Agenda and minutes

Mr N J D Chard, Cabinet Member for Finance, and Ms L McMullan, Director of Finance, will attend the meeting at 10.00 am to answer Members’ questions about the budget proposals. 

The five Policy Overview Committees will be meeting during the next week or so to consider the budget proposals relating to their service areas.  A summary of the comments from the five Policy Overview Committees and from this Committee will be reported to Cabinet at its meeting on 8 February.

(1)       A supplementary report was tabled at the 2 February meeting summarising the comments on the draft Medium Term Plan and Budget made at the following meetings:-

(a)       Communities Policy Overview Committee – 26 January 2007;

(b)       Environment and Regeneration Policy Overview Committee – 29 January 2007;

(c)        Corporate Policy Overview Committee – 30 January 2007;

(d)       Adult Services Policy Overview Committee – 1 February 2007.

(2)       A further supplementary report was tabled at the 7 February meeting summarising the comments on the draft Medium Term Plan and Budget made at the following meeting:-

(e)       Children, Families and Education Policy Overview Committee – 6 February 2007.

(3)       Mr N J D Chard, Cabinet Member for Finance; Ms L McMullan, Director of Finance; Mr B Smith, Group Manager, Finance; and Mr K Abbott, Director of Finance and Corporate Services, Children, Families and Education Directorate, attended both the 2 and 7 February meetings to answer Members’ questions on this item.

(4)       After an introductory statement by Mr Chard, the Committee questioned Mr Chard, Ms McMullan, Mr Smith and Mr Abbott about the following issues:-

(a)       Effect of being “Floor” Authority

In answer to questions from Mr Hart, Mr Parker, Mr Smyth and Dr Eddy, Mr Chard and Ms McMullan explained that “floors” were part of the Government’s grant distribution arrangements.  Without the “floor” (which was worth £1.9m to KCC) KCC would receive a worse grant increase.  Recent changes to the funding arrangements meant that floor authorities received no additional Government funding for the revenue effects of “supported borrowing”, and so the revenue costs had to be met by the Council Taxpayer. 

(b)       Reduction in Capital Programme

In answer to questions from Mr Smyth, Mrs Dean and Dr Eddy, Mr Chard explained that he was proposing that the capital programme should be reduced by £20m because of the additional revenue cost to the Council Taxpayers  This would be the first time that the Government’s offer of supported borrowing had not been taken up in full.  This was because of the recent change in funding arrangements. He said that one example of the capital projects which would not now go ahead was the redevelopment of Greenhithe Station.

In answer to questions from Mrs Newell, Mr Chard explained that the Greenhithe Station project had originally been included in the capital programme because it was expected that there would be additional revenue support to cover the costs of borrowing (although the County Council would obviously have preferred a capital grant).  Now that the revenue impact of borrowing basically fell to council taxpayers, the scheme had had to be reconsidered alongside other priorities.

In answer to a question from Mr Smyth, Mr Chard said he thought it unlikely that the decision not to take up the full allocation of supported borrowing would prejudice the County Council in the future, not least because a number of other “floor” authorities had also decided they could not afford to take up their full supported borrowing allocation.  He added that it  ...  view the full minutes text for item 53.