The Cabinet Member for Finance and Resources introduced a report which, following work in conjunction with external advisors, outlined a proposal to change the way that the Council calculated its Minimum Revenue Provision (MRP).

The proposal to change the method of calculation resulted in a re-profiling of MRP changes, rather than a permanent reduction in MRP charges, and flowed from the inclusion of long-term debtors and deferred charges in the calculation for the first time, as now permitted under statutory guidance.

On a motion by Councillor Janette Williamson, seconded by Councillor Tony Jones, it was -

Resolved - That the proposal to re-profile MRP charges resulting in a reduction of MRP charges by over £2m p.a. over the next ten years, recouped via higher charges in subsequent years, be endorsed and recommended to Council for approval.

Reasons for decision:

1.  Under statutory guidance issued by the Secretary of State under section 21(1A) of the Local Government Act 2003, a Local Authority might change the method(s) that it used for calculating part or all of its MRP at any time. 

2.  Where a Council changed the method used to calculate MRP, this should be explained in an Annual Minimum Revenue Provision Statement, submitted to full Council for approval at the start of the financial year, explaining why the change would better allow it to make prudent provision. 

3.  The proposal included in this paper, to effectively re-profile MRP charges, was only finalised in October 2019 due to the timing of external advice received on this matter and the need for discussion with Grant Thornton, the Council’s auditors during the 2018/19 audit process. As such, this report was in addition to the Annual Minimum Revenue Provision Statement presented at the start of the financial year.