Agenda item

This report sets out the Council’s budget proposals for 2023/24 and also provides a general update on the Council’s overall financial position, including an overview of the current economic outlook.

Cabinet RESOLVED

(1)     To note the overall financial position, as set out within the report.

(2)     To approve consultation on the new budget proposals, as set out in Appendices A and B of the report.

(3)     To agree to consult on a Council Tax increase of 2.99% (consisting of a 1.99% general increase plus 1% for the Adult Social Care Precept) in 2023/24.

(4)     To endorse the approach to the statutory process of consultation, scrutiny and equalities between November 2022 and February 2023, as set out in Section 8 of the report.

(5)     To endorse the changes to the technical budget assumptions underpinning the budget, as set out in Section 4 of the report.

(6)     To note the position with regard to the funding for Schools and the Dedicated Schools Grant, as set out in Section 9 of the report.

(7)     To note the rent increase for 2023/24 would be subject to the outcome of the government consultation on the proposed rent cap, as set out in Section 10 of this report.

(8)     To note the position with regard to the Capital programme, as set out in Section 11 of the report.

Councillor Mili Patel (Deputy Leader & Cabinet Member for Finance Resources & Reform) introduced a report which set out the Council’s budget proposals for 2023/24.  The report also provided a general update on the Council’s overall financial position, including not only the Council’s General Fund revenue budget but also Housing Revenue Account, Dedicated Schools Grant and Capital Programme as well as an overview of the current economic outlook.

In considering the report, members noted the ongoing risks and uncertainties outlined in relation to inflationary pressures, the economic challenges resulting from the war in Ukraine, Government’s short term funding settlements and delay in wider local government funding reforms along with the impact of the cost-of-living crisis and Brexit.  Members also noted this followed a twelve year period of significant reductions in Government funding which had required the Council to make £197m worth of savings, despite an increase in demand for key services.  In noting the challenges these issues had presented in relation to the Council’s overall Medium Term Financial Strategy, members were advised that the proposals detailed within the report had been designed to address the significant financial impacts arising from the demographic and inflationary pressures identified whilst also seeking to ensure that the Council continued to operate in a financially sustainable and resilient way.

As a result of the issues identified, members were advised that the budget gap now being forecast between 2023-24 and 2024-25 had (as originally reported to Cabinet in July 2022) now been estimated (based on current assumptions) as £28m profiled at £18m for 2023-24 and £10m the year after.  Given the high level of uncertainty over the current economic environment and Government’s longer term funding settlement for local government, members noted that the approach identified to address this position had required restricting the budget proposals to a single year, rather than outlining a two-year programme as had previously been standard practice.

In terms of the savings identified, a series of additional proposals totalling £18m had been outlined within the report which, subject to approval following consultation and scrutiny, would need to be implemented in 2023-24. These new savings proposals had been detailed in Appendices A & B of the report, which taken alongside the updated budget assumptions and proposal to seek (at this stage) a Council Tax increase of 2.99% (based on a 1.99% general increase plus 1% for the Adult Social Care precept) would enable the Council to set a balanced budget for 2023-24.

Whilst noting that the proposals had been designed to limit, as far as possible, service reductions and the impact on front line services, members recognised the challenging nature of their delivery.  Concern was also expressed at the impact of the significant uncertainty which remained over the Government’s local government funding proposals for the medium term in the absence of a longer term Spending Review and the outcome of other reforms including the Fair Funding review and to the business rates regime.

Having recognised the adverse impact of the measures included in the Governments mini budget delivered in September and subsequent adjustments which had needed to be made by the Government in October, members also noted the uncertainty in terms of further announcements anticipated in the Chancellors Fiscal Statement due to be delivered on 17 November 2022, which had the potential to require further review and adjustment of the Council’s budget proposals for 2023-24 prior to them being finalised.

In concluding her introduction, Councillor Mili Patel once again highlighted how challenging and difficult development of the budget proposals had been and thanked Cabinet Members and officers for their support and efforts in the process.

In supporting the budget proposals, contained within the report, Cabinet Members recognised the ongoing nature of the challenges and financial pressures identified and also took the opportunity to thank the finance team for their work in developing the budget proposals whist also seeking to safeguard, as far as possible, key services and support for local residents and businesses focussed around the Council’s core strategic priorities.  It was noted these priorities included maintaining the ongoing commitment to increase the supply of genuinely affordable and accessible housing alongside the regeneration of the borough and creation of employment opportunities whilst also seeking to keep the borough as clean and green as possible in tackling the climate emergency and provide for maintenance of key infrastructure.  Members also welcomed the aim to continue prioritising the most vulnerable in society whilst also seeking to protect essential services particularly in relation to health and adult social care (given the significant pressure on health service funding), culture, children and young people in order to maintain support for residents across the borough and ensure the best possible outcomes for all.

In summing up, Councillor Muhammed Butt highlighted how the proposals, despite the significant challenges and frustrations identified in relation to wider funding constraints by the Government, had been designed to ensure the Council was able to deliver a balanced budget and ensure that the Council would continue to operate in a financially sustainable and resilient way whilst seeking to support and protect local residents as far as was possible during such challenging times in line with the Council’s core strategic priorities.

Having noted the current financial context in which the budget proposals had been developed Cabinet RESOLVED:

(1)     To note the overall financial position, as set out within the report.

(2)     To approve consultation on the new budget proposals, as set out in Appendices A and B of the report.

(3)     To agree to consult on a Council Tax increase of 2.99% (consisting of a 1.99% general increase plus 1% for the Adult Social Care Precept) in 2023/24.

(4)     To endorse the approach to the statutory process of consultation, scrutiny and equalities between November 2022 and February 2023, as set out in Section 8 of the report.

(5)     To endorse the changes to the technical budget assumptions underpinning the budget, as set out in Section 4 of the report.

(6)     To note the position with regard to the funding for Schools and the Dedicated Schools Grant, as set out in Section 9 of the report.

(7)     To note the rent increase for 2023/24 would be subject to the outcome of the government consultation on the proposed rent cap, as set out in Section 10 of this report.

(8)      To note the position with regard to the Capital programme, as set out in Section 11 of the report.