Agenda item

Report of the Cabinet Member Finance- TO FOLLOW

The Cabinet Member Finance introduced the report and explained that there was no verifiable evidence about whether the provisional local government finance settlement would be either before or after Christmas. 

That said, interim budget proposals for the financial year ahead still needed to be prepared and the consultation process should take place for no less than four weeks prior to finalising recommendations for the Council to consider in February 2020.

The report set out the interim proposals for 2020/21. The assumptions within the interim budget proposals were based on the technical consultation on the local government finance settlement for 2020/21 which was released by MHCLG after the Spending Review 2019 (SR19) was published in September 2019. The council’s response to the technical consultation was submitted on 31st October 2019.

The Cabinet Member reported that the council’s approved Medium Term Financial Strategy (MTFS) was predicated on the basis that council tax would increase by 2.99% per annum. However, the proposal to retain business rates growth achieved between 2013 and 2020 for a further year alongside a continuation of the removal of negative revenue support grant should have a positive effect on the councils funding in 2020/21.

The MTFS assumed legacy payments for new homes bonus (NHB) would be honoured, however, a continuation of the same methodology for a further year could equate to an additional £301k funding in 2020/21.

The projections for additional new homes in the Borough were estimated to be 350 per annum and this figure was used to calculate NHB. The actual number delivered over the last 12 months was an additional 423 new homes for occupation. With a baseline target of 0.4% this meant CBC would only receive NHB for 215 additional new homes.

The Cabinet Member Finance reported that in previous years, budgets have been prepared under a general philosophy of no growth in services unless there was a statutory requirement or a compelling business case for an ‘invest to save’ scheme. However, the Council’s aspirations to modernise its offer, become financially sustainable and be carbon neutral by 2030, required realignment of resources to deliver the outcomes.

She reminded Members that an allocation was agreed by Council in April 2015 to facilitate the redevelopment to the Town Hall. She referred to the briefing note attached to this Cabinet agenda which outlined the progress made to date but which concluded that all of the options identified were currently outside the financial envelope of affordability available for the Council to progress.

She explained that of the original allocation, £1.6m was still available and the Cabinet was recommending the following reallocation:

·         Invest a sum of £1m to pump prime the commercial opportunities identified by The Cheltenham Trust including investment which both sustains and grows income at the Town Hall);

·         Allocate £50k to fund 2 full-time documentation officers to ensure the collection receives accreditation status,

·         Allocate £200k in a contingency fund to fund the associated costs of the investment in leisure@ in respect of the splash-pad;

·         Allocate £350k to a climate emergency fund to help facilitate the Council’s ambition to become carbon neutral by 2030.

The Cabinet Member referred to the Climate Emergency declared by Cabinet in July 2019 in response to a motion agreed by Council. As part of the motion, Council requested that a report be presented back within six months, with the local actions the Council could take to help address this emergency. A report was presented to Full Council in October 2019 outlining the actions needed and an indicative timetable, as well as recommending the initial resources required for the authority to effectively gear up to delivering the scale of actions required by 2030. There was widespread public support for addressing climate change issues with more than four in five Cheltenham residents agreeing that the Council should play a role in tackling air quality issues (83%), enabling people to walk/cycle more (82%) and enabling public transport use (81%).

The report recommended initial ‘seed funding’ of £150,000 per year, to fund additional staffing resources in order to create the capacity and capability to develop the business cases for the initiatives outlined in the roadmap and to identify and secure external funding to enable climate emergency projects to progress. She therefore proposed that Cabinet allocate £350k from the original Town Hall allocation to address the resources required. In addition she proposed to allocate £75k from the planned maintenance reserve (originally allocated to the restoration of Pilley Bridge) on the grounds that it needed to prioritise its resources to the delivery of corporate plan priorities.

The Cabinet Member Finance then referred to the need to ensure that the technology which supports the delivery of services provided by Ubico, particularly domestic and trade waste collections, was in place and can integrate with other business systems as necessary including any Customer Relationship Management (CRM) system CBC may purchase going forward.

The Cabinet therefore proposed to allocate £200k, subject to a business case, for the purchase of an ‘In Cab’ technology system. She reported that it was anticipated that the implementation of this system would offer a number of financial, service related and carbon reduction benefits to the council and its residents.

The future provision of public conveniences report was presented to Cabinet on in November 2019. Recognition for redeveloping the toilets at Sandford Park was identified within this report, with a recommendation to set aside funding for a new facility within the 2020/21 budget proposals to be considered by Council in February 2020. In order to satisfy that commitment, the budget proposals included a sum of £143,500 in the proposed capital programme for 2020/21.

Finally, the Cabinet Member Finance wished to put on record her thanks to all officers who had contributed to bringing the report forward. She paid particular thanks to the Executive Director Finance and Assets who as Acting Returning Officer was also occupied with the general election.

The Cabinet Member Finance referred to the proposal for the Town Hall which would enhance the performance space and attract a bigger audience on a regular basis. Additional income would be reinvested into the Trust to ensure its sustainability. She wished to put on record her thanks to the Director of Corporate Projects for his significant contribution to this work.

The Leader acknowledged the difficult circumstances in which this budget was being proposed, both in terms of timing with the general election and lack of the formal settlement and money available.

RECOMMENDED THAT

1.    The interim budget proposals be approved for consultation, including a proposed council tax for the services provided by Cheltenham Borough Council of £214.08 for the year 2020/21 based on a band D property (an increase of 2.39% or £5.00 a year for a Band D property).

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

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

4.    The proposed capital programme at Appendix 6, as outlined in Section 7, 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 20^th January 2020.