Issue - meetings

Report from the Executive Director – Resources.  (Key decision – reference number 5641)

Cllr Tim Leaver (Cabinet Member for Finance and Procurement) introduced the report of the Executive Director – Resources, providing the first update of the funding and spending assumptions in the Medium Term Financial Plan. This was a forecast. The Council would be looking to address budget gaps.

Responses were provided to Members’ queries in respect of fair funding and on the impact of inflationary pressures.

DECISION:  The Cabinet agreed to:

I.  Note the forecast preliminary budget gaps of:

 - £39.4m in 2024/25, prior to any increase in Council Tax, revision to the Council Tax Support scheme, savings and any additional Government funding.

 - £118.6m gap across the medium term to 2028/29, and the reasons driving the gap, notably high inflation, demography, unprecedented increase in Temporary Accommodation costs, arising from a lack of available property and increasing capital financing costs as interest rates continue to rise.

 - These forecasts are subject to a significant number of variables and estimates and are highly likely to change, but nevertheless represent our best estimates at this time.

II.  Note the scale of the challenge and the need for the organisation to consider different ways of operating in order to remain financially sustainable in the long-term.

III.  Note that in addition to the 2024/25 budget gap, there is a forecast £25.8m overspend for 2023/24 and Executive Directors and officers are implementing mitigating actions to reduce the in-year overspend.

IV.  Note the risk associated with managing the Temporary Accommodation pressure. Reducing the forecast overspend is a Council priority and growth is built into the estimated gap assuming the mitigating actions are successful.

V.  Note the continued prioritisation of increased budget requirement in Adult Social Care and Children’s Services of £12m to meet inflation, demand and demographic pressures.

The report sets out the options considered, if any, and the reasons for the recommendations and the decision.

(Key decision – reference number 5641)