To discuss with the Executive Member for Transformation and Finance, and the Borough Treasurer the current budgetary position, in preparation for scrutiny of the 2016/17 budget proposals.
The Executive Member for Transformation & Finance and the Borough Treasurer presented the Council’s current budgetary position, in preparation for scrutiny of the 2016/17 budget proposals.
The Government pledge was to eliminate the national deficit by 2019/20, and most would be achieved through reductions in public spending. Health, education and overseas aid had been protected in the past. Defence would be protected as well in future. Real term reductions of 25% or 40% over 4 years were being explored, and this followed 5 years of austerity. Local government and Bracknell Forest needed to play its part.
Budget Strategy: Underlying Principles: Recognition of political priorities, for example, ‘clean and green’; Efficiencies and savings would be taken as early as possible and would not be constrained by financial years; Savings would be focussed on efficiencies and the back office with the impact on front line services to be minimised; Twin track immediate savings and transformational change; Reserves and balances would be used in a measured way to facilitate the implementation of savings; and Business rates from the regenerated town centre and council tax from housing growth would help to bridge the budget gap.
Key planning assumptions included: a grant reduction in 2016/17 of £3m; a reduction of 6% in government support for each of the remaining 4 years; a pay award of 1% each year; general inflation (CPI) to be below 2% throughout the period and only approaching this level in 2-3 years; pressures consistent with previous years (£2.0m); and a Council funded core capital programme of £8m each year. There was a budget gap of £25 million over the next 5 years.
Bridging the gap for the 2016/17 budget would involve taking a firm line to limit future year’s pressures but, they reflected demographic changes and increases in demand for services; increasing Council Tax by 1% would generate £0.5m; a referendum for excessive increases (2%+?); Utilising balances such as £7.0m of accumulated business rates surplus plus £10.0m of general fund balances; £4.0m minimum prudent balance; £13.0m available but only delay the need for alternative measures
Identifying savings such efficiencies, back office or front line services; reducing or stopping non-statutory services.
Budget risks included: Local government finance settlement; New Homes Bonus/Referendum criteria; Waste Tonnages; Looked After Children; Deprivation of Liberty Safeguards; Business rate appeals and revaluation in 2017; and the impact of the living wage. There was a contingency of £1 million but this would be reviewed following the settlement received.
24 September 2015 Overview & Scrutiny Commission – Budget Prospects
25 November 2015 Spending Review
15 December 2015 Executive – approves budget package for consultation
Late December 2015 Provisional Finance Settlement
28 January 2015 Overview & Scrutiny Commission – review budget proposals
End January 2015 Consultation Closes
9 February 2015 Executive recommends budget to Council
24 February 2015 Budget and Council Tax agreed
In response to Members’ questions, the following points were made: