Agenda item

Members agreed that the Council was continuing to face significant cuts in Government funding over the next few years and with substantial savings already having been made in recent years, it is becoming increasingly difficult to identify further savings without impacting on services. The budget proposals present a number of income generating proposals as well as savings, enabled the proposal of a balanced budget for 2017-18 with the minimum impact on services.

The funding pressures were substantial in respect of 2017-18. Government funding had been reduced, primarily in respect of Revenue Support Grant; which has been reduced by £1 million compared to 2016-17 and the New Homes Bonus, which has been similarly reduced by £1 million. After adding in inflationary pressures, the pensions revaluation, and other adjustments, there is forecast to be a gross budget gap of £2.6 million.

Council had already approved increases to fees and charges which will generate an additional £490,000. Further income generation plans were in train for planning, housing, car parking, power generation and the workshop. A new Thanet lottery was also expected to generate net income to fund local good causes, which would otherwise be vulnerable to budget reductions. It was envisaged that efficiencies would also be delivered, reducing the cost of services delivered by contractors and partners, as well as council services.

In light of the substantial reduction in Government funding in 2017-18 and to enable the council to set a realistic, deliverable budget, there is an assumed one-off drawdown of reserves of £450,000. To mitigate risk, the £450,000 will be drawn from earmarked reserves, not the general contingency. Importantly, the £450,000 was projected to be repaid over the period of the Medium Term Financial Strategy, replenishing reserves to their current level.

Members further noted other uncertainties relating to business rates localisation, which would change the nature of funding of local government. There were still very few clues from Government as to how this will be implemented.

Cabinet was also asked to recommend to council an increase in Council Tax of £4.95 on a Band D property, which equates to 2.31%.

Councillor Campbell and Councillor I. Gregory spoke under Council Procedure 20.1.

Councillor Townend proposed, Councillor Stummer-Schmertzing seconded and Cabinet agreed the following:

1.  That Members approve the draft Medium Term Financial Strategy at Annex 1 (of the report);

2.  That Members approve the draft General Fund Revenue budget estimates for 2017-18 to 2020-21 and the resulting budget requirement for 2017-18;

3.  That Members agree to a reduction in the grant to minor preceptors as per section 2.7(to the report);

4.  That Members approve the General Fund and Housing Revenue Account Capital Budgets for 2017-18 as detailed at Annexes 2 and 5(of the report);

5.  That Members approve the Flexible Use of Capital Receipts Strategy as detailed at Annex 3 (of the report);

6.  That Members approve the HRA budget estimates for 2017-18 to 2020-21 and the Housing Revenue Account services charges as shown at Annex 4 (to the report);

7.  That Members approve the level of general reserves be held at £2.011m and the approval of earmarked reserves as identified in Table 5 of the MTFS.