Agenda item

The Executive RECOMMENDED to Full Council the approval of the Medium Term Financial Strategy and associated Revenue Budget Estimates covering the period 2022/23 to 2025/26, including that

(i)            the 2022/23 budget estimates giving a net cost of services revenue budget for the Council of £14.788 million as shown in Appendix 1 to the Medium Term Financial Strategy be approved;

(ii)          the unavoidable and service pressures of £4.791 million shown in Appendix 1 and in more detail in Appendix 1-1 to the Medium Term Financial Strategy be approved;

(iii)         the revenue efficiencies of £2.413 million shown in Appendix 1 and in more detail in Appendix 1-2 to the Medium Term Financial Strategy be approved;

(iv)         the recommendation by the Strategic Director Finance and Customer Services (the Council’s Section 151 Officer) that a sum of up to £7.500 million of earmarked reserves at this stage be repurposed to the general revenue fund balance to support the revenue budget over the period of the Medium Term Financial Strategy and provide a sustainable budget for the Council be approved;

(v)          authority be delegated to the Strategic Director in consultation with the Chief Executive and the Portfolio Holder for Finance to identify which reserve(s) the sum at (iv) be drawn from and the eventual amount to be re-purposed;

(vi)         the increase in the Surrey Heath Borough Council element of the annual precept be increased by £5.00 per Band D property and in the appropriate statutory proportions for other properties; and

(vii)        a total of £0.270 million of earmarked reserves are allocated to support budgets in the services these earmarked reserves were set aside for.

The Executive RESOLVED to note

(i)            that the Capital Strategy, Capital programme and Treasury Management Strategy, as elsewhere at that meeting, form part of the Medium Term Financial Strategy;

(ii)          the forecast level of reserve balances, as shown at Appendix 4 to the Medium Term Financial Strategy;

(iii)         the forecast level of reserve balances will be subject to confirmation once the outturn position for the 2021/22 financial year, to be reported in the revenue outturn report early in the new financial year;

(iv)         the Council Tax base for Surrey Heath Borough Council is 38,976.2, as agreed in December 2021;

(v)          the Medium Term Financial Strategy contains a savings target of £1.350 million over the period of the strategy, which will be achieved through a combination of further services efficiencies, increases in income and potentially service reductions to be identified through a output-based budget review for all services of the Council and subject to a Star Chamber challenge review that will commence in March 2022; and

(vi)         the statement of the Chief Financial Officer (Strategic Director Finance and Customer Services) on the robustness of estimates and sustainability of balances.

The Executive considered a report setting out the Medium Term Financial Strategy (MTFS), the revenue budgets estimates for the 2022/23 financial year, and the indicative estimates for the period 2023/24 to 2025/26. The MTFS also incorporated a 4-year capital strategy and programme, plus a Treasury Management Strategy, both of which would be considered separately at that meeting.

Members received a presentation from the Chief Finance Officer detailing the key principles and assumptions underpinning the MTFS. A summary of the budget was presented, identifying items of budgetary growth amounting to nearly £4.8m, as well as service efficiencies totalling approximately £2.4m. The sources of finance to support the budget were noted, the primary source of which was Council Tax. The budget included an increase to Council Tax of £5 per Band D property.

Members were advised that the budget gap in 2022/23 was £2.55m. The proposals for reducing the overall budget from approximately £15m in 2022/23 to £13m in 2025/26, thereby reducing the reliance on reserves from £2.5m to £300k in the period of the MTFS, were noted. Further information was requested from Members prior to the Council meeting in relation to the makeup of the efficiencies that were expected to be achieved from the Zero Based Budget process.

The Leader and Finance Portfolio Holder undertook to ascertain further information in respect of apparent discrepancies between information included in the Draft Financial Statements 2019/20 published on the Council’s website and the levels of reserves included in the budget report.

RECOMMENDED to Full Council the approval of the Medium Term Financial Strategy and associated Revenue Budget Estimates covering the period 2022/23 to 2025/26, including that

(i)        the 2022/23 budget estimates giving a net cost of services revenue budget for the Council of £14.788 million as shown in Appendix 1 to the Medium Term Financial Strategy be approved;

(ii)      the unavoidable and service pressures of £4.791 million shown in Appendix 1 and in more detail in Appendix 1-1 to the Medium Term Financial Strategy be approved;

(iii)     the revenue efficiencies of £2.413 million shown in Appendix 1 and in more detail in Appendix 1-2 to the Medium Term Financial Strategy be approved;

(iv)     the recommendation by the Strategic Director Finance and Customer Services (the Council’s Section 151 Officer) that a sum of up to £7.500 million of earmarked reserves at this stage be repurposed to the general revenue fund balance to support the revenue budget over the period of the Medium Term Financial Strategy and provide a sustainable budget for the Council be approved;

(v)      authority be delegated to the Strategic Director in consultation with the Chief Executive and the Portfolio Holder for Finance to identify which reserve(s) the sum at (iv) be drawn from and the eventual amount to be re-purposed;

(vi)     the increase in the Surrey Heath Borough Council element of the annual precept be increased by £5.00 per Band D property and in the appropriate statutory proportions for other properties; and

(vii)   a total of £0.270 million of earmarked reserves are allocated to support budgets in the services these earmarked reserves were set aside for.

RESOLVED to note

(i)        that the Capital Strategy, Capital programme and Treasury Management Strategy, as elsewhere at that meeting, form part of the Medium Term Financial Strategy;

(ii)      the forecast level of reserve balances, as shown at Appendix 4 to the Medium Term Financial Strategy;

(iii)     theforecast level of reserve balances will be subject to confirmation once the outturn position for the 2021/22 financial year, to be reported in the revenue outturn report early in the new financial year;

(iv)     the Council Tax base for Surrey Heath Borough Council is 38,976.2, as agreed in December 2021;

(v)      the Medium Term Financial Strategy contains a savings target of £1.350 million over the period of the strategy, which will be achieved through a combination of further services efficiencies, increases in income and potentially service reductions to be identified through a output-based budget review for all services of the Council and subject to a Star Chamber challenge review that will commence in March 2022; and

(vi)     the statement of the Chief Financial Officer (Strategic Director Finance and Customer Services) on the robustness of estimates and sustainability of balances.