Agenda item

Members gave consideration to a report which presented the Executive Business Plan 2022/23 and the Medium Term Financial Plan (MTFP) 2022/23 – 2026/27 presented by the Section 151 Officer.  These documents were central to the Council’s financial and strategic planning for the period 2022/23 to the 2026/27 and also included the Council Tax requirement for 2022/2023.

 

The Executive Business Plan, provided the context in which the Authority was working, with both national and local factors and detailed the work to be carried out over the next 3 years to support delivery of the Council’s Corporate Plan Objectives.

 

The Medium Term Financial Plan, explained the Authority’s financial strategies over the medium term, and the budget forecasts to support sustainable service delivery and funding for initiatives to deliver the Corporate plan through revenue and capital investment. 

 

The Treasury Management Strategy, brought these elements together to enable management of the Authority’s  cash flows through investment and borrowing and ensured that Capital Investment decisions were both affordable and sustainable. 

 

Members were advised the overall capital financing requirement was £38.2m and that this would reduce over the medium term as minimum revenue provision (principal repayments were made). 

By the end of 2022/23 the external borrowing was forecast to be £26.5m with internal borrowing of £11.74m. 

 

Members were also advised that there had been a change to the MRP policy, which would result in a charge to reduce prudential borrowing against investment assets.  This change had been made in anticipation of a change in legislation in this regard.

 

The Budget for 2022/23 had been based on a Council tax increase of £5 which continued the Council’s long-term aim of being non-reliant on Government funding.  The average West Lindsey District Council Tax for 2022/23 would be £227.74 reflecting a 2.24% increase, with the overall average Council Tax (including Lincolnshire County Council, the Police Crime Commissioner and Parish Precepts totaling £2,011.40, an overall 4.45% increase.

 

Whilst the Government had provided a 1 year financial settlement, additional funding in the form of a £208,000 Services Grant and an additional year of New Homes Bonus totaling £841,000 would be earmarked for future investment. 

 

The 1 year settlement meant ongoing uncertainty remained in relation to future funding levels. Both the Fairer Funding and Business Rate Retention Scheme reviews were awaiting finalisation as part of the Government’s overall review of  Local Government funding. 

 

Assurance was given that the Council would remain proactive in delivering it’s Financial Strategy over the medium term, with the aim of long term sustainability. This would be achieved through good financial management, investment for growth of its tax base, service reviews, investment in technology and a commercial approach to delivering services.

 

Financial gains from the 2022/23 had been achieved as result of the Council being allowed to retain a further year of business rates growth and it had also benefitted from a further year of New Homes Bonus, this had enabled the Authority to increase its reserves to support delivery of the corporate strategies (£1.175m).

 

£0.562m had been earmarked for investment in technology, property assets and change management.  The capital investment programme totalled some £33m over the medium term, £17m of which was currently in delivery with business cases and approval required for the remaining projects. The significant programme had been enabled by £22m of grant funding of which £10m has been awarded from the Levelling Up Fund for our Thriving Gainsborough Project, which would provide beneficial outcomes for the wider District.  £6m of earmarked reserves would be utilised, along with £4m of capital receipts and £2m of borrowing to deliver the programme. 

 

The Chief Finance Officer’s opinion on the robustness of the estimates within the Budget, the adequacy of the reserves to support ambitions and to provide contingencies for future financial risks and sustainability was contained with the report.

 

The Governance and Audit Committee had scrutinised the Treasury Management Strategy and both the Prosperous Communities Committee and the Corporate Policy and Resources Committee have considered and recommended their budgets and fees and charges as contained within the report.

 

The Leader made the following address

 

“As Leader of the Council I am pleased to present our Executive Business Plan and Medium Term Financial Plan, along with the Budget for 2022/23, all of which contribute to achieving our vision of making West Lindsey a great place to be where people, businesses and communities can thrive and reach their potential.

 

The Financial Strategy supports our ongoing aim to be non-reliant on Government funding.

 

The 2022/23 budget has been set to ensure we continue to provide award-winning services, whilst investing for the future through the delivery of the capital programme.

 

The 2022/23 settlement has enabled us to build up our reserves to support delivery of our corporate strategies and we now have available:

 

·       £250,000.00 for Culture

·       £500,000.00 for Environmental and Climate Change

·       £250,000.00 for Communities at Risk

·       £6,000,000.00 for Investment for Growth

·       £250,000.00 for cost of change

 

A further £250,000.00 has been allocated for investment in technology and £250,000.00 to support the Asset Management Plan, with £62,000.00 to support change management.

 

The 2022/23 Budget supports delivery of our Corporate Plan objectives, protects our award-winning services, improves our customers’ experience, delivers efficiencies and will continue to deliver value for money for the residents of West Lindsey.

 

I therefore commend these measures to Council and am delighted to propose the recommendations”.

 

Thank you Chairman.”

 

Debate ensued and Members’ posed a number of questions to the Section 151 Officer. Given some Members’ understanding that the West Lindsey Leisure Centre Swimming Pool in Gainsborough was either reaching or had reached, the end of its anticipated life expectancy, information was sought as to what, if any, plans there were to renovate or rebuild the swimming pool in Gainsborough? Whether estimates of the cost of these works had been made, noting that there did not appear to be reference in the Mid-Term Financial Plans.

 

In response the Section 151 Officer advised that the last condition survey of the building had concluded the building was still fit for purpose and had longevity, with no significant issues.  Officers however were conscious that it was an ageing building, with facilities likely to require refurbishment. Work was required to determine to what extent works were required in order to ascertain any future investment need, which would be built into future asset management plans so they could be costed.

 

Arising from the Environment Act of last year, DEFRA was currently undertaking consultation regarding the conversion of waste vehicles to more environmentally sustainable models, with the likely implementation date for any change-over date being March 2025, general consensus at a recent meeting that that was not a flexible date. Confirmation was sought as to whether any estimates of that cost to the Authority had been undertaken and incorporated into the MTFP.  Again in response the Section 151 Officer advise Members that no costs had been built into the MTFP at this time. However the Action Plan arising from the Council’s Climate and Sustainability Strategy did include a figure of approximately £6m, as the required amount to convert the current fleet   The funding of which, would be difficult and exploration was currently underway as to ways the Climate and Sustainability Strategy could be financed. 

 

 

Reference the internal audit plan due for consideration at a forthcoming Governance and Audit Committee, it was noted there had been an 18% rise in the fees charged by internal auditors, whilst noting the fee had not risen in 5 years, this had however seen the number of audit days applied reduced from 185 days to 166 for next financial year.  The likely impact being that some of areas of interest for the Governance and Audit Committee may not be included within the Plan.  It was requested whether the budget could be amended to include an additional 20 audit days at a cost of around £6k?

 

In response the Section 151 Officer advised the Council did hold a general fund working balance.  As such if additional audit days were deemed necessary they could be funded via such means, with the ongoing base budget reassessed for future years’ requirements.

 

Finally mention was made to the global economic impacts arising from the Russian invasion of Ukraine, not only consumer commodities but on investments.  Information was sought as to what if any assessment of such impacts had been undertaken.

 

Members were advised that the Lincolnshire Treasury Management advisors would be providing updates to Councils regularly.  A review of the Council’s own investments, including those on Money Market Funds, had been undertaken to ascertain whether those investments had any Russian links.  Based on public information available the Council did appear to have any such investments, however formal confirmation was awaited from the Authority’s Financial Institutions.  Interest rates were expected to fluctuate over the medium term and the impact of this could not currently be estimated.  The Council did hold reserves for such fluctuations should projected returns not be reached.

 

Having had the recommendations, as set out in the report, moved and seconded, they were put to the vote. In accordance with required legislation for voting on the Council’s budget, a recorded vote was taken.

 

Votes were cast as set out below:

 

For: - Councillors Bierley, Devine, Ellis, Fleetwood, Grimble, Lawrence, McCartney, McNeill , Milne, Morris, Panter, Patterson, Summers and Welburn(14)

 

Against: - Councillor Cotton, (1)

 

Abstain: - Councillors Boles, Bunney, Clews, Dobbie, Oliver, Rainsforth, Rollings, Snee J, Snee M, White and Young  (11)   

 

With the majority of Councillors voting for the proposals, the recommendations were declared CARRIED and on that basis it was:-

 

RESOLVED that: -

 

(a)        Members recognise the external environment and the severity of the financial challenges being faced as detailed in the Financial Strategy

 

(b)        the Statement of the Chief Finance Officer on the Robustness of Estimates and Adequacy of Reserves. (MTFP 2.10) be accepted;

 

(c)        the Medium Term Financial Plan 2022/23 to 2026/27 be approved with an awareness of the associated Risks (Appendix 2);

 

(d)        a Mid-Year Review of the Medium Term Financial Plan be submitted to Council during 2022/23;

 

 (e)       a £5 increase in the Council Tax to £227.74 (Average Band D equivalent) (Appendix 8-12) be approved;

 

(f)         the Revenue Budget 2022/23 (MTFP 3.2) be approved;

 

(g)        the Movement in Reserves (MTFP 2.8) be approved;

 

(h)        the Fees and Charges 2022/23 as detailed in Appendix 3 be set;

 

(i)         the Capital Investment Strategy (Appendix 4) be adopted;

 

(j)         the Capital Programme 2022/23 to 2026/27 and proposed financing (Appendix 5 and 6) be approved;. 

 

(k)        the Treasury Management Strategy 2022/23 be approved and the Treasury Investment Strategy, the Borrowing Strategy and the Treasury and Borrowing Prudential Indicators (Appendix 7) be adopted;

 

(l)         the Minimum Revenue Provision (MRP) Policy as contained in the Treasury Management Strategy (Appendix 7) be approved; and

 

(m)       the 2022/23 Pay Policy Statement (Appendix 13) and Human Resources Statement 2022/23 (Appendix 14) be approved.