Agenda and minutes

Apologies for absence were received from Councillors Campbell, Hunt, Jenkins and Luggar.

The Chair questioned whether the continuation of the current room layout and meeting arrangements would continue following forthcoming Government changes to the COVID 19 restrictions.

The Director of Resources and Deputy Chief Executive advised that following any changes to Government guidance, the Council had always taken cautious steps in regards to any review. He added that there were no plans to change the current procedures in place for face to face meetings at the current time.

RESOLVED that the minutes of the meeting held on 6th January 2022 (circulated previously) be approved as a correct record and signed by the Chair.

(Please telephone the Corporate and Community Services team to prepare a form for your signature before the meeting. Interests must be re-declared when the item is called, and Councillors must leave the room if necessary).

There were no declarations of interest announced.

Report by the Director of Resources and Deputy Chief Executiveto Strategy and Resources on 7th February 2022 (attached), and

(a)  Minute Extract of Strategy and Resources on 7^th February 2022 (attached).

The Committee considered a report by the Director of Resources and Deputy Chief Executive (circulated previously) regarding the Performance and Financial Management for Quarter 3 of 2021/22 together with Minute Extract of Strategy and Resources on 7th February 2022.

The Accountancy Services Manager highlighted the following:

·         The revenue budget for 2021/22 was approved at Council on 24th February 2021 at £13,639,000.

·         As at 31 December 2021, the latest forecast net budget was £13,550,000, which produced a forecast budget surplus of £89,000. Details are shown in “Appendix A – Variations in the Revenue Budget”.

·         Included within the approved budget a government grant had been factored in, in relation to Covid-19 pressures of £536,710 and also budgeted for £375,000 of additional costs and reduced income, these were already incorporated into Appendix A along with the latest forecast for each service area.

·         The above grant of £536,710 had been approved and received and it was also anticipated that £80,000 re-imbursement for Quarter 1 loss of Sales, Fees and charges, would be received from the continued Government 75% income reimbursement scheme. This has now been revised down to £64,000 and the change incorporated into Appendix A.

·         As at 31 March 2021 the Collection Fund reserve balance was £9,810,252. This earmarked reserve was created to deal with the timing impacts of the Collection Fund (Business Rates), which ensured the revenue budget was not unduly affected in the year the taxes were collected. Collection Fund deficits/surpluses were reversed out to bring the revenue account back to the budgeted figure for the year; the deficits/surpluses were recovered/distributed in the following financial years. This reserve included an £8,660,000 balance that would be utilised in 2021/22 and 2022/23 to mitigate timing differences of business rate reliefs awarded in 2020/21 from an accounting perspective impact over the next two financial years; thus leaving the fund reserve with a residue balance of £1,150,000 protection against future volatility.

·         An additional provision had been included within the forecast figures shown in Appendix A for the National Pay Award potentially being settled higher than the original 1% budgeted amount. Negotiations were ongoing between the Unions and the Employers and the outcome of these discussions would be reflected within the next report.

·         “Appendix B – Movement in reserves and Balances” detailed the movements to and from earmarked reserves in 2021/22.

·         Full details of the Strategic Contingency Reserve movements and commitments were detailed in “Appendix C – Strategic Contingency Reserve”.

·         The 2021/22 Capital Programme was detailed in “Appendix D – Capital Programme 2021/22”.

·         The Budget and Financial Framework report to Full Council on 24 February 2021 outlined the Capital Programme for the 2021/22 financial year of £22,419,916, project underspends were brought forward of £917,121 and further variations of £5,692,492 were approved as part of the performance report changes in year, giving a revised capital programme of £29,029,529.

·         Overall variations of (£5,223,597) were proposed to the 2021/22 Capital Programme as detailed in paragraph 4.4.3 of the report.

·         The overall Capital Programme for 2021/22 to 2024/25 was £47,013,021  ...  view the full minutes text for item 47.

Report by the Director of Resources and Deputy Chief Executive to the Strategy and Resources Committee on 7th February 2022 (attached), and

(a) Minute Extract of Strategy and Resources on 7^th February 2022 (attached).

The Committee considered a report by the Director of Resources and Deputy Chief Executive (circulated previously) regarding the review of Charges and Fees for 2022/23 together with Minute Extract of Strategy and Resources on 7th February 2022.

The Accountancy Services Manager highlighted the following:

·         This year the guidance was to increase some fees and charges by 2%, although some fees were set by statute and these would be set nationally. Other variations to the 2% increase were set out in paragraphs 4.3 to 4.8 of the report. Even though inflation was currently running much higher than the 2% increase officers have tried to be prudent and fair in the fees that were charged and the impact this had on our customers.

·         Building Control fees have been raised by an average of 3% and rounded to the nearest pound, this was to ensure they were competitive in the sector of the market and also that the income recouped the cost of providing the service (detailed in Appendix B of the report).

·         Land Charges fees had been set to recoup the cost of providing the service, without changing the current fees the land charges service was still budgeted to recover all the costs and break even (detailed in Appendix D of the report).

·         There was one change to the Environment Health fees, as the majority of these were set by statute or set to recover costs, which was the introduction of a £10 fee for taxi and private hire driver safeguarding training (detailed in Appendix E of the report).

·         Although it was proposed that the Pannier Market fees be increased by 2% it was proposed to make the charge inclusive of VAT, which enabled the Council to recover the VAT on the planned capital works required for the Pannier Market as part of the Future High Streets Project, which was due to start in 2022/23. Other than the 2% inflationary increase there is no other change to the traders as the loss of income in relation to the VAT change would fall with the Council and this income reduction had been built into the 2022/23 draft budget (detailed in Appendix H of the report).

·         Bulky Waste – it was proposed to increase the fees as follows:

o Up to 2 items £18.00 (5.88% increase)

o Up to 3 items £26.00 (4% increase)

o Up to 4 items £33.00 (3.13% increase).

·         It was proposed to increase the Garden Waste charge by £5 to £45.

·         The net changes in the charges were expected to result in £104,000 of additional income which has been included within the draft 2022/23 budget.

In response to questions from the Committee, the Director of Resources advised the following:

·         With regards to the fees for bulky waste and their cost effectiveness, the Committee was advised that there was still a small subsidy applied by the Council to cover the cost for providing the service.

·         A report was presented to the Strategy and Resources Committee on 7^th February 2022 by  ...  view the full minutes text for item 48.

Report by the Chief Financial Officer to the Strategy and Resources Committee on 7^th February 2022 (attached), and

(a) Minute Extract of Strategy and Resources on 7^th February 2022 (attached).

The Committee considered a report by the Director of Resources and Deputy Chief Executive (circulated previously) regarding the Revenue Budget 2022/23, Capital Programme and Medium Term Financial Strategy 2022-2028 together with Minute Extract of Strategy and Resources on 7th February 2022.

The Director of Resources and Deputy Chief Executive highlighted the following:

·       Government Finance Settlement December 2021. The Revenue Support Grant and baseline funding was predominantly the same as for 2021/22. The Rural Services Delivery grant was same as for 2021/22. The New Homes Bonus (MTFS refresh assumed £812,000 which was legacy payment of £435,000 plus approximately £400,000 for 2022/23. The actual New Homes Bonus award was £1.45m. Lower Tier Services grant of £134,000 had been retained in the funding. The Government had previously advised that this grant would only be received for 2021/22. New “Services” grant had been provided of £206,000 for a one year period only. All Covid 19 additional grant support had been removed. In relation to Council Tax, a referendum was required for Shire Districts if the Authority set an increase of 2% (or more than 2%), or more than £5, whichever was greater. The draft revenue budget for 2022/23 assumed an increase of £5. The overall council Tax income would increase by £244,000 of which £172,000 came from the additional £5 and £72,000 from the increase in Council Tax base. The draft budget factored in £1.750m for retained income growth for Business Rates. The MTFS assumed £1.8m which was made up of £1.2m National Non Domestic Rates growth, Renewable Energy schemes of £400,000 and Devon pool retained income of £200,000.

·       Analysis of national Local Government funding from 2012/13 to 2022/23. Funding had reduced from £28.1billion in 2012/13 to £18.5billion in 2019/20 which was a 34% cut. There had been rises in funding since 2019/20, the largest in 2021/22 to 2022/23 of £2.1billion which reduced the overall cut to 20%.

·       Core Spending Power analysis by region and authority type for England.

·       The MTFS model had been refreshed in October 2021 based upon: the Fair Funding Review which had been planned for 2022/23 had now slipped by one year to 2023/24 and the New Homes Bonus Review that had been planned for 2022/23 which had now slipped to 2023/24. The MTFS refresh had not included: any financial net benefit of further reviews to service areas; income generation and net revenue gains through projects form the Commercialisation Strategy; any new Business Rates growth following the 2023/24 Fair Funding Review; and review and/or price increases to income streams.

·       New Homes Bonus provisional level of funding of £1,451,083 for 2022/23. The level of funding 2021/22 was £1,354,430. The MTFS assumed £812,000 for 2022/23, therefore, there was an additional £639,000 compared to the MTFS. In 2023/24 the projected New Homes Bonus income was £506,000, potential reduction of over £945,000 funding on the current level. There was uncertainty regarding future funding and the scheme design.

·       Business Rates Retention and forecast levels of income for 2022/23 year.

·       Reform of Local Government  ...  view the full minutes text for item 49.

Report by the Chief Financial Officer to Strategy and Resources Committee on 7^th February 2022 (attached), and

(a)  Minute Extract of Strategy and Resources Committee on 7^th February 2022 (attached).

(b)  Appendices A-C to the report (attached).

The Committee considered a report by the Director of Resources and Deputy Chief Executive (circulated previously) regarding the Treasury Management Strategy Statement for 2022/23.

The Director of Resources and Deputy Chief Executive highlighted the following:

·       Capital Prudential Indicators for 2022/23 and the impact of the capital expenditure and financing. In 2021/22, the net financing need for the year was estimated at £18.065m.

·       The Council’s Capital Financing Requirement was a key indicator. The projected Capital Financing Requirement (CFR) for 2024/25 was £35.4m.

·       In the current financial environment it was prudent to use internal borrowing from reserves and cash balances to fund the CFR to offset some of the borrowing need. A further £12m of external borrowing may be required in 2022/23 to support the approved capital programme, taking the total projected external borrowing to £22.5m for 2022/23.

·       From October 2021 the Council entered a vehicle leasing programme with SFS and currently had circa £1.2m of finance leases within the CFR.

·       Two key Treasury Indicators: the operational boundary and authorised borrowing limit. Borrowing interest rates as detailed in the report.

·       Investment Strategy – there were no proposed changes to the investments.

·       Financial limits as detailed in the report and Appendix A.

RESOLVED, that the decisions and recommendations of the Strategy and Resources Committee be endorsed.

Report by the Chief Financial Officer to Strategy and Resources on 7^th February 2022 (attached), and

(a) Minute Extract of Strategy and Resources on 7^th February 2022 (attached).

The Committee considered a report by the Director of Resources and Deputy Chief Executive (circulated previously) regarding the 10 Year Capital Strategy for 2022 to 2032 together with Minute Extract of Strategy and Resources on 7th February 2022.

The Director of Resources and Deputy Chief Executive highlighted the following:

·       The Capital Strategy was a high level review of the corporate priorities, capital investment ambition, available resources, affordability and risk management in the context of ensuring the long term financial sustainability of this authority.

·       The Capital Strategy contained the medium (MTFS) and long term strategies in relation to capital funding and affordability.

·       The Capital Financing Requirement (CFR) was predicted to remain at a high level but would decrease over the longer term.

·       The cost for external borrowing was set to remain above £1.5m for this period.

RESOLVED, that the decisions and recommendations of the Strategy and Resources Committee be endorsed.

To consider the work programme 2021-2022 (attached).

RESOLVED, that the work programme be noted.