Issue - meetings

It was noted that in accordance with council procedure rule 17.6, a recorded vote would be taken on the motion or any amendments and substantive motions.

It was proposed by Councillor Yates and seconded by Councillor Albon, that the recommendations set out in the report be agreed, namely:

“That Council approves:

1.  The General Fund revenue budget estimates for 2021-22 are approved, assuming a £4.99 increase in the band D equivalent for Council Tax. 

2.  The HRA budget estimates for 2021-22 are approved, assuming a CPI+1% increase in social rents and a freeze in affordable rents. 

3.  The General Fund and Housing Revenue Account capital programmes for 2021-25 are approved. 

4.  The Flexible Use of Capital Receipts Strategy for 2021-22 is approved. 

5.  The Section 151 Officer’s Assurance Statement is noted.”

The Deputy Monitoring Officer conducted a recorded vote on the motion as follows:

45 Members voted in favour the motion: Councillors Albon, Ara, Ashbee, Bailey, Bambridge, J. Bayford, R. Bayford, Boyd, Coleman-Cooke, Crittenden, Currie, Day, Dennis, Dexter, Duckworth, Everitt, Fellows, Game, Green, Gregory, Hart, Hopkinson, Huxley, Kup, Pat Moore, Paul Moore, Ovenden, Parsons, L. Piper, S. Piper, Pugh, Rattigan, Rawf, Rogers, Rusiecki, D. Saunders, M. Saunders, Savage, Scobie, Shrubb, Tomlinson, Towning, Whitehead, Wright, and Yates.

No Member voted against the motion.

Three Members abstained from voting on the motion: Councillors Garner, Roper and Wing.

The motion was carried.

Tim Willis, Deputy Chief Executive & S151 Officer introduced the report and made the following points:

·  The proposed budget was drafted in the context of significant changes on local government financing;

·  Covid-19 had forced local authorities to focus on short term issues. This had drained the council reserves, council finances and council staff reserves;

·  The budget gap in the proposals was largely due to factors internal to the council like pay and contractual inflation an increase in cost of waste disposal;

·  There were some projected reductions in government grants;

·  Any Panel recommendations to amend the budget that have a cost or reduced income would need to be matched with an identified funding source;

·  A correction to paragraph 13.6.1 to the cabinet report – the increase in average rent between this year and next year is £1.98 not £1.89 as reported.

Members made comments and asked questions as follows:

• Members thanked Mr Willis and his finance team for the work done particularly the hosting of briefing sessions for Members;
• 57% of the residents surveyed were surprised at the amount of money that went to the council of the council tax;
• At paragraph 13.7 there were adjustments made for the HRA between the accounting basis and funding basis there is a difference of nearly half a million. What was the basis for that and was there material impact from it?
• At paragraph 11.7 (HRA – Major Repairs Reserve); the table indicates that it was £15.5 million as at 31 March 2020, but will be drawn down to leave £384k by 31 March 2022. Was it a prudent decision to reduce the reserves and was it also prudent to leave such a small amount in the reserves?
• In the same table there was also a movement in 2021/22 of £7.676million, but at Annex 3 it was suggested that £11.986million will be used from the Major Repairs Reserve. Could this be clarified?
• S151 Officer’s view is reported as taking the middle position regarding the budget position to take. What would have the budget looked like had the S151 Officer taken a pessimistic view?
• Why was it that in paragraph 16 Table 9, one bedroom social rent average was indicated as being higher than affordable rent?
• Can the council not use the £3million in the reserves to offset loss in income for not increasing the rent?

Mr Willis responded as follows:

• This adjustment of £479K was required in order to show the complete picture within the HRA. This was to reflect different valuations of assets within the HRA;
• This adjustment did not have a material impact on the overall bottom line as to what rent income required;
• A more comprehensive explanation would be provided after the meeting;
• The council was using a substantial amount of the Major Repairs Reserve to fund the significant investment plan for the HRA stock, in particular the refurbishment of the tower blocks. There will be also be slippages of the capital works as well to consider;
• A combination of bringing East  ...  view the full minutes text for item 273

The budget proposals had been set during a truly unprecedented period for local government. Councils across the country had to continue to support residents and businesses in exceptional ways. The Government had provided substantial funding to assist with Covid test and trace, enforcement and business grants as well as EU transition, but these challenges caused by the pandemic and EU Transition had placed a tremendous strain on the council’s workforce, which itself has been diminished by Covid.

The challenges also placed a strain on local government finances, and Thanet was no exception. Not all Covid losses have been compensated, and there continued to be pressure on the council budgets. Expenditure was higher, to compensate residents and businesses and to protect people through enforcement and temporary housing. Income was lower, in respect of council fees and charges as well as council tax and business rates. The current national lockdown only added to this pressure.

Cabinet observed that it was difficult to assess the full impact of Covid and Brexit on next year’s budget. There should be a reduction in Covid infection rates, nationally and locally, once the vaccines have been rolled out. The worst local effects of Brexit with the impact of Manston being used as a lorry park and latterly, as a testing station should be passing away. However the national and local economic impact will remain for a while longer. Some businesses will struggle to survive as they built up debt and a significant number of people will have lost their jobs. It was unlikely that Thanet will bounce back to its pre-Covid state, at least in the short term.

Despite all this, Thanet was not as worse off as some other councils. Whilst the reserves were relatively low before Covid, council had built up a degree of resilience. A decision had been made not to invest in commercial ventures which are typically dependent on commercial rent. The reserves had gradually grown over the previous five years, and the balance sheet showed a reduction on overall borrowing. Those authorities that were not in a similar position before Covid were now facing much larger budget gaps than TDC’s £840,000.

Cabinet recommended to Council budget proposals that require savings. When considering these savings the priorities would be to minimise the impact on services, especially front line services and to minimise redundancies. Unfortunately, there are up to eight posts that will be deleted from the organisation structure and the staff occupying those posts will be going through a restructuring process. Although it was too early to say, some of those might be subject to compulsory redundancy. Every effort will be made to find alternative council employment for them.

Another objective of the Cabinet was to adopt a transparent approach to setting the budget. As part of the budget build up process, ten budget briefings for small groups of members, as well as two all-member briefings were conducted. Regular sessions were held with Shadow Cabinet.

Cabinet proposed an increase in Council Tax, at  ...  view the full minutes text for item 707