Agenda item

To receive a report on the revised financial projections for the 3 year period 2024/25 to 2026/27 and a proposed budget strategy for setting the budget the 2024/25 (copy enclosed).

The Lead Member for Finance, Performance and Strategic Assets introduced the report (previously circulated). She informed members the report set out the revised financial projections for the 3 year period 2024/25 to 2026/27 and a proposed budget strategy for setting the budget the 2024/25.

Members heard that she was pleased to note the communications plan that was currently being developed. It demonstrated good dialogue with everyone affected by the budget projections.

 

In addition, the Head of Finance stated the report was 3 elements to the paper:

Summary of 23/24 budget setting position;

Revised Budget Projections for 2024/25 to 2026/27 and

Key areas to contribute to the Budget Strategy for 2024/25.

 

Members were reminded that the authority had received a better settlement than expected during 2023/24. It was stressed that although it was better than first thought it did not cover the pressures faced by the authority. Thus resulting in a funding gap of just under £11million. An increase in council tax of 3.8% had helped bridge the gap and generated £2.7million.

A reduction in the amount paid to Clwyd Pensions to contribute to pensions was in a surplus, resulting in a lower contribution sum to be made. This had no impact on individual’s pensions.

Corporate Savings had contributed to funding the gap. The £2 million covid contingency plan had been given up.

 

Monthly monetary reports were presented to Cabinet to report the budget findings. Details of which were made public prior to each meeting.

 

It was stressed the difference between the best case scenario and worst case scenario of the projections going forward was quite a difference. It was stressed to members the uncertainty at present and going forward. Discussions with other Heads of Finance and Section 151 Officers suggested it was a concern across numerous authorities.

 

Members heard an additional pressure of pay offers for non-teachers had been a larger increase in the lower grade staff. It was expected that officers would have to look at the impact of the pay grade system.

 

Members were made aware of key areas of the budget going forward, this was a key area for committee to review and ensure adequate processes were in place to balance a budget for approval by Cabinet and County Council. It was proposed to continue with 1% efficiencies and request and expect services to deliver on those efficiencies. It was also expected services would increase fees and charges in line with inflation in most areas. Other savings would be sought from projects where the delivery of services could be changed. Services had been pre-warned that changes would need to be found and agreed to ensure savings were made. Reducing overspend in areas and services would also be assessed.

Member and staff involvement was encouraged and numerous factors where members could get involved was due to take place. A full Council workshop was scheduled for July to review and discuss the budget and proposals.

 

It was stressed the importance of getting the communication correct given the projected future budgets.

 

Members thanked the Head of Finance for the detailed introduction and presentation of the budget process. He urged members to submit questions to the Head of Finance via email outside the meeting.

 

The following areas were discussed in more detail:

·         Members praised the work that was being conducted to mitigate the potential risks.

·         Members were pleased to hear about officer and member suggestions. The staff suggestion scheme would be offered to all employees within the council. It was stressed not all staff have access to emails on a daily basis.  

·         Some of the large budget projects did not need to be included in 2024/25 those included the flooding schemes along the coast, the revenue needed to be taken into account following the completion of the schemes. The capital plan and its method of funding was being reviewed.

·         Finance for schools was a delegated function, with setting school budgets was a delegated matter. Each cluster had a finance manager to discuss budgets and identify savings or good practice.

·         Refinancing historic loans that had a higher interest rate than current rates became more viable. Treasury management consultants were working with officers to determine if that was financial beneficial.    

·         Officers would review and look where savings could be met to aid balancing the budget.

·         There was an asset strategy stream to look at savings. The options were being developed and would be reported back when finalised. The principal behind the stream was working with partners to bring them into empty office space. One challenge noted was other authorities were completing similar projects.

·         Cross county working was always considered when looking at making savings. Currently the procurement department was a shared service. Discussions on potential service areas that would be more financially beneficial for both authorities would always take place.  

·         The authority was actively exploring devolution to other third parties. They were in the infant stage of discussions; further research was needed of areas that could be outsourced.

·         Services had been asked to review the impact of the service given the savings required and the impact that would have on delivery of services. All areas would need to be reviewed when looking at savings to balance the budget.

·         There were three categories of savings – efficiencies, savings and cuts to a service. Historically officers had tried to ensure savings were sought through efficiencies and savings within services.

 

The Chair thanked the officer and Lead Member for the detailed discussions and encouraged members to contact the Head of Finance with any concerns or questions.

 

RESOLVED, that members note the revised financial projections for the 3 year period 2024/25 to 2026/27 and the committee note the budget strategy agreed by Cabinet for setting the budget for 2024/25.