Issue - meetings

RESOLVED:

That the following be approved:

1.               £21.3m use of reserves in 2018/19, reduced from £23.6m due to receipt of additional funding announced in the Final Settlement on 7 February 2018 (paragraph 16 of the submitted report).

2.               Changes to the capital programme as outlined in paragraphs 28 and 29 of the submitted report, including £5m increase in 2018/19 for highways as a result of recent severe weather, funded by use of capital receipts. This brought the three year capital programme to £322m, with £144m in 2018/19.

3.               A savings programme over the three years of MTFP 2018?21 to build the council’s financial resilience (paragraph 17 of the submitted report).

4.               The 2018/19 service strategies (Annex 1 of the submitted report).

5.               The detailed service revenue and capital budgets for the year 2018/19 and indicative budgets for the years 2019-21 including amendments resulting from the Final Local Government Financial Settlement and other Government funding changes announced since 7 February 2018 (Annex 1 of the submitted report).

6.               The council‘s proactive and systematic engagement in: responding to proposed changes in local government funding to ensure these changes do not further disadvantage Surrey and seeking appropriate recognition by the Government of the costs of delivering services in Surrey.

7.               Publication of the service revenue and capital budgets as the Medium Term Financial Plan 2018?21 (MTFP 2018?21).

8.               Decisions related to the Early Years single funding formula (paragraphs 50 and 51 of the submitted report):

·      the local authority retained £3.4m of the Early Years Dedicated Schools Grant to manage the sector, support providers and secure the supply of places;

·      the SEN Inclusion Fund to provide additional funding to providers for 3-4 year olds with special educational needs was set at £1.4m (£1.2m in 2017/18)

·      fund individual Early Years providers at rates which were commensurate with the levels of funding in the Early Years DSG:
- £4.60 / hour for three and four year olds (£4.51 in 2017/18);
- £5.88 / hour for two year olds (unchanged); and
- £2.77 / hour additional deprivation funding based on eligibility for the early years pupil premium on economic grounds.

That the following be noted:

9.               The Director of Finance’s letter to the Ministry for Housing, Communities and Local Government confirming the council will spend the Adult Social Care Precept entirely on adult social care functions (Annex 2 of the submitted report);

10.             Fees & charges approved under delegated powers (Annex 3 of the submitted report).

11.             Equality Impact Assessments of the savings proposals within directorate and service budgets (Annex 4 of the submitted report).

Reasons for decisions:

The council has a legal duty to prepare a balanced and sustainable budget and to deliver statutory services to residents.

The Medium Term Financial Plan 2018?21 (MTFP 2018?21) is a three year budget that reflects assumptions about the current local and national financial, economic and political environment. Setting a three year budget is a key element of the council’s multi-year approach to financial management and  ...  view the full decision text for item 55

The Leader of the Council introduced the report and set out the main changes and highlights of the report and the Medium Term Financial Plan (MTFP).  He explained that the Minster for Housing, Communities and Local Government (MHCLG) had published its final local government finance settlement on 7 February this year – the day after Surrey County Council set its overall budget for 2018/19. The modest good news was an additional £2.5m for the Adult Social Care Grant. Although welcome, this was small compared to the cost and demand pressures the service was facing. The Council would use this to fund the cost pressures in the Learning Disabilities market that emerged around the time of setting the budget.

The Leader also reported that the final estimate of the growth gain from the Business Rate retention pilot in 2018/19 was issued by the MHCLG with a minimal change to Surrey’s figures. An official launch event for the Pilot areas was planned for 26 March 2018.  The impact on this additional funding was to reduce the use of reserves to support the budget to £21.3m for 2018/19.  As quoted in the Council Budget Report, the Council needed to deliver £66m of savings in 2018/19. These had been assessed on the risk of their achievement using a Red Amber Green approach and were as follows; Red £13m, Amber £27m and Green £26m.

The Leader further explained that the Chief Executive and the Director of Finance were planning to carry out an in-depth review on the plans for the 2018/19 savings to ensure these were delivered in full.  In the following two years, the Council had already identified a further £67m of spending reductions.  However, despite this, the funding shortfall would still be £86m in 2019/20, rising to £94m the following year. Under the Leadership of the new Chief Executive, working with the Executive and Cabinet Team, the Council was developing plans to transform its services to achieve a sustainable financial plan over the next three years and assure longer-term financial sustainability in the context of uncertain future funding.

On the capital budget, the Cabinet was proposing to increase the spending on highways by £5m in 2018/19 as a consequence of the recent severe weather. This would increase the total capital programme to £322m over the next three years.

The capital budget presented in the MTFP also included some re-profiling of spending, especially in regards to the residential refurbishment and an update to the capital programme relating to Environment & Planning Strategic Economic Plan Schemes (Local Growth Deal) and schemes funded by developers or as part of the cross directorate CIL (Community Infrastructure Levy) schemes. In addition, the IT and Digital projects budget had increased to include the network refresh spend which would be funded from the equipment replacement reserve.

Finally, the Leader reported that an amended report and annex 1 (MTFP) had been published as a supplement to the agenda and he explained the minor amendments made to the MTFP.  The amended cover report  ...  view the full minutes text for item 55