Agenda item
Draft General Fund Budget and Medium Term Financial Strategy Update (Decision: 110544)
Minutes:
Councillor Hebb introduced the
report and stated that in May 2016, the Conservative minority
administration had inherited a £30million deficit forecast
over a three year period, but had managed to balance this budget
through entrepreneurial ideas, and not simply service cuts. He
stated that the investment approach had been started before the
Conservatives had taken power, and had been built on since then,
including during a time when there had been three party leadership.
He stated that Members continued to be involved in the investment
strategy, and highlighted that rainy day reserves had initially
increased by 40%, but had now been tripled. He stated that this was
partly due to the investment strategy, but also partly due to more
structured services, such as children’s centres and the
policy of ‘fewer buildings, better services’, which had
seen children’s centre uptake increase from 70% to 95%. He
stated that because of these policies, the Council had been able to
fund lots of different additional areas, such as increased
policing, increased use of technology, and the Clean It, Cut It,
Fill It strategy.
Councillor Hebb stated that because of COVID-19 the Council were
now entering a new world, with the majority of people working from
home, increased numbers of people in care homes, increased numbers
of benefits claimants, and another national lockdown. He stated
that because of the impact of the pandemic, the Council would be
deferring £19million of capital projects, and would have to
make other savings too. He stated that as individuals were affected
by COVID, the Council were also affected, such as through loss of
income because of temporary leisure centre closure and a reduction
in the payment of business rates. He stated that the investment
strategy remained resilient, as Thurrock had invested in solar
energy, which was both good for the environment and not affected by
the global pandemic. Councillor Hebb stated that although current
investments continued to do well, the investment strategy had now
been paused. He stated that due to COVID-19 pressures, there had
been reduced levels of new investment compared to what had been
anticipated, so Thurrock would reduce its borrowing forecast by
over £300million, and would take stock of future
infrastructure projects that had been planned.
Councillor Hebb stated that many peoples’ lives had been
changed by the pandemic, but individuals had been supported through
government schemes such as furlough, homelessness support and
business grants. Councillor Hebb stated that the government had
also supported Thurrock through the pandemic, by giving
£10million to close budget deficit gaps. He stated that this
government support would have to end eventually, both on an
individual level and a Council level, which would affect people in
numerous ways, such as through loss of income or loss of jobs. He
stated that this individual impact would have a knock-on effect for
the Council, as the Council would continue to see increased numbers
of people unable to pay business rates, or applying for local
council tax support. He stated that currently Thurrock had not seen
a large rise in the number of people applying for local council tax
support, but felt that this would increase dramatically in 2021/22,
due to the end of the furlough scheme and other COVID impacts. He
stated that government support received by Thurrock would not
continue indefinitely, and therefore only deferred the budget
deficit gap, and did not solve it, but Thurrock would continue to
support those most vulnerable residents.
Councillor Hebb stated that Thurrock Council would ask the same
questions that residents were currently asking such as, what
savings were available and how spend could be reduced. He stated
that because of the pandemic, service reviews would be accelerated
and the Council were also proposing a 3% adult social care precept
increase and a 1.99% council tax increase. He stated that this
increase would equate to roughly £1 per week for 70% of
residents, and £2 per week for people in higher council tax
bands. He explained that these increases needed to happen to ensure
that the Council could continue with vital services. Councillor
Hebb also stated that some reserves would be partly used to help
close the budget gap. He urged residents to seek support if they
needed it, and encouraged residents to reach out if they felt they
could not afford council bills. He stated that enforcement action
on those who had missed council payments would also be slower. He
summarised and stated that the Council would rise to the challenge
that COVID-19 had created, and although it would be difficult,
could be achieved if everybody worked together.
Councillor Halden thanked Councillor Hebb and the finance team for
their report, and stated that this was a budget being put together
during a global crisis, which had instigated the need for a council
tax rise. He felt proud that over half of the budgets agreed in
previous years under a Conservative administration had frozen or
not increased council tax by the maximum. He felt that this was an
unprecedented crisis and £1 per week would not impact the
majority of local residents. He stated that for those most
vulnerable residents who would be impacted by this rise, support
would be made available. He highlighted that in the 11 months since
the start of the pandemic, the number of people needing adult
social care places had increased by £11million, and the
majority of these people were extremely vulnerable. He added that
Thurrock’s adult social care market needed to remain
competitive with the private sector and other local authorities, to
retain the best care workers, as market pressures increased and
morale decreased.
Councillor Johnson also thanked the finance team and Councillor
Hebb for their report, and felt that it was easy to understand,
honest and trustworthy. The Leader summarised and stated that the
crisis needed to be managed, and although the Council were still
seeing investment returns, due to local headlines this had
decreased slightly. He stated that the rainy day fund would be used
to help tackle the financial impact of the pandemic, and felt
pleased that the Council had increased reserves over recent years,
which helped deal with the crisis currently being faced.
RESOLVED: That Cabinet:
1. Noted the proposed updates to the Medium Term Financial Strategy
and the remaining deficits in future years.
2. Noted the updated Medium Term Financial Strategy forms the basis
of the 2021/22 budget.
3. Supported the proposed council tax increase of 1.99%.
4. Supported a 3% adult social care precept increase.
5. Commented on the draft budget proposals within the report to
inform the consultation with Corporate Overview and Scrutiny
Committee, with the final budget proposals to be presented to
Cabinet on 10 February 2021.
Reason for decision: as outlined in the report.
This decision is subject to call-in.
Supporting documents: