Agenda item

Report of the Cabinet Member Finance- to follow

The Cabinet Member Finance introduced the report and reminded Members that in February 2018 Members set a challenge to become an enterprising and commercially focused council working towards the objective of financial sustainability by the financial year 2021/22.

In response to the difficult national funding situation, the overriding financial strategy had been, and remained, to drive down the council’s costs. The aim was to hold down council tax as far as possible, now and in the longer term, while also protecting frontline services from cuts which represented an immensely challenging task in the present climate.

The Cabinet Member explained that part of the drive towards financial sustainability included identifying new opportunities to generate income and investment in projects which provided good financial returns. The commercial strategy aligned closely with other key strategies including place-making, economic growth, digital transformation, workforce and skills development, investment and asset management. This had a combined message that Cheltenham Borough Council had entered a new era of business enterprise, growth and innovation.  CBC wished to work with partners who shared our ambition and values and would continue to put the best interests of Cheltenham residents at the heart of everything undertaken.

The key mechanism for carrying out this strategy was the commercial strategy, which sought to bring service costs in line with available funding and sought additional forms of funding.  The development of a new crematoria, and the acquisition of 4 new commercial investment properties (Ellenborough House, Sainsbury’s, Café Nero and 53-57 Rodney Road) had already resulted in over-achieving the new revenue income target. In addition, public realm investment across the town had attracted major new businesses such as John Lewis and Partners which has had a positive effect on both business rates income and vibrancy across the town.

The starting point for the 2019/20 budget has been a projected funding gap of £2.019m. Closing a gap of this size is a huge challenge for the council, but the challenge is being met by a proactive approach to identifying efficiencies and additional income, This work has already made significant progress towards closing the gap, having identified at this early stage potential efficiencies and additional income of £1.621k, leaving £398k to fund from reserves, assuming a 2.99% council tax increase is approved.

The Cabinet Member explained that the outcome of this budget had been based on a number of substantive consultations throughout the year and the public’s views on the strategy for closing the financial gap created by cuts from central government was now sought.

The Cabinet Member gave thanks to the Executive Director Finance and Assets, Paul Jones,  who had met with the Minister to lobby heavily for this authority on the significant difference the negative RSG and proposed changes to new homes bonus would have on Cheltenham. She was pleased to report that the provisional local government settlement proposed no changes to the new homes bonus next year and had provided some additional money for those councils in need. As a consequence, the council had an additional £190k to support the 2019/20 budget proposals.

Finally, she explained that the 2019/20 budget was the result of a great deal of activity and hard work throughout the year and she thanked all involved. She believed this budget would deliver for the residents of the town.

Members welcomed the proposals and paid tribute to the significant investment the council had made in the town which reflected the positive change in approach for the benefit of the town as a whole.

The Leader reminded Members that the budget would now go out for consultation and would be considered by Council in February.

RESOLVED THAT

1.    The interim budget proposals be approved for consultation including a proposed council tax for the services provided by Cheltenham Borough Council of £209.08 for the year 2019/20 based on a band D property (an increase of 2.99%).

2.    The Medium Term Financial Strategy (MTFS) projection, outlined in section 3 and Appendix 3 be noted.

3.    The growth proposals, including one off initiatives at Appendix 4, be approved for consultation.

4.    The proposed capital programme at Appendix 6, as outlined in Section 6 be approved.

5.    Authority be delegated to the Executive Director Finance and Assets, in consultation with the Cabinet Member for Finance, to determine and approve any additional material that may be needed to support the presentation of the interim budget proposals for public consultation which will include any changes arising from the provisional settlement.

6.    Consultation responses be sought by 25th January 2019.