Issue - meetings

At its meeting on 6 February 2019 the Executive Committee considered the 2019/20 budget and RECOMMENDED TO COUNCIL that:

1.      a net budget of £8,772,830 be APPROVED;

2.      a Band D Council Tax of £119.36, an increase of £5.00 per annum, be APPROVED;

3.      the use of New Homes Bonus, as proposed in Paragraph 3.5 of the report, be AGREED; and

4.      the capital programme, as proposed in Appendix A to the report, be AGREED.

(If a Councillor intends to move a Motion or Amendment in relation to the Council’s annual budget, the text of the proposed Motion or Amendment must be submitted in writing to the Borough Solicitor by 9.00am on the working day preceding the day of the Council meeting). 

78.1           At its meeting on 6 February 2019 the Executive Committee considered the 2019/20 budget and made a recommendation to Council.  

78.2           The report which was considered by the Executive Committee had been circulated with the Agenda for the current meeting at Pages No. 5-19.

78.3           In proposing the recommendation, the Chair of the Executive Committee explained that, in line with the Medium Term Financial Strategy (MTFS), the budget for the coming year faced a deficit of around £700,000; this was as a result of a combination of factors including cost pressures; growth of service requirements; and further reductions in core government funding of over £200,000. In order to offset the deficit, a number of initiatives aimed at making the Council more self-sustainable had been delivered including: an increase in the garden waste customer base and the fee charged; diversification of treasury investments; rental of spare office capacity in the Public Services Centre; purchase of additional commercial properties; the introduction of Planning Performance Agreements; further use of digital and electronic technologies and channels; and the reorganisation of One Legal to provide an enhanced commercial outlook and additional fee earning capacity. To achieve that additional fee earning capacity, it had been necessary to make changes to the structure of the service. Phase 1 of the One Legal restructure was at management team level with two new posts being created and one deleted; the deleted post had given rise to a redundancy which had incurred a total severance cost of £165,308 – this was split between the three partner Councils of Cheltenham and Tewkesbury Boroughs and Gloucester City, and was made up of a redundancy payment of £34,642 and a pension strain payment to the Gloucestershire County Council Pension Fund of £130,666. Those costs would be met from reserves which were earmarked for the restructure. Although the cost to Tewkesbury Borough Council was £52,421, the total cost was at a level required by government guidance to be voted upon by the Council and it was for that reason an additional recommendation was proposed that the Council approve the severance cost of the Head of Law (Regulatory). In addition to the initiatives outlined, the Chair of the Executive Committee explained that the Borough continued to enjoy growth in both its residential and business sectors and, as a result, there was an increase in the contribution made by New Homes Bonus to support the Council’s core services and an increase to the level of business rates retained by the authority; however, in order to balance the budget, it was, once again, necessary to increase the Council Tax by the maximum amount permissible by central government. The budget proposal, if approved, would require Council Tax to be set at £119.36 per year for a Band D property; however, it was important to note that, even with that increase of 4.37%, Tewkesbury would remain one of the lowest charging District Councils in England and, with the quality of the service it provided to communities, it was  ...  view the full minutes text for item 78

To consider the 2019/20 budget and make a recommendation to Council.

That it be RECOMMENDED TO COUNCIL that:

1.      a net budget of £8,772,830 be APPROVED;

2.      a Band D Council Tax of £119.36, an increase of £5.00 per annum, be APPROVED;

3.      the use of New Homes Bonus, as proposed in Paragraph 3.5 of the report, be AGREED; and

4.      the capital programme, as proposed in Appendix A to the report, be AGREED.

72.1           The report of the Head of Finance and Asset Management, circulated at Pages No. 22-36, set out the proposed budget for 2019/20. Members were asked to recommend the budget to Council for approval along with a Band D Council Tax of £119.36; the use of New Homes Bonus as proposed at Paragraph 3.5 of the report; and the capital programme as proposed in Appendix A to the report.

72.2           The Head of Finance and Asset Management advised that the Council had considered its financial position, as shown in the Medium Term Financial Strategy, at its meeting on 16 January 2019. That Strategy had outlined the budget pressures facing the Council currently, and in future years, and explained that the deficit over the next five years was estimated to be around £3.5 million with a gap of £691,000 suggested for 2019/20. The report currently before Members brought together the general information on the financial climate with the detailed figures associated with the 2019/20 budget, and the work undertaken by the Transform Working Group, and made a proposal for a balanced budget and resultant Council Tax. In setting the budget for 2019/20, the same level of service as in previous years had been assumed; however, future budget-setting may not find increased income and financing streams as plentiful, so it was likely that the Council would be faced with some tough decisions on its operation over forthcoming years, including reducing or stopping some services and taking further risks on its commercial activities.

72.3           A Member suggested that current vacancies in One Legal meant costs would have to increase in the next year to enable it to employ the staff necessary to cover additional income-earning work and she questioned how this would be addressed. In response, the Head of Finance and Asset Management explained that employees had seen a substantial underspend this year. One Legal would be asking for reserves from those underspends to offset savings it could not make due to vacancies and it was felt an equalisation reserve would need to be set up. It was agreed by Members that, whilst it was great to have savings in employee costs, the downside was a decrease in performance if there were not enough staff to deliver the services.

72.4           Accordingly, it was