Issue - meetings

To receive the 2024/25 Financial Monitoring Report.

The Cabinet Member: Finance, Governance & Customer Services presented the report of the Interim Director: Finance, People and IDT.

The Medium Term Financial Strategy (MTFS) 2024/25 to 2027/28 was approved at Full Council on 29 February 2024 and included the 2024/25 revenue budget and medium term capital programme.  Since this approval, the economic climate had continued to be challenging with cost pressures being experienced, particularly in relation to the provision of Adult Social Care.

The report set out the latest financial monitoring position for the year relating to the revenue budget, capital programme and income collection.  It provided the latest projections in relation to the projected outturn position, progress against the approved 2024/25 capital programme and gave a summary of collection information in relation to Council Tax Business Rates and Sales Ledger income.

Nationally, Councils continued to face extreme challenges with unprecedented pressures driven by high costs and high demand for services, particularly in relation to Adult Social Care, Children’s Safeguarding and School Travel Assistance.    The autumn budget had set out its medium term financial plan for local councils which included a one year spending review covering 2025/26 and a further spending review in late spring 2025 to cover the period 2026/27 and 2027/28.   The headline figures indicated a real terms increase in core local government spending of 3.2% in 2025/26 including at least £1.3 billion of new grant funding of which £600 million would be new grant funding to support social care.  Further details would be announced in the local government financial settlement in December 2024.  The government were committed to reforming the approach to local government funding considering up to date need and local revenue with a targeted approach to the 2025/26 financial settlement.  This would be followed by a multi-year settlement.

Inflation fell to 1.7% which was below the Bank of England’s 2% target which was an indication that price increases were steadying.  The Bank of England’s base rate reduced from 5.25% to 5.00% in August with further cuts predicted for later in the year, although it was still higher than anticipated when the Council’s budget was set.   Whilst the funding outlook for the medium term remained uncertain, the administration would continue to address the priorities that residents expressed were important to them - a thriving economy, creating well paid jobs, ensuring the borough was a great place to live and learn, preserving the environment and addressing the climate change crisis.  It was a key priority that the Council remained efficient but kept the lowest council tax in the Midlands, whilst making wise investments to support front line services and be the best it could for its local residents.

The projected year end was summarised in the report which set out the Council had a one-off contingency of £1.595m set aside for the pressures of adult social care.  Prior to application of remaining contingencies included in the revenue budget, the projected outturn position was currently expected to be over budget by £4.498m at year end, which was an  ...  view the full minutes text for item 21