Agenda item

RESOLVED:

That Cabinet makes the following recommendations to Council on 8 February 2022.

Cabinet recommends that Council:

1. Approves the net revenue budget requirement be set at £1,042.0 million (net cost of services after service specific government grants) for 2022/23 (Annex B), subject to confirmation of the Final Local Government Financial Settlement.
2. Subject to finalisation of the tax base, approves the total Council Tax Funding Requirement be set at £831.0 million for 2022/23, subject to final confirmation of District and Borough tax base. This is based on a council tax increase of 4.99%, made up of an increase in the level of core council tax of 1.99% to cover core Council services, including 1% for mental health, and an increase of 3% in the precept proposed by Central Government to cover the growing cost of Adult Social Care (Annex E).
3. Notes that for the purpose of section 52ZB of the Local Government Finance Act 1992, the Council formally determines that the increase in core council tax is not such as to trigger a referendum (i.e., not greater than 2%).
4. Sets the Surrey County Council precept for Band D Council Tax at £1,626.39, which represents a 4.99% uplift. This is a rise of £1.48 a week from the 2021/22 precept of £1,549.08. This includes £185.48 for the Adult Social Care precept, which has increased by £46.47. A full list of bands is as follows:

5. Notes that the 4.99% increase in Council Tax will be deployed as follows:

·           0.99% increase to fund the increased cost of delivering services

·           3.00% increase to fund additional spend in adult and children’s social care

·           1.00% increase to fund additional investment in mental health.

Across this investment, the 3% increase in Adult Social Care Precept will be directed entirely to Adult Social Care.

6. Notes that underlying General Fund Balances are projected to remain at £28.0 million as of 1 April 2022.
7. Approves the Total Schools Budget of £575.2 million to meet the Council’s statutory requirement on schools funding (as set out in Section 9 of the 2022/23 Final Budget and Medium-Term Financial Strategy to 2026/27).
8. Approves the overall indicative Budget Envelopes for Executive Directorates and individual services for the 2022/23 budget (Annex B).
9. Approves the total £1,909.6 million proposed five-year Capital Programme (comprising £1,031.2m of budget and £878.4.9m pipeline) and approves the £212.1 million Capital Budget in 2022/23 (Annex C).
10. Approves the Capital and Investment Strategy (Sections 1 to 3), which provides an overview of how risks associated with capital expenditure, financing and treasury will be managed as well as how they contribute towards the delivery of services.
11. Approves the policy for making a prudent level of revenue provision for the repayment of debt (the Minimum Revenue Provision (MRP) Policy) (Annex G).
12. Agrees the Council’s refreshed Transformation Programme (as set out in section 3 of 2022/23 Final Budget Report and Medium-Term Financial Strategy to 2026/27)
13. Note that the investment in Transformation required to deliver improved outcomes and financial benefits is built into the proposed Medium-Term Financial Strategy (as set out in section 3 of 2022/23 Final Budget Report and Medium-Term Financial Strategy to 2026/27.
14. That Cabinet approves the £15m transfer from the Budget Equalisation Reserve to the Transformation Reserve set out in paragraph 10.
15. That Cabinet notes that the Audit & Governance Committee has approved the Treasury Management Strategy and Prudential Indicators (Annex F – Section 4) which set a framework for the Council’s treasury function to manage risks, source borrowing and invest surplus cash on 24 January 2022.

Reason for decision:

Council will meet on 8 February 2022 to agree a budget and to set the Council Tax Precept for 2022/23. Cabinet is required to recommend a budget to Council for consideration at this meeting. The budget directs available resources to support the achievement of the Council’s ambitions and priorities in the 2030 Vision and the Refreshed Organisation Strategy.

The budget will also support the delivery of the continuing transformational changes that are required to ensure that the Council can improve priority outcomes for residents, while managing growing demand for services and ensuring future financial sustainability.

The Leader introduced the report and thanked the Select Committees and their Chairmen for their work and collaborative approach. He emphasised that setting the budget was not a political issue, but the role of the Council to spend residents’ money effectively. He thanked the Deputy Leader and Cabinet Member for Finance and Resources,the Deputy Chief Executive and Executive Director of Resources, the Strategic Finance Business Partner, the Director of Finance Insights and Performance, and the Director of Corporate Finance and Commercial for their advice and preparation of a robust budget. He noted that the Council was moving into a recovery phase following the past two years of the Covid-19 pandemic. He highlighted the inequalities in the county that must be addressed, and that the Council had held true to its guiding principle in the Community Vision for Surrey in 2030 that “no one is left behind”. He highlighted the Council’s responsibility over the delivery of a wide range of strategic functions and services for 1.2 million residents, notably ASC and Children’s Service where combined £1.5 million was spent daily.

The Leader further noted that the Council had worked hard over the past three years to stabilise its finances, the Transformation Programme had delivered £240 million in savings, with a further £75 million to be saved over the next few years. The Council would continue to deliver efficiencies whilst improving services for residents, would continue to lobby the Government over funding, and would continue to work in partnership towards sustainability and thriving and empowered communities. Key areas of focus included building stronger local economies through skills and jobs, increasing the local provision of services and community support, looking after vulnerable residents through modernised social care provision, tackling climate change through technology and renewable energy, prevention and early intervention for children and adults, and addressing the rise in mental health support. That every penny of residents’ money from Council Tax would be invested in residents, the Council recognised the pressures faced by many and he highlighted the financial support information available on the Council’s website. He looked forward to the endorsement of the budget at the Council’s Budget meeting, it was essential for the Council to get on with the delivery of the ambitious five-year plan.

The Cabinet Member for Education and Learning highlighted the £125 million Special Educational Needs and Disability (SEND) Capital Programme as outlined in item 14.  

The Cabinet Member for Environment highlighted the £64 million identified for the Greener Futures programme as part of the longer-term £273 million allocation, the funding for the River Thames Scheme, ultra-low emissions bus scheme and Your Fund Surrey.

The Cabinet Member for Children and Families highlighted the Council’s provision of social care including supporting 1,000 Looked After Children, the continued delivery of the improvement plan to address the inadequate rating by Ofsted in 2018, the pressures of the pandemic such as the increase in Child Protection Plans, the increase in unaccompanied child refugees and asylum seekers, the increase in the children’s social care budget to £224 million for next year, the family safeguarding model and no wrong door model, the investment in residential children’s homes and provision of more in-house places for Looked After Children, the increase in foster carers needed and the recruitment and retention programme for staff.

The Cabinet Member for Property and Waste highlighted that £28 million was being invested on the Council’s corporate assets, rationalising the estate and creating fit for purpose community hubs, expanding, building and maintaining schools, providing additional SEND places, the total £139 million spend on those projects over the next five years, £80 million spending on building affordable accommodation.

The Cabinet Member for Community Protection highlighted the purchase of advanced technology such as seven new fire appliances with a further nine to follow and the purchase of new breathing apparatus equipment; working in partnership with staff to deliver the best equipment to keep Surrey safe.

The Cabinet Member for Adults and Health highlighted the various transformation programmes in ASC which were expected to deliver £41.8 million in efficiencies between 2022 to 2027, the Accommodation with Care and Support programme which would help deliver substantial efficiencies and provide an opportunity for some of Surrey’s most vulnerable residents to have their own home to learn new skills.

The Cabinet Member for Transport and Infrastructure highlighted that roads remained a priority for residents and following the past few years of increased investments complaints were reducing, the largest part of the capital programme was highways and infrastructure of just under £1 billion, the increased amount of £125 million into Surrey’s roads the next financial year for local highway schemes, the low emission hydrogen and electric buses to be in place shortly, the River Thames Scheme funding and the Housing infrastructure Fund bids.

The Cabinet Member for Communities highlighted that following Covid-19 revenue had started to increase through registrations, weddings and libraries for example, the fantastic staff who delivered services in a constrained budget envelope, the Libraries Transformation programme which was back online with £34 million in the capital budget, Your Fund Surrey whereby money out of the £100 million was borrowed as needed and noted a £500,000 investment in a community shop development in Normandy, the investment in new technology to support Customer Services.

The Deputy Leader and Cabinet Member for Finance and Resources highlighted that transformation was a key part of the Council’s agenda of continuous improvement, with forecasted achievements of £81 million of ongoing transformation related efficiencies by the end of 2021/22 and £55 million of cost containment with the benefits and the delivery of the efficiencies monitored throughout the year through the Transformation Assurance Board and other governance arrangements, the additional £20 million of efficiencies for 2022/23 and a further £32 million through to 2026/27, the Council was developing a twin-track approach to future transformation through the planning and delivery of two budget setting processes simultaneously towards a more collaborative approach between directorates, the delivery phase of the Transformation Programme through business cases and monitoring.

The Leader highlighted several of the recommendations. He proposed an amendment to Annex 1 - 2022/23 Final Budget and Medium-Term Financial Strategy to 2026/27, paragraph 6.36, pages 94/95, to add the following at the end of the paragraph (with additional words in bold/underlined and deletions crossed through):

“The Capital Pipeline includes £3m of additional road safety capital funding that will be drawn down and approved by Capital Programme Panel for schemes individually less than £1m in value." 

The Leader noted that it clarified where the road safety money was being spent on; the Cabinet agreed the above addition.

RESOLVED:

That Cabinet makes the following recommendations to Council on 8 February 2022.

Cabinet recommends that Council:

1.    Approves the net revenue budget requirement be set at £1,042.0 million (net cost of services after service specific government grants) for 2022/23 (Annex B), subject to confirmation of the Final Local Government Financial Settlement.

2.    Subject to finalisation of the tax base, approves the total Council Tax Funding Requirement be set at £831.0 million for 2022/23, subject to final confirmation of District and Borough tax base. This is based on a council tax increase of 4.99%, made up of an increase in the level of core council tax of 1.99% to cover core Council services, including 1% for mental health, and an increase of 3% in the precept proposed by Central Government to cover the growing cost of Adult Social Care (Annex E).

3.    Notes that for the purpose of section 52ZB of the Local Government Finance Act 1992, the Council formally determines that the increase in core council tax is not such as to trigger a referendum (i.e., not greater than 2%).

4.    Sets the Surrey County Council precept for Band D Council Tax at £1,626.39, which represents a 4.99% uplift. This is a rise of £1.48 a week from the 2021/22 precept of £1,549.08. This includes £185.48 for the Adult Social Care precept, which has increased by £46.47. A full list of bands is as follows:

5.    Notes that the 4.99% increase in Council Tax will be deployed as follows:

·      0.99% increase to fund the increased cost of delivering services

·      3.00% increase to fund additional spend in adult and children’s social care

·      1.00% increase to fund additional investment in mental health.

Across this investment, the 3% increase in Adult Social Care Precept will be directed entirely to Adult Social Care.

6.      Notes that underlying General Fund Balances are projected to remain at £28.0 million as of 1 April 2022.

7.      Approves the Total Schools Budget of £575.2 million to meet the Council’s statutory requirement on schools funding (as set out in Section 9 of the 2022/23 Final Budget and Medium-Term Financial Strategy to 2026/27).

8.      Approves the overall indicative Budget Envelopes for Executive Directorates and individual services for the 2022/23 budget (Annex B).

9.      Approves the total £1,909.6 million proposed five-year Capital Programme (comprising £1,031.2m of budget and £878.4.9m pipeline) and approves the £212.1 million Capital Budget in 2022/23 (Annex C).

10.   Approves the Capital and Investment Strategy (Sections 1 to 3), which provides an overview of how risks associated with capital expenditure, financing and treasury will be managed as well as how they contribute towards the delivery of services.

11.   Approves the policy for making a prudent level of revenue provision for the repayment of debt (the Minimum Revenue Provision (MRP) Policy) (Annex G).

12.   Agrees the Council’s refreshed Transformation Programme (as set out in section 3 of 2022/23 Final Budget Report and Medium-Term Financial Strategy to 2026/27)

13.   Note that the investment in Transformation required to deliver improved outcomes and financial benefits is built into the proposed Medium-Term Financial Strategy (as set out in section 3 of 2022/23 Final Budget Report and Medium-Term Financial Strategy to 2026/27.

14.   That Cabinet approves the £15m transfer from the Budget Equalisation Reserve to the Transformation Reserve set out in paragraph 10.

15.   That Cabinet notes that the Audit & Governance Committee has approved the Treasury Management Strategy and Prudential Indicators (Annex F – Section 4) which set a framework for the Council’s treasury function to manage risks, source borrowing and invest surplus cash on 24 January 2022.

Reason for decision:

Council will meet on 8 February 2022 to agree a budget and to set the Council Tax Precept for 2022/23. Cabinet is required to recommend a budget to Council for consideration at this meeting. The budget directs available resources to support the achievement of the Council’s ambitions and priorities in the 2030 Vision and the Refreshed Organisation Strategy.

The budget will also support the delivery of the continuing transformational changes that are required to ensure that the Council can improve priority outcomes for residents, while managing growing demand for services and ensuring future financial sustainability.