Chichester District Council
Agenda item

Agenda item

Financial Strategy and Plan 2020-21 to 2024-25

The material relevant to this item is the report on pages 17 to 22 of the Cabinet agenda for 5 November 2019 and pages 33 to 51 of the Supplement to the Cabinet agenda for 5 November 2019.

 

The following recommendations were made to Council:

 

1.    That the key financial principles and actions of the five year Financial Strategy set out in appendix 1 to the agenda report be approved.

2.    That the current five year Financial Model detailed in appendix 2 and the Resources Statement in appendix 3 to the agenda report be noted.

3.    That, having considered the recommendations from the Corporate Governance and Audit Committee, the Minimum Level of the General Fund Reserves is set at £6.3 million.

Minutes:

The Chairman invited Mr Wilding to introduce the report and referred members to pages 17 to 22 of the Cabinet agenda for 5 November 2019 and pages 33 to 51 of the supplement to the Cabinet agenda for 5 November 2019.

 

Mr Wilding explained that the report updates the Financial Strategy and Plan for 2020/21 and creates the framework for how the council’s budget and council tax is set which will be considered by the Cabinet in February 2020. The 2020/21 financial strategy is set in the context of current political uncertainty and the continuing expectation of reduced central government funding for local government. The major changes that were expected to come in from the 2020-21 settlement have been delayed by a year, so now the 2020-21 settlement will be for one year only. Due to the delay the council will retain the business rates growth achieved so far for one year longer than anticipated. Much of the council’s other income remains dependent on the local economy and is therefore less predictable.

 

Mr Wilding outlined Appendix 1 which describes the council’s key priorities, one of which is to manage its finances prudently and effectively. He explained that the financial strategy is linked to this specific priority along with the council’s key financial principles that underpin the Council’s financial planning approach. Appendix 2 outlines the updated 5 Year Financial Model, reflecting the consolidated budget from the service areas, central government funding and the most up-to-date estimates for the wider council activities. There are a number of estimates contained within the Model including the assumption of a 2% increase in council tax each year. However, Mr Wilding explained that low taxing local authorities like Chichester District Council may be allowed to set a £5 increase in council tax. The final decision on the council tax rates will be made by Full Council in March 2020.

 

Mr Wilding then referred to the assumptions relating to pensions, West Sussex County Council cuts and the New Homes Bonus scheme and how it is likely that the Financial Model will continue to evolve. He then outlined Appendix 3 which sets out the anticipated resources position of reserves and assets in the medium term and confirmed that the capital programme remains affordable without the need to borrow.

 

Mr Hughes commented that a number of grammatical errors within the document. He gave examples relating to Outside Bodies and Investment Strategy. He also drew attention to the Brexit deadline which required updating. He explained that he was unhappy to support the document given the amendments required. Mr Ward clarified the reference to Outside Bodies referring to the number of examples across the council where Outside Bodies are used and the extensive shared services exercise across a number of services. With regard to investment strategy he confirmed that members had been invited to Treasury Management training on 16 December 2019 and the Treasury Management Strategy would come to Full Council for sign off next year. With regard to the general wording of the document he explained that often financial jargon is used. He then drew attention to the fact that the document had already been through Corporate Governance and Audit Committee and the Cabinet.

 

Mr Brown then requested that members consider the intention of the Policy and suggested that it should not be refused on the grounds of grammatical error. He added that officers could be asked to clarify the sentences where necessary.

 

Mr Hughes responded that it would be difficult to sign off on a document which contained a number of errors.

 

Mr Hobbs commented that the errors are textual and did not affect the main focus of the document.

 

Mr Wilding proposed the recommendations which were seconded by Mrs Lintill.

 

In a show of hands the Council voted in favour. Four members chose to abstain from the vote.

 

RESOLVED

 

1.    That the key financial principles and actions of the five year Financial Strategy set out in appendix 1 to the agenda report be approved.

2.    That the current five year Financial Model detailed in appendix 2 and the Resources Statement in appendix 3 to the agenda report be noted.

3.    That, having considered the recommendations from the Corporate Governance and Audit Committee, the Minimum Level of the General Fund Reserves is set at £6.3 million.

 

Supporting documents:

 

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