Agenda item

Please refer to the draft budget report published and shared on 3 January 2023.

Mr P Oakford (Deputy Leader and Cabinet Member for Finance, Corporate and Traded Services) and Zena Cooke (Corporate Director of Finance) were in attendance for this item.

1.    Mr Oakford presented the Draft Ten Year Capital Programme, Revenue Budget 2023-24 and Medium Term Financial Plan 2023-26 to the committee. He acknowledged that the local government finance settlement from government had exceeded original expectations but did not significantly alleviate the Council’s budgetary pressures. He told members that until government resolved social care funding, the authority’s budget as a whole would be severely strained, with the impact felt by all services and directorates. Further explaining that the draft budget was the most challenging in recent years, Mr Oakford highlight the significant budgetary pressures caused by inflation. He confirmed that £40m savings would be required in the 2023/24 financial year. He recognised that achieving savings objectives in previous financial years had been a challenge and underscored that there was little margin for failure in the next year. The proposed 4.99% increase in Council Tax, including the social care levy, was drawn to the committee’s attention. He noted that the administration continued to lobby government for further funding and that the highest Council Tax increase was considered necessary for negotiations. Further details of proposed savings were shared, including the Community Asset Programme, which aimed to save the Council £6m annually, whilst also reducing building maintenance by £7m, he reminded members that the Programme was in the consultation phase. He concluded by explaining that overspend in the 2022/23 financial year would by covered by the risk reserve up to £25m and general reserve beyond that point.

2.    Following a series of questions from the committee, Ms Cooke explained the implications of a Section 114 notice and reassured the committee that such notice was not anticipated so long as the proposed budget, including its planned spending reductions and additional funding were achieved. She reminded members that the Council was legally required to set a balanced budget.

3.    Members commented that a breakdown of the anticipated impact of the proposed budgetary changes would enhance members’ consideration. An additional request to include a year-by-year comparison in future draft budgets was made. Mr Rayner added that further detail on the impact of budgetary changes was important for assisting members’ consultation with community organisations on draft budget proposals. He noted that he had struggled to explain what impact proposed changes to the funding of KCC’s subsidised bus passes would have on the cost of passes to residents, due to a lack of information in the report.

4.    Mr Baldock raised concerns at the differential between the Council Tax and adult social care levy uprate cap of 5% and inflation, in excess of 10%, noting that demand would further outstrip funding if inflation continued to outstrip KCC’s revenue raising abilities. He recognised that this was a national challenge.

5.    Mrs Hudson asked whether agreement with government on the Safety Value would be in place by Budget County Council on 9 February. Ms Cooke advised that an agreement in principle with DfE was expected for the end of January, with a final agreement expected in mid-February. She explained the legal statutory override currently in place.

RESOLVED to comment on the draft capital and revenue budgets relevant to the committee including responses to consultation.