Agenda item

Report of Assistant Director of Finance (S151 Officer)

Purpose of report

This report is the culmination of the Budget and Business Planning process for 2023/24 to 2027/28 and sets out the Executive’s proposed Business Plan and related revenue budget for 2023/24, medium term financial strategy to 2027/28, capital programme to 2027/28 and all supporting policies, strategies, and information to recommend to full Council.

The Council adopts a forward looking and anticipatory approach to its financial management, which was acknowledged by the recent Peer Review in November 2022. The Council plans for, and continues to succeed in, encouraging and facilitating economic growth across the district.  This success flows through to the Council’s finances, reflected in the level of income received from business rates and the New Homes Bonus grant. 

The Council has proactively monitored both the economic situation and Government announcements over the past 12 months and devised and implemented a budget and business planning strategy that has delivered within the constraints identified, consulting on a proposed balanced budget in November 2022.  The Council was able to identify the risk of interest rate rises at an early stage, locking in low interest rates for all of its planned borrowing requirements, meaning only new borrowing requirements will need to be taken at higher rates.

The proposed net budget for the Council is £28.2m, which is an increase of £4.6m from 2022/23.  A Band D Council Tax of £148.50 is proposed for the year which is an increase of £5 compared to 2022/23. The Capital Programme for the period 2023/24 – 2027/28 is proposed to be £35.9m.  The Council plans to fund £2.0m of budget pressures and will deliver £1.0m of savings proposals as part of the 2023/24 budget.

Recommendations           

The Executive is recommended to:

1.1         Delegate authority to the Section 151 Officer (S151), following consultation with the Leader of the Council and Lead Member for Finance, to complete the legal Council Tax calculations once all the information required has been received and submit a separate report to Council.

1.2       Delegate authority to the S151, following consultation with the Leader of the Council and Lead Member for Finance, to make appropriate changes to the Executive’s proposed budget to Council.

The Executive is recommended to recommend to Council as follows:

1.3         Approve the proposed Fees and Charges schedule for 2023/24 (Appendix 7) and statutory notices be placed where required.

1.4         Consider and note the Equality Impact Assessment of the Budget (Appendix 8)

1.5         Approve a pension fund prepayment for the years 2023/24 – 2025/26 of £5.7m.

1.6         In relation to the Business Plan (Section 3.1) to approve:

1.6.1          The Business Plan and Annual Delivery Plan set out in Appendices 1 and 2 respectively.

1.7         In relation to the Revenue Budget (Section 3.2) and Medium-Term Financial Strategy (MTFS) (Section 3.5) to approve:

1.7.1              The net revenue budget for the financial year commencing on 1 April 2023, as set out in Table 3.2.1, and further analysed in the Budget Book provided at Appendix 12

1.7.2              The MTFS and Revenue Budget 2023/24 (Sections 3.5 and 3.2 respectively), including the Savings Proposals, and Pressures included at Appendices 4 and 5 respectively.

1.8         In relation to Council Tax to approve:

1.8.1              An increase in the Basic Amount of Council Tax for Cherwell District Council for the financial year beginning on 1 April 2023 of £5, resulting in a Band D charge of £148.50 per annum.

1.8.2              For long term empty properties, an additional Council Tax premium will be charged of 100 percent for properties empty for two years or more, 200 percent for properties empty 5 years or more and 300 percent for properties empty 10 years or more.

1.8.3              Removal of the 25 percent discount currently available for 12 months to properties that are uninhabitable or undergoing structural repairs.

1.9         In relation to the Capital Programme and related strategies (Section 3.3) to approve:

1.9.1              The Capital Bids and Capital Programme at Appendix 17 and 18 respectively.

1.9.2              The Capital and Investment Strategy 2023/24 (Appendix 19) and revised 2022/23 (Appendix 20) including the Minimum Revenue Provision (MRP) Policy.

1.9.3              The Treasury Management Strategy, including the Prudential Indicators, and Affordable Borrowing Limit for 2023/24 (Appendix 21).

1.10      In relation to reserves to approve:

1.10.1           A minimum level of General Balances of £6m as supported by Appendix 15.

1.10.2           The Reserves Policy (Appendix 14).

1.10.3           The medium-term reserves plan described in Appendix 16.

1.11      In relation to the Pay Policy Statement approve:

1.11.1          The Pay Policy Statement, as required by the Localism Act 2010, detailed in Appendix 9.

Resolved

(1)           That authority be delegated to the Section 151 Officer (S151), following consultation with the Leader of the Council and Portfolio Holder for Finance, to complete the legal Council Tax calculations once all the information required has been received and submit a separate report to Council.

(2)           That authority be delegated to the S151, following consultation with the Leader of the Council and Portfolio Holder for Finance, to make appropriate changes to the Executive’s proposed budget to Council.

(3)           That Council be recommended to approve the proposed Fees and Charges schedule for 2023/24 and agree that statutory notices be placed where required.

(4)           That Council be recommended to consider and note the Equality Impact Assessment of the Budget.

(5)           That Council be recommended to approve a pension fund prepayment for the years 2023/24 – 2025/26 of £5.7m.

(6)           That, in relation to the Business Plan, Council be recommended to approve the Business Plan and Annual Delivery Plan.

(7)           That, in relation to the Revenue Budget and Medium Term Financial Strategy (MTFS), Council be recommended to approve:

                        i.         The net revenue budget for the financial year commencing on 1 April 2023, as set out in the table below and further analysed in the Budget Book.

                       ii.         The MTFS and Revenue Budget 2023/24, including the Savings Proposals, and Pressures.

(8)           That, in relation to Council Tax, Council be recommended to approve:

                        i.         An increase in the Basic Amount of Council Tax for Cherwell District Council for the financial year beginning on 1 April 2023 of £5, resulting in a Band D charge of £148.50 per annum.

                       ii.         For long term empty properties, an additional Council Tax premium will be charged of 100 percent for properties empty for two years or more, 200 percent for properties empty 5 years or more and 300 percent for properties empty 10 years or more.

                     iii.         Removal of the 25 percent discount currently available for 12 months to properties that are uninhabitable or undergoing structural repairs.

(9)           That, in relation to the Capital Programme and related strategies, Council be recommended to approve:

                        i.         The Capital Bids and Capital Programme.

                       ii.         The Capital and Investment Strategy 2023/24 and revised 2022/23 including the Minimum Revenue Provision (MRP) Policy.

                      iii.         The Treasury Management Strategy, including the Prudential Indicators, and Affordable Borrowing Limit for 2023/24.

(10)        That, in relation to reserves, Council be recommended to approve:

                        i.         A minimum level of General Balances of £6m.

                       ii.         The Reserves Policy.

                      iii.         The medium-term reserves plan.

(11)        That, in relation to the Pay Policy Statement, Council be recommended to approve the Pay Policy Statement, as required by the Localism Act 2010.

The Assistant Director of Finance (S151 Officer) submitted a report which was the culmination of the Budget and Business Planning process for 2023/24 to 2027/28 and set out the Executive’s proposed Business Plan and related revenue budget for 2023/24, medium term financial strategy to 2027/28, capital programme to 2027/28 and all supporting policies, strategies, and information to recommend to full Council.

In introducing the report, the Portfolio Holder for Finance explained that the Council adopted a forward looking and anticipatory approach to its financial management, which was acknowledged by the recent Peer Review in November 2022. The Council planned for, and continued to succeed in, encouraging and facilitating economic growth across the district.  This success flowed through to the Council’s finances, reflected in the level of income received from business rates and the New Homes Bonus grant. 

The Council had proactively monitored both the economic situation and Government announcements over the past 12 months and devised and implemented a budget and business planning strategy that had delivered within the constraints identified, consulting on a proposed balanced budget in November 2022.  The Portfolio Holder thanked all who had responded to the budget consultation.

The Portfolio Holder for Finance reported that the Council was able to identify the risk of interest rate rises at an early stage, locking in low interest rates for all of its planned borrowing requirements, meaning only new borrowing requirements would need to be taken at higher rates.

The proposed net budget for the Council was £28.2m, which was an increase of £4.6m from 2022/23.  A Band D Council Tax of £148.50 was proposed for the year which was an increase of £5 compared to 2022/23. The Capital Programme for the period 2023/24 – 2027/28 was proposed to be £35.9m.  The Council planned to fund £2.0m of budget pressures and would deliver £1.0m of savings proposals as part of the 2023/24 budget.

The Portfolio Holder for Finance paid tribute to the Assistant Director of Finance and Finance Officers who worked hard to put together a balanced budget. The comments were echoed by the Leader and Deputy Leader on behalf of Exeuctive.

Resolved

(1)          That authority be delegated to the Section 151 Officer (S151), following consultation with the Leader of the Council and Portfolio Holder for Finance, to complete the legal Council Tax calculations once all the information required has been received and submit a separate report to Council.

(2)          That authority be delegated to the S151, following consultation with the Leader of the Council and Portfolio Holder for Finance, to make appropriate changes to the Executive’s proposed budget to Council.

(3)          That Council be recommended to approve the proposed Fees and Charges schedule for 2023/24 and agree that statutory notices be placed where required.

(4)          That Council be recommended to consider and note the Equality Impact Assessment of the Budget.

(5)          That Council be recommended to approve a pension fund prepayment for the years 2023/24 – 2025/26 of £5.7m.

(6)          That, in relation to the Business Plan, Council be recommended to approve the Business Plan and Annual Delivery Plan.

(7)          That, in relation to the Revenue Budget and Medium Term Financial Strategy (MTFS), Council be recommended to approve:

                     i.        The net revenue budget for the financial year commencing on 1 April 2023, as set out in the table below and further analysed in the Budget Book.

                    ii.        The MTFS and Revenue Budget 2023/24, including the Savings Proposals, and Pressures.

(8)          That, in relation to Council Tax, Council be recommended to approve:

                     i.        An increase in the Basic Amount of Council Tax for Cherwell District Council for the financial year beginning on 1 April 2023 of £5, resulting in a Band D charge of £148.50 per annum.

                    ii.        For long term empty properties, an additional Council Tax premium will be charged of 100 percent for properties empty for two years or more, 200 percent for properties empty 5 years or more and 300 percent for properties empty 10 years or more.

                   iii.         Removal of the 25 percent discount currently available for 12 months to properties that are uninhabitable or undergoing structural repairs.

(9)          That, in relation to the Capital Programme and related strategies, Council be recommended to approve:

                      i.        The Capital Bids and Capital Programme.

                    ii.        The Capital and Investment Strategy 2023/24 and revised 2022/23 including the Minimum Revenue Provision (MRP) Policy.

                   iii.        The Treasury Management Strategy, including the Prudential Indicators, and Affordable Borrowing Limit for 2023/24.

(10)       That, in relation to reserves, Council be recommended to approve:

                      i.        A minimum level of General Balances of £6m.

                    ii.        The Reserves Policy.

                   iii.        The medium-term reserves plan.

(11)       That, in relation to the Pay Policy Statement, Council be recommended to approve the Pay Policy Statement, as required by the Localism Act 2010.

Reasons

This report provides information around the various building blocks that make up the proposed budget for 2023/24 and beyond, allowing members to consider and scrutinise the elements of the budget and provide advice and guidance to Council to help further shape both budget setting for 2023/24 and the MTFS up to 2027/28.

Alternative options

Option 1: To reject the current proposals and make alternative recommendations.  Members will not be aware of the medium-term financial forecast or implications of alternatives if they choose to take this option.