Issue - meetings

To consider a report by Councillor Julian Thompson-Hill, Lead Member for Finance, Performance and Strategic Assets (copy enclosed) setting out the implications of the Local Government Settlement 2021/22 and proposals to finalise the budget for 2021/22.

RESOLVED that Cabinet –

(a)       notes the impact of the Draft Local Government Settlement 2021/22;

(b)       supports the proposals outlined in Appendix 1 to the report, and detailed in Section 4 of the report, and recommends them to the full Council in order to finalise the budget for 2021/22;

(c)        recommends to Council the average Council Tax rise of 3.8% proposed;

(d)       recommends to Council that authority is delegated to the Head of Finance and Property in consultation with the Lead Member for Finance to adjust the use of cash included in the budget proposals by up to £500k if there is movement between the draft and final settlement figures in order to allow the setting of Council Tax in a timely manner, and

(e)       confirms that it has read, understood and taken account of the Well-being Impact Assessment submitted as part of the report.

Councillor Julian Thompson-Hill presented the report setting out the implications of the draft Local Government Settlement 2021/22 and proposals to finalise the budget for 2021/22, including the level of Council Tax.

Councillor Thompson-Hill provided an overview of the budget process and latest budget position and elaborated upon the proposals for consideration and recommendation to full Council in order to set the budget for 2021/22.  The draft settlement had resulted in a positive settlement of +3.6% (compared to the Welsh average of 3.8%) with the final settlement expected on 2 March 2021.  Pressures amounting to £9.903m had been detailed and the impact of using £685k of cash in 2020/21 meant the total shortfall amounted to £10.588m.  The +3.6% settlement generated £5.42m leaving a funding gap of £5.167m with proposals to bridge that gap identified in the report and further explained at the meeting.  A Council Tax rise of 3.8% had been proposed to generate £2.132m additional revenue.  Due to the lateness of the final settlement it was recommended that authority be delegated to enable cash adjustments included in the budget proposals of up to £500k.

The Head of Finance and Property added that the budget was very much business as usual with an assumption that a level of Welsh Government support would be forthcoming if Covid-19 related pressures continued.  He also confirmed there would be early engagement with members on the budget process for next year.

Main areas of debate focused on the following –

·         Councillor Mark Young referred to the funding shortfall and years of funding cuts to local authority budgets and he questioned the sustainability of future service delivery and sought an update on previous requests for a three year budget to aid future financial planning.  The Leader responded that the positive settlements over the last two years had to be appreciated, particularly given the current financial situation faced by both UK and Welsh Governments.  There had been regular and positive dialogue with Welsh Ministers throughout the pandemic and they understood the challenges and pressures faced by local government and Welsh Government had been supportive in the way they had responded and reacted to the Covid-19 situation.  However the forthcoming Welsh Parliament election may result in a change Minister which could have a significant impact.  The Chief Executive welcomed the funding settlement which enabled the authority to cover most service pressures for 2021/22 but there was no guarantee that emerging pressures from Covid-19 related income loss would be met.  If future settlements were not sustained at such a level to meet increasing pressures, particularly in social care, difficult decisions would need to be made.  In terms of a three year settlement the Head of Finance and Property explained that the original proposal for a comprehensive spending review had been delayed due to Covid-19 and a one year settlement had been announced by the Chancellor last November.  Welsh Government would need a three year indication of their figures from the UK Treasury to realistically be in a position to provide a three year settlement for local government going forward

·         Councillor Glenn Swingler referred to year on year savings made by schools and felt it was not appropriate to seek further savings in light of the difficulties faced in responding to Covid-19 and he queried the amount of investment made within schools.  In terms of the overall savings package he asked whether it could be revisited to further consider the affordability element for residents.  The Lead Member for Finance clarified that work had been ongoing with the School Budget Forum (SBF) for some time, as in previous years, to deliver the  ...  view the full minutes text for item 8