Issue - meetings

Report of the Executive Director of Resources

The Cabinet considered a report of the Executive Director of Resources, which set out proposals for the Council’s final revenue and capital budget 2017/18.

The report followed on from the Pre-Budget Report approved by Cabinet on 29th November 2016, which had been subject to a period of public consultation. The proposals within the report now submitted formed the basis of the Council's final revenue and capital budget for 2017/18 incorporating the following details:

·  Gross budgeted spend of £703m (£11m and 2% higher than 2016/17).

·  Net budgeted spend of £232.5m (£0.9m lower than 2016/17) funded from Council Tax and Business Rates less a tariff payment of £0.7m due to Government.

·  A Council Tax Requirement of £118.5m (£7.7m and 7% higher than 2016/17), reflecting a City Council Tax increase of 4.9% detailed in the separate Council Tax Setting report on today’s agenda.

·  New service savings of £1.4m in 2017/18 rising to £10.4m in 2019/20.

·  A Capital Programme of £123.2m (£42.2m and 52% more than the latest estimated 2016/17 programme) including expenditure funded by Prudential Borrowing of £60.9m.

·  An updated Treasury Management Strategy.

It was noted that, at the time of producing the report, the final 2017/18 Local Government Finance Settlement had not yet been published. The proposals within the budget report had been made on the basis of the latest information regarding the likely details of the Settlement.  In particular, this included the estimated impact of joining the ‘100% Business Rates Pilot’. The difference between these estimates and the details in the Final Settlement were likely to be insignificant and would be met by reserve contributions.

The Settlement was anticipated to incorporate continued reductions in core Government funding over the next 3 years with a planned reduction of £24m in Coventry’s funding assessment.  However, along with the other 6 West Midlands councils, Coventry was taking part in a 100% Business Rates Pilot scheme.  This would enable Coventry to retain 99% of Business Rates income including an element of growth against an historic baseline which would otherwise have been returned to the Government. This money is available for the Council to use within the budget proposals within this report and is in addition to the resource base assumed within the Pre-Budget Report.

In previous years the City Council has had the flexibility to increase Council Tax by up to 2% without holding a local referendum on the matter. In 2016/17 the Government allowed councils to increase this flexibility by a further 2%, up to a maximum of 4%, recognising the increasing pressure on Adult Social Care (ASC) services across the country. This was the basis on which the Pre-Budget position was reported.  The Government had subsequently announced a further extension of this ASC flexibility from 2% up to 3%.  The recommended budget assumed taking up this 3% flexibility in order to increase the resources available to fund ASC services in the city. As a result, the budget was being proposed on the basis of increasing Council Tax by 4.9%. This proposed increase would  ...  view the full minutes text for item 112