2021/22 Budget Monitoring and 22/23 Budget Process
Decision Maker: Policy and Resources Committee
Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: No
An update on the savings for 2021/22 for the
Committee as agreed at Full Council on 1 March 2021.
A set of options for the Committee to consider for the 2022/23 budget process.
Shaer Halewood, Director of Resources, introduced a report on the 2021/22 budget monitoring and 2022/23 budget process.
The Committee was aware that the Ministry for Housing, Communities and Local Government (MHCLG) had provided a conditional offer of exceptional financial support (capitalisation directive) for 2021/22 of up to £10.7m. One of the conditions of that offer was that the Council would need to provide evidence from the assurance review of the authority’s financial position and its ability to meet any or all of the identified budget gap without any additional borrowing. Therefore, it was vitally important that the Council had robust processes in place to manage and monitor the in-year financial position, to ensure it was reporting a forecast balanced position to the end of the year and that the process for 2022/23 budget setting was underway early so that a budget could be agreed by full Council in March.
The report also outlined the processes and information to be provided for all Policy Committees to monitor their specific budgets and to ensure that the committee budgets remained within the relevant envelope and to take collective responsibility via the Policy and Resources Committee to ensure that the whole Council budget remained in balance at all times, by agreeing mitigating actions to bring the budget back in line, should a deficit be forecast.
The report reminded Members that one of the key documents required to enable the Council to receive approval for exceptional financial support was a balanced five-year medium term financial plan (MTFP). A summary of this was provided in the budget report to the Committee on 17 March 2021 (minute 87 refers). Each Committee, supported by officers, was accountable for identifying, developing and agreeing savings proposals during the summer to ensure a draft balanced budget could be considered by this Committee in October 2021, to enable budget consultation to start in a timely manner in November 2021.
To enable the officer budget proposals to be scrutinised by the Committee, it was recommended that a budget workshop be established to consider the content of the MTFP and make recommendations into the Committee on the viability of the proposals, the robustness of the pressures / growth items and to recommend any additional proposals that the Committee required officers to prepare.
The Chair expressed support for the approach but also the need for a reboot of the commercial strategy providing more income generation for the Council rather than a continual need to find savings and suggested an item on the work programme looking at the Council’s appetite for risk with a commercial strategy.
Responding to comments from Members, Shaer Halewood, acknowledged that no single committee had come forward to take on the zero based budgeting approach, and that to minimise the risk of achieving the savings identified all committees could take this on, although there was no assurance that this could happen. After some discussion on the subject, it was suggested that the Adult Social Care and Public Health Committee could be the pilot Committee to initially trial zero based budgeting with other committees potentially following on.
Responding to further comments, Shaer Halewood, stated that more detailed information for budget workshops with a breakdown of budget headings would be provided including on bad debt provision. Some of this information was not readily accessible due to the financial systems being based on directorates and not individual committees. Policy and Resources Committee would have oversight of all the Policy Committee proposals in October on which to take decisions as to what went out for consultation in November. Updates would be provided to this Committee before the October meeting.
With regard to the Capitalisation Directive, the MHCLG commissioned external review, due to start this month would conclude in the summer, and any recommendations would be taken forward for the Council’s budget setting process for next year. There would be a report on capital receipts with a forecast income of £4.6m from assets for 2022/23 and these would form part of the budget workshop for Members to look at which assets they would be happy to dispose of to form part of next year’s budget savings.
On a motion by the Chair, seconded by Councillor Yvonne Nolan, it was -
Resolved – That,
(1) Committee notes the content of the report and the current forecast position of savings for 2021/22 and the ongoing work being undertaken to mitigate any under achievement due to the National Employers’ pay award offer in paragraph 3.14 of the report;
(2) Committee notes that it may be possible to reduce the value of exceptional financial support in 2021/22 as a result of utilising some of the Contain Outbreak Management Funding for expenditure currently committed against the Tranche funding, but that this will be monitored during the year and an update provided to the Committee at the quarterly reporting;
(3) Committee convene a series of budget workshops to identify any alternative savings / income / reductions in pressures to ensure that the agreed budget savings for 2021/22 can be made as highlighted in paragraph 3.10 of the report;
(4) Committee agree for officers to work on the current proposals within this report at paragraph 3.25 for the 2022/23 budget, and tasks officers with developing them into full business cases, where appropriate, for inclusion in the 2022/23 budget proposals to Policy and Resources Committee at its October meeting for approval;
(5) Committee convene a series of budget workshops to identify any alternative savings / income / reductions in pressures for 2022/23 to ensure that a full suite of costed and deliverable proposals can be recommended to the Policy and Resources Committee at its October meeting for approval;
(6) Committee agrees to commence the Zero Based Budgeting project within the budget workshops, as highlighted in paragraph 3.19 of the report to contribute to the overall savings target of £170k in 2021/22, commencing with Adult Social Care and Public Health Committee undertaking the process, fully supported by officers to enable a framework to be developed for other Committees to follow.
Report author: Shaer Halewood
Publication date: 17/06/2021
Date of decision: 09/06/2021
Decided at meeting: 09/06/2021 - Policy and Resources Committee