; and the Library Service.
RESOLVED – That it be recommended to the Special Meeting of Council scheduled to be held on 21 February 2019, that the Revenue Medium Term Financial Plan, as set out in Appendix 7 of the submitted report, and the proposed Capital Programme as summarised in Appendix 9 of the submitted report, be approved, including the following:-
(a) a Council Tax increase of 2.99% for 2019/20; and
(b) the Schedule of Charges, as set out in Appendix 3 of the submitted report.
REASONS – (a) The Council must set a budget for the next financial year.
(b) To enable the Council to continue to plan services and finances over the medium term.
(c) To ensure decisions can be made in a timely manner.