Agenda item

Draft Ten Year Capital Programme, Revenue Budget 2022-23 and Medium Term Financial Plan 2022-25


1.    The Deputy Leader and Cabinet Member for Finance, Corporate and Traded Services, Mr Oakford, introduced the report published on 5 January 2022 and said the 2022-23 and medium-term budget proposals had been developed against the background of considerable uncertainty and volatility.  The capital programme had been enhanced to show a 10-year horizon covering 2022-32 which would ensure a more realistic capital programme with less slippage.  Mr Oakford said it was vital that additional borrowing was minimised to avoid unaffordable pressure on the revenue budget. Mr Oakford said the Council was required to set a balanced revenue budget for the forthcoming year (2022-23) which meant the net spending should equal the available funding raised from council tax precept, retained business rates growth and grant settlement from central government.  Mr Oakford said the Council was facing exceptional spending demands for the forthcoming year from a combination of the longer term impacts of the Covid-19 pandemic which had significantly changed demands and costs for key services leading to additional spending associated with latent demand, increasing complexity, and changes in social and working lives, as well as economic impact from rising inflation.


2.    Mr Jones highlighted the challenges the Growth, Environment and Transport (GET) directorate was facing including market inflation, scarcity and price rises on contracts.  The budget reflected the changes in demand and recognised the need for continued investment. Mr Jones highlighted some headline figures from a capital perspective, the majority of which derived from external funding including match funding from developer contributions.


3.    Mr Hill said community services had experienced a difficult year due to the Covid-19 pandemic and the exit from the European Union.  Country parks had suffered damage from increased traffic, the Libraries, Registrations and Archives division had worked hard to deal with increased demand and Community Wardens had proved to be invaluable supporting vulnerable residents.  Mr Hill thanked all staff for their sustained effort over the year.  Mr Hill was confident the community services budget would provide the resources needed to deliver community services to Kent residents. Mr Hill highlighted a small number of changes in the budget including the rolling programme for country parks, Public Rights of Way (PROW) and sports facilities. Mr Hill highlighted some savings including the first year savings from Digital Autopsy and a saving from Kent Sport. Finally, Mr Hill spoke about pressures including the removal of one-off savings introduced last year (2021 – 2022).


4.    Mr Murphy gave an overview of the economic development budget and highlighted a one-off cost allocated to economic development for a service re-design to accommodate the economic recovery plan which would come off the budget for 2022 – 2023.  Mr Murphy said there were not any new capital schemes for 2022-2023 but the No Use Empty Scheme, Kent and Medway Business Fund and the Broadband Voucher Scheme would continue. Mr Smith said a lot of the Economic Development Team’s work was self-financing (including the recycling of funds). 


5.    The Chair asked for a briefing note to be circulated on the specific projects where the recycling of loans had been used, how the system worked and prospects for the future.


6.    Mr Oakford, Mr Murphy and Mr Hill responded to comments and questions from the committee, including the following:


(a)  Asked about the new reserves that had been established Mr Oakford said the Strategic Reset Reserve was linked to the Strategic Plan.  This was a new reserve which had been formed to support the work of the Strategic Reset Programme and insecure funding such as the income from traded services had been included. Mr Oakford said the budget was in draft and awaiting feedback from the scrutiny process and the public consultation. Mr Oakford said financial sustainability was key and the Council’s debt to reserve ratio was high.  Mr Oakford recognised the need for the Council’s overspend to come back in line by the end of 2022 and money from the reserves would be required to balance the budget.  Mr Oakford highlighted the importance of risk reserves for financial security to cover any shortfall during next year’s budget process for 2023-24.


(b)  The Chair asked for assurance that reserve information would be included in the budget at the County Council meeting on 10 February and Mr Oakford said there would be more detail in the final budget.


(c)  Asked whether the budget for PROW (Public Rights of Way) was enough to provide improvements and cover the backlog of work Mr Hill said he was confident the budget would allow a continuation of work. Mr Hill reminded the committee that there were 4,000 miles of PROW.


(d)  Asked about highway maintenance funding Mr Jones said the Department for Transport funding had fallen by £9million which would have a negative effect on the services provided to clear potholes. Mr Oakford said the issue had been acknowledged at Cabinet and discussions would be had regarding allocation of funding. 


(e)  Asked about additional staff resource to maximise funding for Section 106 Developer Contributions Mr Murphy said the team structure, additional training and liaison with districts was being reviewed.


(f)    Asked about the £600,000 funding for Faversham Bridge Mr Jones said it related to design development and tendering costs including stakeholder management.


7.    It was RESOLVED that the draft capital and revenue budgets, including responses to consultation, be noted, and the draft be presented to Cabinet on 27 January 2022 and full County Council on 10 February 2022.

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