Agenda item

To receive an update on the current Medium Term Financial Plan and Budget Timetable (copy enclosed).

The Head of Finance introduced the budget process update report (previously circulated). It was highlighted that in the attached appendix the figures quoted were slightly out of date, due to the deadline for the reports. The figures included were a snapshot at the time of writing.

Members were guided to the timetable, which set out the tight timetable for the 2023/24 budget process. It was confirmed that service budget meetings had concluded. The Head of Finance stated he was pleased with delivery of those meetings and the discussions that occurred.

On the 17th November – UK Government Autumn Statement was released. This provided the authority with the next two years predicted budget. It was stressed that the best case scenario was a disparity from expected government funding and inflation and demographic pressures.

Sessions for political groups had been arranged to discuss the budget process along with any suggestions or concerns.

A Council workshop had been arranged for the 17^th January to brief members on the potential proposals for the budget settlement for 2023/24 and 2024/25. The proposals had included the use of cash reserves in 2024/25. This would allow time for services to review and sought savings.

Members were guided through the scenarios within the covering report. It was his opinion the likely outcome would be in line with scenario one. Details of the two reserves available for the purposes of supporting the budget were:

– Budget Mitigation Reserve – which currently stood at £4.85m

– Unearmarked reserves – an adopted policy to keep £5m unearmarked

Reserve was observed. Currently the value stood at £7.1m.

Members heard there were a number of factors that could change depending on guidance and figures from Welsh Government. He stressed the importance to begin the work to review and find savings for 2024/25.

The Chair thanked the Head of Finance for the well written report. In response to members comments the following points were discussed in greater detail:

·         Members noted the difficulty and challenges faced by the finance department and praised the work of the officers involved.

·         The proposed potential plan for 2024/ 25 was the RSG would rise by 3.5%, the current proposal included council tax to rise by 3.8%- it was stressed the figure was under review. An increase in fees and charges had been suggested although a number of restrictions were associated with this proposal. It could potentially change during the process.

·         The Head of Finance confirmed he produced a 3-5 year outlook. Future planning can often be difficult to predict due to the reliance on Capital funding.

·         The £5m reserve funding was believed to be an appropriate level of funding. It had been obtained from the analogy of 2% of net revenue expenditure. Within the Statement of accounts, a detailed breakdown of all reserve funding was detailed. This included some funding which was allocated for specific plans.

·         There was a recommended reserve of 4% for the Housing Revenue Account. This was currently under review to potentially be lowered. Income received through this account was mainly from rent so was easier to predict than the level of Capital funding.

·         The national non domestic rate and business rate collection and reallocation was not based on a local collection. Collections were made on behalf of Welsh Government that was pooled together to aid support of the revenue support grant.

·         Consultation with local businesses to provide extra information on the budget would be needed. Public understanding on the budget and services could also be improved. Consultation had been difficult due to the uncertainty of the level of funding that would be obtained.

·         The Visitor Levy was currently in consultation at Welsh Government, Denbighshire had prepared and submitted a response. Concerns from officers had been on the delivery of that potential scheme.

·         Information on the second homes council tax premium would be issued to members imminently. There was no proposed change to the level for 2023/24, which currently stood at an additional 50% tax.

·         Committee members offered support to the Head of Finance, especially when difficult decisions were made. The Head of Finance requested that members keep in mind the financial background when reviewing reports and the potential knock on impact on funding of other services in the council. The level of delivery of services would have to change in the upcoming years. The current level of services would not be an option if the current projections of funding were received in 2024/25.   

Members thanked the Head of Finance for the detailed response to members concerns. Following the discussion, it was;

RESOLVED, that members

     I.        Noted and discussed the latest budget timetable for setting the budget for 2023/24 and 2024/25;

    II.        Noted the latest budget forecasts for the budget position for 2023/24 and 2024/25;

  III.        Agreed to include an update on the Budget Process at the January 2023 meeting.