Issue - meetings

This report sets out Cabinet’s proposals for the Capital and Revenue Budget for 2024/25. In accordance with the Constitution, Council is required to approve the Capital and Revenue Budget, rent increases and Council Tax for 2024/25.

Background:

This report set out Cabinet’s proposals for the Capital and Revenue Budget for 2024/25. In accordance with the Constitution, Council was required to approve the Capital and Revenue Budget, rent increases and Council Tax for 2024/25. 

The Cabinet had considered initial budget proposals on 21 November 2023. On 5 February 2024 the Government had published a Local Government Finance Update via a written statement which had included the publication of the Final Local Government Finance Settlement 2024 to 2025.

The majority of allocations for Medway for 2024/25 had been confirmed as per those in the Provisional Settlement, so the extent to which the announcements impacted Medway’s Budget was minimal. This had been set out in an Addendum Report to the Proposed Budget presented to Cabinet on 13 February 2024.

In accordance with the budget and policy framework rules within the Constitution, the Overview and Scrutiny Committees had then considered the Cabinet’s proposals prior to Cabinet’s consideration of the draft budget on 13 February 2024.

It was noted that an overarching Diversity Impact Assessment, as set out in Appendix 11 to the report, summarised the results of Diversity Impact Assessments. These had been completed for each of the services affected by the proposed budget changes.

The Leader informed the Council that a Ministerial statement had been received that confirmed that Medway Council’s request for Exceptional Financial Support had been accepted in principle. This would enable the Council to borrow for revenue purposes and provide the flexibility to use existing grants to support Medway’s Improvement Programme. The Leader said that this support would enable the Council to move to a position of financial sustainability.

The Leader of the Council, Councillor Maple, supported by the Deputy Leader, Councillor Murray, proposed the recommendations set out in the report, subject to the following alteration:

Recommendations 1.1.1, 1.1.2 and 1.1.4 to 1.1.16 as set out on pages 213-215 of the Agenda.

Revised recommendation 1.1.3 as follows [change is shown as a bold underline]:

“Approve the additions to the capital programme set out in Table 12 of the report, including the addition of £22million funded through a combination of borrowing, capital receipts and revenue savings to deliver a programme of essential repairs and improvements to Gun Wharf.”

Note: Whilst the Council recommendation correctly references “…the addition of £20million funded through borrowing…” the detailed figures within the exempt appendix to the Cabinet report on 13 February 2024, reflected a £22million scheme netted off against £1.8million of capital receipts and £200,000 of revenue savings. It was this £22million of expenditure for which Council approval was sought.

Councillor Perfect, supported by Councillor Lawrence, proposed the following amendment:

Amendment to recommendation 1.1.2:

Add the following to the end of the recommendation:

“…subject to the following amendments to Appendices 2 – Regeneration, Culture and Environment Directorate pressures and savings and 3 – Business Support Department pressures and savings:

Remove:

·       Sports centre charges review: includes reduction in concessionary membership subsidies and free swimming (agreed saving of £218,000).

·       HIF impact -  ...  view the full minutes text for item 659

Background:

This report presented proposals for the capital and revenue budgets for 2024/25. It was noted that the Cabinet had considered initial budget proposals on 21 November 2023, which had identified a potential revenue shortfall of £35.798million in 2024/25.

It was noted that setting a balanced budget was particularly challenging in the context of national level funding reductions which had included a 91% reduction in the Council’s revenue support grant since 2010. Inflationary pressures were making the situation more difficult.

It was also noted that the Council had engaged CIPFA to undertake a resilience review. CIPFA had concluded that it would not be possible for the Council to set a balanced budget for 2024/25 without some form of Government intervention. Following this, Exceptional Financial Support had been requested in January 2024. The Council had been advised that its request to increase council tax above referendum limits had been rejected. It was waiting for confirmation of whether the second part of its request had been successful. This would enable the council to borrow for revenue purposes and the flexibility to use existing grants to support Medway’s Improvement Programme.

An addendum report had been provided which set out the impact of the Final Local Government Finance Settlement 2024/25, which had been announced on 5 February.

The budget proposals had been referred to all the Overview and Scrutiny Committees for consideration. The Overview and Scrutiny Committees’ views together with the recommendations of the Business Support Overview and Scrutiny Committee (1 February 2024) were set out for Cabinet at Appendix 1 to the report.

The report set out the requirements under equality legislation and it was noted that an overarching Diversity Impact Assessment would be included in the budget report to Full Council on 29 February 2024.