Decision details

To make recommendations to the County Council on the revenue and capital budgets for 2017/18 to 2021/22 and the level of council precept for 2017/18.  

To note the following important features of the revenue and capital budget:

1.         The Director of Finance has produced two statutory conclusions as follows.

a.   For the proposed budget: that the council’s budget is balanced and sustainable over the long term, although still requiring significant service transformation and efficiencies.

b.   For the substitute budget: that the budget can only be balanced and become sustainable through the identification of substantial and permanent further service reductions for implementation in 2017/18 and subsequent years.

2.         The requirement for the council to approve a substitute budget, with a council tax rise of 4.99% that will be implemented if the proposed budget in not supported in a referendum.

3.         The findings of the Financial Resilience Review completed in November 2016.

Cabinet recommendations to Full County Council on the revenue and capital budget:

4.         Increase the level of the general council tax by 1.99% and an additional 10% (35p per day) as a result mainly of social care pressures, making a total general council tax increase of 11.99%.

5.         Increase council tax by a further 3% for the adult social care precept, which will provide £18m to support the growth in demand for services.

6.         Set the County Council precept for band D council tax at £1,458.45 which represents a 14.99% up-lift.

7.         Agree to maintain the council tax rate set above after the Final Local Government Financial Settlement.

8.         Delegate powers to the Leader and the Director of Finance to finalise budget proposals and recommendations to Full County Council updated to take into account new information.

9.         Require the Chief Executive and the Director of Finance to continue their work to ensure delivery of planned efficiencies and service reductions.

10.       Approve the County Council’s £1,696m gross revenue expenditure budget for 2017/18 for the proposed budget.

11.       Note that the existing revenue costs of funding past capital spending decisions is £30m for 2017/18.

12.       Agree up to a total of £408m funding for capital schemes that funds essential schemes over the next three year period (schools and non-schools), including ring-fenced grants and a borrowing requirement of £94m over the three years.

13.       Note that the detailed programme of schemes will be agreed at the March 2017 Cabinet as part of the Medium Term Financial Plan.

14.       Require a robust business case to be prepared (and taken to the Investment Panel for review) before committing expenditure for the use of:

·       all revenue ‘invest to save’ proposals, and

·       capital schemes.

Cabinet recommendations to Full County Council on the revenue and capital substitute budget:

15.       Increase the level of the general council tax by 1.99%.

16.       Increase council tax by a further 3% for the adult social care precept, which will provide £18m to support the growth in demand for services.

17.       Set the County Council precept for band D council tax at £1,331.55 which represents a 4.99% up-lift.

18.       Approve the County Council’s £1,666m gross revenue expenditure budget for 2017/18 for the substitute budget.

19.       Require the Chief Executive and the Director of Finance to continue their work to ensure delivery of planned efficiencies and service reductions.

20.       Agree to support only capital schemes which are funded without requiring borrowing, unless a sustainable basis for funding borrowing costs is identified and a compelling business case developed that demonstrates best value in progressing a particular scheme.

21.       Note that the detailed programme of schemes will be agreed ahead of implementation of the substitute budget (if necessary).

22.       Require a robust business case to be prepared (and taken to the Investment Panel for review) before committing expenditure for the use of:

·       all revenue ‘invest to save’ proposals, and

·       capital schemes.

Cabinet recommendations to Full County Council on treasury management and borrowing:

23.       Approve, with immediate effect, the Treasury Management Strategy for 2017/18, which includes:

·       the investment strategy for short term cash balances;

·       the borrowing strategy for funding the capital programme;

·       the treasury management policy (Appendix 8);

·       the prudential indicators (Appendix 9);

·       the schedule of delegation (Appendix 11);

·       the minimum revenue provision policy (Appendix 12).

The following decisions have been approved:

24.       Note that services will develop detailed budgets and savings ahead of approval by Cabinet on 28 March 2017 when the final MTFP 2017?20 will be presented.

25.       Approve the draft MTFP for the financial years 2017?20, which includes:

·       to approve the Total Schools Budget of £545.2m (paragraphs 66 to 71);

·       to approve overall cash limits for individual services for the proposed budget and the substitute budget.

26.       A) Agree to establish a Sustainability Review Board comprising of three cross party Members, the Strategic Director for Adult Social Care and Public Health, the Deputy Chief Executive and the Director of Finance.

B) Require this board to bring back an initial report to the Cabinet meeting on 28 March 2017 on progress towards identifying £30m permanent service reductions and up to a further £22m one-off reductions required to achieve a balanced budget in 2017/18.

Reason for decision:

Full County Council will meet on 7 February 2017 to agree a  budget and set the council tax precept for 2017/18. Cabinet’s role is to recommend  a budget to Full County Council. Council must also agree substitute calculations in the event that its proposed budget would result in a council tax increase above that set out in principles laid down by the Secretary of State. The published draft principles for 2017/2018indicate that the council tax increase proposed by Cabinet would exceed that set by Government and substitute calculations are therefore also put forward to Council.