Issue - meetings

Budget Strategy 2012/13 to 2015/16

Meeting: 20/07/2011 - Budget and Finance Overview and Scrutiny Committee (Item 5)

5 Budget Strategy 2012/13 to 2015/16 pdf icon PDF 157 KB

This report sets out the financial prospects for the Council for the next four years. It seeks the Executive’s approval for the overall budget strategy based on the One Council Programme and the delivery of the Borough Plan. 

Additional documents:

Minutes:

Mick Bowden (Deputy Director of Finance and Corporate Services) introduced the report before members which set out the financial prospects for the Council for the next four years.  The report had previously been submitted to the Executive on 18 July 2011.  He reminded members that during last year a funding gap of £100m had been identified over the four years to 2014/15.  The 2011/12 budget included in excess of £40m savings and table 1 in the report showed a mid-point forecast of an additional £60.6m being required.  The report went on to explain the change to the way business rates would be distributed.  Details of the changes were still to be issued but it was clear that it would change the Council’s relationship with central government regarding funding and provide greater links with business growth within the borough.  Mick Bowden suggested this might be an area the Committee would want to consider later in the year.

 

Mick Bowden pointed out the implications of the Localism Bill on setting Council Tax rates as set out in paragraph 3.6 of the report.  He added that there were no proposals for a new Council Tax freeze grant relating to 2012/13.  He drew attention to the chart showing a comparison of Brent Council Tax levels from 2006/07 to expected levels if adjusted at the rate of inflation (RPI).  This showed that inflation was running ahead of Council Tax levels. 

 

With reference to the capital programme, Mick Bowden pointed out the revenue impact of this.  The schools programme of £24.522m was an area he suggested that Committee might want to look at in more detail.

 

Finally, Mick Bowden explained the budget strategy outlined in the report to respond to the financial position faced by the Council.

 

In answer to questions concerning interest rates, inflation and pension contributions, Mick Bowden explained that short-term interest rates did not have much of a direct bearing on the level of Council spend.  As an investor higher rates would be advantageous but the Council's borrowing was done on a long-term basis and those interest rates did not always move in line with short-term rates.  The level of inflation was based on projections over the medium term and increases in pension fund contributions were based on those set out by the Pension Fund Actuary.  The Hutton review had suggested changes to the pension scheme but this had not been factored into the budget.  Any changes would come through into the budget via the next Actuary’s report.

 

A question was asked around the level of balances and why it was proposed to add to these.  Mick Bowden referred to paragraph 4.6 of the Budget and Finance Overview and Scrutiny Committee's final report dated February 2011, which showed that the Director of Finance and Corporate Resources advised that a reasonable level of balances for the Council, given the increased risks,  was between £12m to £15m.  The budget strategy was to move closer to this figure.  An alternative view was put forward that a  ...  view the full minutes text for item 5


Meeting: 18/07/2011 - Executive (Item 16)

16 Budget Strategy 2012/13 to 2015/16 pdf icon PDF 158 KB

This report sets out the financial prospects for the Council for the next four years. It seeks Executive approval for the overall budget strategy based on the One Council Programme and the delivery of the Borough Plan. 

Additional documents:

Decision:

(i)         that the latest forecast for the Council’s revenue budget for 2012/13 to 2015/16 at Appendix A and the assumptions used to derive this be noted;

 

(ii)        that endorse the overall budget process set out in the report be endorsed;

 

(iii)       that the proposed budget timetable be noted.

Minutes:

The report before members from the Director of Finance and Corporate Services set out the financial prospects for the council for the next four years. Councillor Butt (Lead Member, Resources) advised that approval was sought to the overall budget strategy addressing the budget gap, achieving savings through the One Council Programme and the delivery of the Borough Plan. 

 

RESOLVED:-

 

(i)         that the latest forecast for the Council’s revenue budget for 2012/13 to 2015/16 at Appendix A and the assumptions used to derive this be noted;

 

(ii)        that the overall budget process set out in the report be endorsed;

 

(iii)       that the proposed budget timetable be noted.