Agenda item

Developing a revenue budget for 2023/24 against a backdrop of high inflation

To consider a report by the Director for Digital, Sustainability and Resources, copy attached as item 10


Before the Committee was a report by the Director for Digital Sustainability and Resources, a copy of which was circulated to all members, a copy of which is attached to the signed copy of these minutes as item 10. The purpose of the report before was to propose a budget strategy for the development of the 2023/24 budgets with the added challenge this year of high inflation. When the 2022/23 budget was set, the war in Ukraine had yet to start and that continued to affect global economies with a prolonged impact on the energy markets and the consequential cost of living challenges which confront communities as well as the Authorities.


The Head of Financial Services introduced the report to the Committee. The Worthing Cabinet Member for Resources was present to answer questions.


A Member asked what percentage staffing accounted for in the overall Councils’ budget. Members were told that this was about £28m


A Member asked how confident the Financial Services Manager was that inflation would fall back to 2% after two years. The Financial Services Manager told the Committee that this forecast had been supplied by the Bank of England. Members were given assurance that the Councils’ financial plan was reviewed three times a year.


A Member asked the following question: Can you confirm if there is any realistic prospect of the councils facing a "£6m funding gap" as was stated in a recent press release from the Councils? The Cabinet Member informed the Committee that it was important to be honest about the scale of the challenge facing the Council. There was confidence that the organisation would use its creativity and resourcefulness to meet the challenge.


A Member asked the following question: In section 6.5 with reference to Platform 4, the report states that you are reviewing existing fee earning services and that “services which operate on a commercial basis will be encouraged to maximise profit margins”. This implies that some fees are going to be raised - are there any areas in which you would like to rule out Members were told that it was premature to rule anything out at this stage. However the strategy was focussed on profit margins rather than fee levels and so there may be some fees where either fixing or reducing the fee level would stimulate demand.


A Member asked the following question: The papers detail how the council’s investment scheme has supported income which in turn has kept vital services running. At the same time the papers report that the council’s borrowing position is under borrowed. These facts stand in stark contrast to claims made in a council press release issued on the 6th June in which Councillor Martin McCabe was quoted as saying "we'll tackle the council debt we've inherited" and other social media posts by Councillor McCabe including one on the 8th of June which stated that the Labour administration would "tackle the financial hangover from years of Tory debt-fuelled binge-spending". Do you agree with the factual statements in your budget strategy or the opinions of your colleague Councillor McCabe? Members were told that as at the 31st March 2022 our debt level was £130m whereas our long term assets were valued at £280m. The council has a robust MRP policy in place which will ensure that the debt is prudently repaid over the life of the assets acquired through borrowing. The Council provided for the repayment of  £1.6m debt last year and will provide £1.7m this year. Members were told that local property would be invested in instances where the investment could generate income.


A Member asked the following question: How do you see the budget challenges affect service provision? Members were told that it was premature to answer the question at the current time. The intention was to protect service provision as much as possible. There were different ways to provide services including ways to reduce costs which could help protect other services.


A Member asked the following question: The papers detail how the council’s strategic property investment scheme has provided significant income, which in turn has kept vital services running.  Locally as a land owner or through investment, this council is currently sitting on a number of key long term revenue generator sites that could provide a raft of income to the council. When will these sites come on-line and improve the budget provision? Members were told that the Council was working on a number of sites that would improve the Council’s financial position either through a rental stream to the Council as a landlord, through increased business rates or through increasing the Council tax base.


Resolved: that the Joint Overview and Scrutiny Committee note the report



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