Agenda, decisions and minutes

Members are asked to declare any interest and the nature of that interest which they may have in any of the items under consideration at this meeting.

There were no declarations of interest.

To confirm as a correct record the minutes of the meeting held on 26 September 2023.

The minutes of the meeting held on 26 September 2023 were agreed as a correct record and signed by the Chairman.

To receive communications from the Chairman.

The Chairman advised that she had agreed to re-order the agenda. Agenda item 8, Budget Consultation, would be brought forward and heard before agenda item 6. The rest of the agenda order would stay the same.

The Chairman to advise whether they have agreed to any item of urgent business being admitted to the agenda.

There were no items of urgent business.

The Assistant Director of Customer Focus will give a presentation on the process of how the Council’s budget consultation is prepared and undertaken.

Recommendation

The meeting is recommended:

1.1   To note the presentation.

Resolved

(1)      That the presentation be noted.

The Assistant Director Customer Focus gave a presentation on how the council’s budget consultation was prepared and undertaken.

The Assistant Director Customer Focus explained that the budget consultation would explain the council’s budget situation and what the budget gap was. The budget proposals put forward intended to minimise the impact on residents whilst bridging the budget gap.

The Assistant Director Customer Focus advised that the consultation approach would differ from the previous year as each proposal listed in the questionnaire would require the respondent to tick whether or not they agreed with the saving proposal. If a proposal was not supported, the respondent would be asked to provide reasons and have an opportunity to suggest alternative proposals to bridge the budget gap.

The consultation would be promoted through the council’s regular communication channels. The availability of alternative formats on request would be advertised.

Resolved

(1)      That the presentation be noted.

Presentation by Adrian Jenkins of Pixel, an organisation the Council uses for intelligence and modelling of business rates and council tax, to give an overview of council funding, including central funding, business rates & other income.

Recommendation

The meeting is recommended:

1.1   To note the presentation.

Resolved

(1)      That the presentation be noted.

The Chairman advised that further to a request at the previous Budget Planning Committee, Members would receive presentation on local Government finance.

The Head of Finance explained that local Government finance was currently made up of four key elements: council tax, business rates, new homes bonus and revenues support grant. Forecasting these elements for the Medium-Term Financial Strategy (MTFS) was complicated and the council therefore used Pixel Financial Management, a funding advisory service that advised the council on modelling of business rates and council tax.

The Head of Finance, introduced Adrian Jenkins, Founder and Chief Analyst of Pixel Financial Management, who gave a presentation which provided an overview of council funding, including central funding, business rates and other income.

Adrian advised the Committee that for councils to forecast what would happen was difficult due to planned changes not taking place as expected and subsequently not knowing when they would take place. For example, changes to business rate retention and no full four year run of spending reviews since 2015.

Adrian advised that the Consumer Price Index (CPI) determined a lot of funding within local government and was the measure to set the business rate multiplier and increase revenue support grant. The CPI for September 2023 was 6.7% which meant there would be a 6.7% increase in core grants received however other aspects remained above CPI. Therefore, even though there will be an increase in core grants received there will likely be larger pressures from inflation in public sector pay awards.

Adrian explained that there had been big increases in social care grants with £80million taken from local government service grants being put into social care grants. This meant that council’s without social care responsibilities would receive a reduced service grant.

The Committee was advised that the local government finance settlement for  2024/25 would be announced in mid-December as had been the case in previous years, which did not assist council’s in their own budget setting. A policy statement was released by the Government prior to the provisional settlement which did not include exact figures but provided an overview of what would be included.

Adrian explained that it was expected that CPI would fall relatively  quickly in the coming months so the Government should meet its goal of halving inflation by the end of year.

Adrian Jenkins explained that the Institute for Fiscal Studies (IFS) had advised that over the next four-year spending review period from 2025/26, public sector spending would increase by 1% in real terms but it was anticipated this would be in areas such as social care, defence and the NHS so may lead to  reduced spending in other areas, including local government.

In response to a question regarding the plan to push back the reset of the Business Rates baseline, Adrian advised that 2026/27 was the first year that it could happen, however this would be dependent on whether whomever formed a Government following the General Election was prepared to use political capital to put through the  ...  view the full minutes text for item 23.

Report of Assistant Director of Finance

Purpose of report

This report summarises Cherwell District Council’s (CDC’s) forecast revenue and capital outturn for 2023/2024 as at 31 August 2023 to give the Committee the opportunity to consider the finance aspects of the report.

Recommendations

The meeting is recommended:

1.1       To note the contents of this report.

Resolved

(1)      That the contents of the report be noted.

The Assistant Director of Finance submitted a report that summarised Cherwell District Council’s (CDC’s) forecast revenue and capital outturn for 2023/2024 as at 31 August 2023.

The Portfolio Holder for Finance, Councillor Nell, explained that the revenue outturn position for 2023/24 was currently forecast as an overspend of £0.656m. Planning and Development had the top variance, 31.9% due to income projections being lower than expected and agency costs.

In relation to the capital budget, the Portfolio Holder for Finance advised that there was a forecast in-year underspend of £7.165m of which £7.121m was to be reprofiled into future years due to changes in programme timetables. There was an overall forecast decrease in the total cost of schemes.

Resolved

(1)      That the report be noted.

To review the Committee Work Plan.

Resolved 

(1)      That the update on the Committee Work plan be noted.

The Strategic Business Partner – Business Partnering & Controls gave a verbal update of the committee work advising that at the next scheduled meeting on 31 October 2023, the Committee would consider 2024/25 Budget Proposals for Revenue and Capital and Fees and Charges.

Resolved 

(1)      That the update on the Committee Work plan be noted.