Agenda item

RECOMMENDATION

 

1.    It is recommended that the Council approve the following:

 

(a)  The revised Revenue Budget for the financial year 2021/22 and the Revenue Budget for the financial year 2022/23 as set out in the General Fund Summary (Appendix 1) which includes:

 

            (i)     A Revenue Contribution to Capital of £2.0m, to support the provision of housing affordable to Island residents

           (ii)     The COVID Contingency estimated at £9.1m, to guard against continuing and legacy risks

 

(b)  Any variation arising from the Local Government Finance Settlement 2022/23 or any further savings made in 2021/22 arising at the year-end (after allowing for specific carry forward requests) be transferred to the Revenue Reserve for Capital, COVID Contingency, Transformation Reserve, and General Reserves with the level of each transfer to be determined by the S.151 Officer.

 

(c)  That the level of Council Tax be increased by 1.99% for general purposes in accordance with the referendum threshold[1] for 2022/23 announced by Government (as calculated in Appendix 2)

 

(d)  That the level of Council Tax be increased by a further 1.0% beyond the referendum threshold (as calculated in Appendix 2) to take advantage of the flexibility offered by Government to implement a "Social Care Precept"; and that in accordance with the conditions of that flexibility, the full amount of the associated sum generated of £905,600 is passported direct to Adult Social Care

 

(e)  That the amounts set out in Appendix 2 be now calculated by the Council for the financial year 2022/23 in accordance with Section 31 and Sections 34 to 36 of the Local Government Finance Act 1992

 

(f)    The S.151 Officer be given delegated authority to implement any variation to the overall level of Council Tax arising from the final notification of the Hampshire Police & Crime Commissioner, Hampshire & Isle of Wight Fire & Rescue Authority and Parish and Town Council precepts, and amend the calculations set out in Appendix 2 accordingly

 

(g)  The savings proposals for each Portfolio amounting, in total, to £3.0m for 2022/23 and continuing into future years as set out on the next page:

 

Portfolio	Controllable Budget	Savings Proposal
	£	£	%
Adult Social Care & Public Health*	52,585,029	1,730,900	3.3%
Children's Services, Education & Lifelong Skills*	26,518,026	375,900	1.4%
Community Protection, Digital Transformation, Housing Provision & Housing Needs	13,007,237	182,000	1.4%
Environment, Heritage & Waste Management	8,087,817	304,500	3.8%
Highways PFI, Transport & Infrastructure**	12,255,527	50,900	0.4%
Leader & Strategic Partnerships	806,763	0	0.0%
Planning & Community Engagement	2,061,733	11,000	0.5%
Regeneration, Business Development & Tourism	4,787,226	234,300	4.9%
Strategic Finance, Corporate Resources & Transformational Change	12,726,167	110,500	0.9%
Grand Total	132,835,525	3,000,000	2.3%

*Excludes the additional funding passported through to Adult Social Care of £3.7m (which if included would result in an overall increase of 3.7%) and the additional funding for Children's Services, Education & Skills of £2.3m (which if included would result in an overall increase of 7.3%)

 

** Excludes £19.4m of PFI grant funding, on a Gross expenditure basis the savings amounts to 0.2%

 

(h)  Directors be instructed to start planning how the Council will achieve the savings requirements of £6.0m for the 3 year period 2023/24 to 2025/26 and that this be incorporated into Service Business Plans

 

(i)    The minimum level of Revenue Balances as at 31 March 2023, predicated on the approval of £3.0m savings in 2022/23 and the retention of the COVID Contingency of £9.1m, be set at £7.0m to reflect the known and expected budget and financial risks to the Council

 

(j)    Members have regard for the "Statement of the Section 151 Officer in accordance with the Local Government Act 2003"

 

(k)  The Capital Programme 2021/22 to 2026/27 set out in Appendix 5 which includes all additions, deletions and amendments for slippage and re-phasing

 

(l)    The new Capital Investment Proposals ("New Starts") - 2022/23 set out in Appendix 4 be reflected within the recommended Capital Programme 2021/22 to 2026/27 and be funded from the available Capital Resources

 

(m)The allocation of Disabled Facilities Grants be made to the Better Care Fund, and reflected within the recommended Capital Programme 2021/22 to 2026/27

 

(n)  The S.151 Officer be given delegated authority to determine how each source of finance is used to fund the overall Capital Programme and to alter the overall mix of financing, as necessary, to maximise the flexibility of capital resources used and minimise the ongoing costs of borrowing to the Council

 

(o)  That the S.151 Officer in consultation with the Leader of the Council be given delegated authority to release capital resources held back for any contingent items that might arise, and also for any match funding requirements that may be required of the Council in order to secure additional external capital funding (e.g. bids for funding from Government or the Solent Local Enterprise Partnership).

 

(p)  The Capital Strategy 2022/23, including the Minimum Revenue Provision Statement contained therein (Appendix 6)

 

(q)  The Investment Strategy 2022/23 (Appendix 7)

 

2.    It is recommended that the Council note the following in respect of the Council's Budget: 

 

(a)  The Revenue Budget 2022/23 as set out in Appendix 1 has been prepared on the basis of a 2.99% increase in Council Tax, any reduction from the overall 2.99% Council Tax increase proposed will require additional savings of £905,600 for each 1% reduction in order for the Budget 2022/23 to be approved

 

(a)  The Revenue Forecasts for 2023/24 onwards as set out in the section entitled "Revenue Forecasts 2023/24 to 2025/26" and Appendix 1

 

(b)  The estimated Savings Requirement of £6.0m for the three year period 2023/24 to 2025/26, for financial and service planning purposes, be phased as follows:

 

Financial Year	In Year Savings Requirement £m	Cumulative Saving £m
2023/24	2.0	2.0
2024/25	2.0	4.0
2025/26	2.0	6.0

 

 

(c)  The Transformation Reserve held to fund the upfront costs associated with Spend to Save Schemes and Invest to Save Schemes holds a very modest uncommitted balance of £4.4m and will only be replenished from contributions from the Revenue Budget and an approval to the transfer of any further savings at year end

 

(d)  Should the Council elect to reduce the level of savings below £2.0m in 2023/24 (and £2.0m p.a. thereafter), the Council's financial risk will increase and therefore the minimum level of General Reserves held will also need to increase in order to maintain the Council's financial resilience

(e)  The Council Tax base for the financial year 2022/23 will be 53,879.9 [item T in the formula in Section 31 B(1) of the Local Government Finance Act 1992, as amended (the “Act”)].

 

(f)    The Council Tax element of the Collection Fund for 2021/22 is estimated to be in surplus by £582,900 which is shared between the Isle of Wight Council (85.7%) and the Police & Crime Commissioner (10.9%) and the Hampshire & Isle of Wight Fire & Rescue Authority (3.4%)

 

(g)  The Business Rate element of the Collection Fund for 2021/22 is estimated to be in deficit by £6,842,482

 

(h)  The Retained Business Rate income[2] for 2022/23 based on the estimated Business Rate element of the Collection Fund deficit as at March 2022, the Non Domestic Rates poundage for 2022/23 and estimated rateable values for 2022/23 has been set at £31,140,075.

 

(i)    The Equality Impact Assessment (attached at Appendix 8).

A 2022/23 Budget and Council Tax Setting report had been received from the Leader and Deputy Leader of the Council. Amendments had been submitted by Councillor Dore, Conservative group and Councillor Garratt, the amendments had been accepted by the Section 151 Officer as being legal and presented a balanced budget.

 

The Leader advised that both Councillor Dore and Councillor Garratt had withdrawn their alternative budget proposals. She also advised that £170,000 from the capital budget would be allocated to flooding in Binstead, it being confirmed by the Director of Finance this was achievable.

 

The Leader spoke on the budget proposals recommended by the Cabinet.

 

The proposer of the amendment spoke on their budget proposal.

 

The ungrouped councillors were invited to make comment on the budget proposals,

 

Other members of the council also made comment on the budget proposals.

 

The Leader, the proposer of the amendment and the other group leaders then summed up.

 

The Leader moved the recommendation by Cabinet which was duly seconded.

 

An amendment to the proposal attached as Amendment 2 (and forming part of these minutes) was moved by Councillor Robertson and duly seconded.

 

A named vote was taken the results were as follows:

 

For (19)

Cllrs Michael Beston, Paul Brading, Geoff Brodie, Vanessa Churchman, Warren Drew, Suzie Ellis, Steve Hastings, Stephen Hendry, Clare Mosdell, John Nicholson, Martin Oliver, Tig Outlaw, Gary Peace, Matthew Price, Chris Quirk, Ray Redrup, Joe Robertson, Peter Spink, Ian Ward

 

Against (19)

Cllrs David Adams, Debbie Andre, Jonathan Bacon, Claire Critchison, Ian Dore, Rodney Downer, Paul Fuller, Andrew Garratt, Chris Jarman, Julie Jones-Evans, Phil Jordan, Joe Lever, Michael Lilley, Karl Love, Karen Lucioni, John Medland, Lora Peacey-Wilcox, Richard Quigley, Ian Stephens

 

Abstain (1)

Cllr Daryll Pitcher

 

The vote was tied, in accordance with the Council’s Constitution the Chairman used his casting vote and voted for the amendment.

 

The Conservative amendment then became the substantive motion.

 

A named vote was taken the result of which was as follows:

 

For (34)

Cllrs Jonathan Bacon, Michael Beston, Paul Brading, Geoff Brodie, Vanessa Churchman, Claire Critchison, Warren Drew, Ian Dore, Rodney Downer, Suzie Ellis, Steve Hastings, Stephen Hendry, Chris Jarman, Julie Jones-Evans, Phil Jordan, Joe Lever, Michael Lilley, Karl Love, Karen Lucioni, John Medland, Clare Mosdell, John Nicholson, Martin Oliver, Tig Outlaw, Lora Peacey-Wilcox, Gary Peace, Matthew Price, Richard Quigley, Chris Quirk, Ray Redrup, Joe Robertson, Peter Spink, Ian Stephens, Ian Ward.

 

Against (5)

Cllrs David Adams, Debbie Andre, Paul Fuller, Andrew Garratt, Daryll Pitcher

 

RESOLVED:

 

1.    THAT the Council approve the following:

 

(a)  The revised Revenue Budget for the financial year 2021/22 and the Revenue Budget for the financial year 2022/23 as set out in the General Fund Summary (Appendix 1 amended) which included:

 

            (i)     A Revenue Contribution to Capital of £2.0m, to support the provision of housing affordable to Island residents

           (ii)     The COVID Contingency estimated at £9.1m, to guard against continuing and legacy risks

 

Appendix 1 (Amended) included the following changes listed in the tables below:

 

i)       AdditionalSavings -Reductions toBudget Estimates

 

IndicativePortfolio SavingsProposal	Impact onLevel ofService &Service Outcomes	2022/23	2023/24 & Future Years
		£	£
Strategic Finance,Corporate Resources& Transformational Change
New	Reduced RevenueContribution toCapital	(185,000)
	Total	(185,000)	0

 

ii) Additional Costs -Additions toBudget Estimates

 

Saving No.	Increasesto PortfolioBudgets	2022/23 £	2023/24 & FutureYears £
Strategic Finance,Corporate Resources& Transformational Change
48	Re-instate proposedstaffing reductions -Contact Centre	25,000
Planning& CommunityEngagement
New	Increase additional Planning staff (beyond the £100,000investment alreadyprovided for)	100,000
New	Independent review of Brownfield Sites to deliversignificant numbersof homes forIslanders ataffordable prices	60,000
Total		185,000	0

 

(b)  Any variation arising from the Local Government Finance Settlement 2022/23 or any further savings made in 2021/22 arising at the year-end (after allowing for specific carry forward requests) be transferred to the Revenue Reserve for Capital, COVID Contingency, Transformation Reserve, and General Reserves with the level of each transfer to be determined by the S.151 Officer.

 

(c)  That the level of Council Tax be increased by 1.99% for general purposes in accordance with the referendum threshold[1] for 2022/23 announced by Government (as calculated in Appendix 2)

 

(d)  That the level of Council Tax be increased by a further 1.0% beyond the referendum threshold (as calculated in Appendix 2) to take advantage of the flexibility offered by Government to implement a "Social Care Precept"; and that in accordance with the conditions of that flexibility, the full amount of the associated sum generated of £905,600 is passported direct to Adult Social Care

 

(e)  That the amounts set out in Appendix 2 be now calculated by the Council for the financial year 2022/23 in accordance with Section 31 and Sections 34 to 36 of the Local Government Finance Act 1992

 

(f)    The S.151 Officer be given delegated authority to implement any variation to the overall level of Council Tax arising from the final notification of the Hampshire Police & Crime Commissioner, Hampshire & Isle of Wight Fire & Rescue Authority and Parish and Town Council precepts, and amend the calculations set out in Appendix 2 accordingly

 

(g)  The savings proposals for each Portfolio amounting, in total, to  £2,975,000 for 2022/23 and continuing into future years as set out on the next page:

 

Portfolio	Controllable Budget	Savings Proposal
	£	£	%
Adult Social Care & Public Health*	52,585,029	1,730,900	3.3%
Children's Services, Education & Lifelong Skills*	26,518,026	375,900	1.4%
Community Protection, Digital Transformation, Housing Provision & Housing Needs	13,007,237	182,000	1.4%
Environment, Heritage & Waste Management	8,087,817	304,500	3.8%
Highways PFI, Transport & Infrastructure**	12,255,527	50,900	0.4%
Leader & Strategic Partnerships	806,763	0	0.0%
Planning & Community Engagement	2,061,733	11,000	0.5%
Regeneration, Business Development & Tourism	4,787,226	234,300	4.9%
Strategic Finance, Corporate Resources & Transformational Change	12,726,167	85,500	0.7%
Grand Total	132,835,525	2,975,000	2.2%

*Excludes the additional funding passported through to Adult Social Care of £3.7m (which if included would result in an overall increase of 3.7%) and the additional funding for Children's Services, Education & Skills of £2.3m (which if included would result in an overall increase of 7.3%)

 

** Excludes £19.4m of PFI grant funding, on a Gross expenditure basis the savings amounts to 0.2%

 

(h)  Directors be instructed to start planning how the Council will achieve the savings requirements of £6.0m for the 3 year period 2023/24 to 2025/26 and that this be incorporated into Service Business Plans

 

(i)    The minimum level of Revenue Balances as at 31 March 2023, predicated on the approval of £3.0m savings in 2022/23 and the retention of the COVID Contingency of £9.1m, be set at £7.0m to reflect the known and expected budget and financial risks to the Council

 

(j)    Members have regard for the "Statement of the Section 151 Officer in accordance with the Local Government Act 2003"

 

(k)  The Capital Programme 2021/22 to 2026/27 set out in Appendix 5 (amended) which includes all additions, deletions and amendments for slippage and re-phasing

 

(l)    The new Capital Investment Proposals ("New Starts") - 2022/23 set out in Appendix 4 be reflected within the recommended Capital Programme 2021/22 to 2026/27 and be funded from the available Capital Resources, be amended to reflect the following changes:

 

SchemeDescription - Reductions& Additions		Increase / (Decrease)in Corporate Resources	Total CorporateResources Allocated
		£	£
Reductions /Deletions toProposed CapitalSchemes:
28	Reduce Equity Capital for new HousingCompany	(1,185,000)	1,315,000
Additional CapitalScheme Proposals(New):
29	Housing - Increase the borrowing facility for theprovision of affordable homes subject toindividual programmeand projectbusiness cases	15,000,000	40,000,000
38	Rights of Way - Increase provision to restoreand improve access paths to Island beaches, torestore and improve footpaths, bridleways andrights of way	500,000	575,000
New	Provision for planting trees and restoringhedgerows on Council-owned land that is notsuitable forhousing	500,000	500,000
Total OverallChange		14,815,000

 

 

(m)The allocation of Disabled Facilities Grants be made to the Better Care Fund, and reflected within the recommended Capital Programme 2021/22 to 2026/27

 

(n)  The S.151 Officer be given delegated authority to determine how each source of finance is used to fund the overall Capital Programme and to alter the overall mix of financing, as necessary, to maximise the flexibility of capital resources used and minimise the ongoing costs of borrowing to the Council

 

(o)  That the S.151 Officer in consultation with the Leader of the Council be given delegated authority to release capital resources held back for any contingent items that might arise, and also for any match funding requirements that may be required of the Council in order to secure additional external capital funding (e.g. bids for funding from Government or the Solent Local Enterprise Partnership).

 

(p)  The Capital Strategy 2022/23, including the Minimum Revenue Provision Statement contained therein (Appendix 6)

 

(q)  The Investment Strategy 2022/23 (Appendix 7)

 

(r)   That delegated authority be given to the S. 151 Officer to make any necessary changes to either the Investment Strategy or the Capital Strategy in accordance with the proposed changes to the capital programme set out in the amendment.

 

2.    It is recommended that the Council note the following in respect of the Council's Budget: 

 

(a)  The Revenue Budget 2022/23 as set out in Appendix 1 has been prepared on the basis of a 2.99% increase in Council Tax, any reduction from the overall 2.99% Council Tax increase proposed will require additional savings of £905,600 for each 1% reduction in order for the Budget 2022/23 to be approved

 

(b)  The Revenue Forecasts for 2023/24 onwards as set out in the section entitled "Revenue Forecasts 2023/24 to 2025/26" and Appendix 1

 

(c)  The estimated Savings Requirement of £6.0m for the three year period 2023/24 to 2025/26, for financial and service planning purposes, be phased as follows:

 

Financial Year	In Year Savings Requirement £m	Cumulative Saving £m
2023/24	2.0	2.0
2024/25	2.0	4.0
2025/26	2.0	6.0

 

 

(d)  The Transformation Reserve held to fund the upfront costs associated with Spend to Save Schemes and Invest to Save Schemes holds a very modest uncommitted balance of £4.4m and will only be replenished from contributions from the Revenue Budget and an approval to the transfer of any further savings at year end

 

(e)  Should the Council elect to reduce the level of savings below £2.0m in 2023/24 (and £2.0m p.a. thereafter), the Council's financial risk will increase and therefore the minimum level of General Reserves held will also need to increase in order to maintain the Council's financial resilience

(f)    The Council Tax base for the financial year 2022/23 will be 53,879.9 [item T in the formula in Section 31 B(1) of the Local Government Finance Act 1992, as amended (the “Act”)].

 

(g)  The Council Tax element of the Collection Fund for 2021/22 is estimated to be in surplus by £582,900 which is shared between the Isle of Wight Council (85.7%) and the Police & Crime Commissioner (10.9%) and the Hampshire & Isle of Wight Fire & Rescue Authority (3.4%)

 

(h)  The Business Rate element of the Collection Fund for 2021/22 is estimated to be in deficit by £6,842,482

 

(i)    The Retained Business Rate income[2] for 2022/23 based on the estimated Business Rate element of the Collection Fund deficit as at March 2022, the Non Domestic Rates poundage for 2022/23 and estimated rateable values for 2022/23 has been set at £31,140,075.

 

(j)    The Equality Impact Assessment (attached at Appendix 8).

 

Adjournment

 

The Chairman called for an adjournment