Agenda item

To receive the Medium Term Financial Strategy 2024/25 – 2027/28.

The Cabinet Member: Finance, Customer Services & Governance

 presented the report of the Interim Director: Finance & Human Resources.

 

The report sought approval of the Council’s Medium-Term Financial Strategy (MTFS) for the four years 2024/25 – 2027/28 and contained details of the Capital Strategy; Medium-Term Capital Programme; Investment Strategy; Treasury Management Strategy and the Prudential Indicators.  This combined information formed the Council’s overall Medium-Term Financial Strategy and the budget framework for 2024/25.

 

Key points from the report were the 2% adult social care precept for next year meaning a 4.99% overall increase in Council Tax would be required.  This increase would support the most vulnerable members of the community and despite the increase council tax remained the lowest in the region.

 

A public consultation had taken place together with scrutiny by members of the Council’s cross-party Business and Finance Scrutiny Committee on the MTFS.   The report remained consistent with the strategy and set out a prudent financial management throughout an unprecedented and protracted period of sever financial constraint.

 

The report set out the proposed medium-term capital investment programme which totalled £420m and highlighted the financial benefits such as high-quality homes for rent and jobs for local people. 

 

The Council were currently below the national average in relation to financing costs and net revenue streams and this was expected to remain the same for the remainder of the financial year.  Borrowing was proportionate for the size of the authority with a 60% planned return on investment which helped to protect front line services. 

 

Cabinet Members commented on the difficult circumstances that the Council were facing along with the long-term degradation of services.  The Council would continue to invest so as to benefit the local community and work hard to find efficiencies and investment opportunities in order to provide services and for the local community to live well and be protected.

 

The Leader of the Liberal Democrat Group applauded the return on the investments and the creation of jobs and partnerships which brought in additional tax.  The focus had to be on the government funding local councils in order to prevent the issuing of s114 Notices. 

 

The Deputy Leader of the Conservative Group noted the report and welcomed the opportunity for debate at Full Council.

 

The Leader thanked the cross-party Scrutiny Committee who had unanimously agreed a robust budget.  It was regrettable that Council Tax would be increased, the first time in 2 years, but every penny of the increase would go to protecting adult social care and children’s safeguarding.  Careful financial management and efficiencies would be required to meet the increased cost and demand for services.

 

RECOMMENDED TO FULL COUNCIL that:

 

a)    the Medium-Term Financial Strategy (MTFS) for 2024/25 – 2027/28 and the budget framework for 2024/25 set out in this suite of reports;

 

b)   council tax increase of 4.99% for 2024/25 including the Government’s 2% Adult Social Care precept, which will be fully invested in the provision of social care services for the most vulnerable members of our community;

 

c)    the net investments of £5.9m into Adult Social Care in 2024/25;

 

d)   the net investment of £7.6m into Children’s Safeguarding in 2024/25;

 

e)    the budget savings listed in Appendix 10 totalling £17.567m in 2024/25;

 

f)     the continuation of work with partner organisations, including Town & Parish Councils and Voluntary Sector and Community Groups to seek to identify ways to mitigate the impact of some of the cuts to services that we can no longer afford to deliver and to note the availability of the Invest to Save/Capacity Fund which is available to support partnership working;

 

g)   the base budget in Appendix 8;

 

h)   the policy framework for Reserves and Balances and their planned use outlined in Appendix 6;

 

i)     the Risk Register at Appendix 14;

 

j)     the endorsement of the Council Tax Reduction Scheme a link to which is included within Appendix 16, for adoption by Full Council on 29 February 2024, ready for implementation on 1 April 2024;

 

k)    the continuation of the Council Tax Reduction Hardship Assistance Policy, also within Appendix 16;

 

l)     the revenue implications of the medium-term capital programme for the period 2024/25 – 2027/28 set out in the Capital Strategy and Programme reports also on this agenda;

 

m)  to grant delegated authority to the Director: Finance & Human Resources, after consultation with the Cabinet Member for Finance, Governance and Customer Service to action any virements required following the final allocation of the Dedicated Schools Grant and other Grants and following completion of NNDR1 and final estimates of Business Rates Income;

 

n)   to grant delegated authority to the Director: Adult Social Care after consultation with the Cabinet Member for Adult Social Care and Health Integration and Transformation, to enter into appropriate Section 256 and Section 75 Agreements under the NHS Act 2006 (as amended);

 

o)   the authorisation of Director: Policy & Governance to execute all necessary contract documentation including affixing of the common seal of the council as appropriate to enable the council to enter into appropriate Section 256 and Section 75 Agreements under the NHS Act 2006 (as amended);

 

p)   to grant delegated authority to the Director: Finance & Human Resources, in consultation with the Leader or relevant Cabinet Member to allocate funding from the £20m Capital investment fund referred to in paragraph 4.6 of the report;

 

q)   this suite of MTFS reports as the Council’s Efficiency Strategy for 2024/25, including the document at appendix 13, to enable new capital receipts to be used to fund the revenue costs of transformation and efficiency projects as assumed throughout these reports;

 

r)    to grant delegated authority to the Director: Finance & H.R. after consultation with the Cabinet Member for Finance, Governance & Customer Services to amend the use of the contingency in 2024/25 and to make any other associated adjustments to accommodate any difference in funding between that currently assumed and final grant allocations when received;

 

s)    delegation of authority to the Director: Finance & H.R. after consultation with the Cabinet Member for Finance, Governance & Customer Services to make changes to the Medium-Term Financial strategy with immediate effect to reflect all grants received from Government with authority to incur associated spend;

 

t)     the Pay Policy for 2024/25 included as Appendix 17;

 

u)   the application of a 100% council tax premium to second homes from 1 April 2025 provided that the necessary legislation is in place by that date and delegation of authority to the Director: Finance & H.R. to finalise the detailed policies required after consultation with the Cabinet Member for Finance, Governance & Customer Service, irrespective of when legislation comes into force; and

 

v)    the additional recommendations contained in other reports included in this suite of Medium-Term Financial Strategy reports included on this agenda.

 

Members are asked to note:

 

w)  the unprecedented financial pressures being faced by local authorities across the country and the high level of uncertainty relating to the medium-term financial outlook for Telford & Wrekin Council due to:

 

· The escalating costs of, and demand for, many Council services  

   but particularly Adult Social Care and safeguarding vulnerable  

   children;

 

· National and international economic pressures resulting in an  

  extremely challenging financial outlook for U.K. public services;

 

· The Government’s one-year final local government finance

   settlement not extending beyond the end of March 2025;

 

· The impact of the significant potential changes to the local  

   government finance system which have now been discussed by

   the Government for many years remain a major uncertainty. As

   does the potential impact of Adult Social Care funding reforms

   which have been delayed until October 2025.

 

x)    that this high level of uncertainty requires the Council to retain flexibility by limiting new ongoing investments to our highest priorities whilst identifying 4 significant ongoing additional budget savings to ensure a balanced budget for next year and over the medium-term.

 

y)    the initial projections for the potential budget gap included in this report through to 2027/28 and that these will continue to be updated as additional information becomes available and that work will commence to identify options for how the future gap can be met; and

 

z)    the CFO’s robustness statement in Appendix 15.