Issue - meetings

To consider a report of the Borough Treasurer.

The purpose of the report is to update the Council’s 2019/20 to 2022/23 Medium Term Financial Plan (MTFP) forecasts and assumptions taking account of local and national changes including the Government’s 2018 Autumn Budget and the 2019/20 Provisional Local Government Finance Settlement announcements since the completion of the MTFP Summer Review.

Whilst the MTFP Summer Review identified areas where resources could be made available to support the MTFP, the risks and volatility of the assumptions and forecasts meant it was prudent not to adjust the Council’s savings requirement at that stage. As a result the Council’s forecast savings requirement remained unchanged from the position approved by the Council meeting on 22 February 2018.

This report needs to be read in conjunction with other reports elsewhere on this agenda including:

·         Council Tax and Business Rates Discounts Annual Review;

·         Stockport Billing Area – 2019/20 Council Tax Taxbase and Non Domestic Rates Forecast; and

·         MTFP Cabinet Response: Our Medium Term Strategy and Budget Choices 2019/20.

The Cabinet is recommended to:

·           Note the details of the report including the announcements made in the Government’s 2018 Autumn Budget;

·           Note the delay to the announcement of the 2019/20 Provisional Local Government Finance Settlement and the impact changes in the Council’s settlement funding will have on the revised MTFP;

·           Note, and comment upon as appropriate, the financial forecasts for 2019/20 to 2022/23, and the key issues to be addressed in formulating a response to the financial challenges facing the Council;

·           Note the budget reduction requirement for 2020/221 of £11.831m rising to £33.399m in 2022/23;

·           Note the unallocated one-off resources identified and consider the options for the use of this resource as detailed in the report; and

·           Take the final steps necessary to propose a balanced budget for 2019/20 to the Budget Council meeting on 21 February 2019.

Officer contact: Jonathan Davies, 0161 218 1025, jonathan.davies@stockport.gov.uk

The Leader of the Council and Cabinet Member for Policy, Finance & Devolution submitted a report (copies of which had been circulated) updating the Council’s 2019/20 to 2022/23 Medium Term Financial Plan (MTFP) forecasts and assumptions taking account of local and national changes since the completion of the MTFP Summer Review.

Whilst the MTFP Summer Review identified areas where resources could be made available to support the MTFP, the risks and volatility of the assumptions and forecasts meant it was prudent not to adjust the Council’s savings requirement at that stage. As a result the Council’s forecast savings requirement remained unchanged from the position approved by the Council meeting on 22 February 2018.

The Leader of the Council referred to the announcements made in the Government’s 2018 Autumn Budget and the delayed 2019/20 Provisional Local Government Finance Settlement announcements, the details of which were still being analysed but would feed into future reports to the Cabinet.

In particular, the Leader highlighted the following:-

·         The recent SEND Inspection Review and the need for further investment.

·         The implications of pay inflation and the National Living Wage on both staff and in the Council’s supply chain.

·         The need for further consideration of Care Homes Fees and the impact on providers.

·         Continued discussions on the GM Business Rates retention pooling arrangements.

·         The Government announcement on additional adult social care cost pressures funding was welcomed, but was insufficient for the demand.

·         Additional non-recurring resources for children’s services.

·         A projected revenue outturn position indicating surpluses in non-cash limit budgets but a deficit in cash-limit budgets, and the need for further consideration about how these could be used to address in-year pressure.

·         The Council’s response to a technical consultation by the Treasury on the Local Government Finance Settlement.

·         Disappointment that there had been no announcements on long term local government financing, nor the publication of the adult social care green paper.

RESOLVED – That in relation to the Medium Term Financial Plan (MTFP) Landscapes and Forecast for 2019/20 – 2022-23:-

·         the report, including the announcements made in the Government’s 2018 Autumn Budget be noted;

·         the delay to the announcement of the 2019/20 Provisional Local Government Finance Settlement and the impact changes in the Council’s settlement funding would have on the revised MTFP be noted;

·         the financial forecasts for 2019/20 to 2022/23, and the key issues to be addressed in formulating a response to the financial challenges facing the Council be noted;

·         the budget reduction requirement for 2020/2021 of £11.831m rising to £33.399m in 2022/23 be noted;

·         the unallocated one-off resources identified and the options for the use of this resource as detailed in the report be noted; and

·         authorisation be given to the final steps necessary to propose a balanced budget for 2019/20 to the Budget Council meeting on 21 February 2019.

To consider a report of the Borough Treasurer.

The purpose of the report is to update the Scrutiny Committee on the Council’s 2019/20 budget setting process and  Medium Term Financial Plan (MTFP) prior to the 2019/20 Provisional Local Government Finance Settlement (PLGFS) being announced by Government.

The report details further work which is being undertaken prior to presenting the MTFP Update report to the Cabinet meeting on 18 December 2018. This update will form part of a series of reports being presented to Cabinet that will inform the Council’s 2019/20 budget setting process and MTFP.

The Scrutiny Committee is asked to note the contents of this report and provide any feedback to be considered as part of the MTFP Update report to be presented to the Cabinet meeting on 18 December.

Officer contact: Jonathan Davies, 0161 218 1025, jonathan.davies@stockport.gov.uk

The Borough Treasurer submitted a report (copies of which had been circulated) updating the Scrutiny Committee on the Council’s 2019/20 budget setting process and  Medium Term Financial Plan (MTFP) prior to the 2019/20 Provisional Local Government Finance Settlement (PLGFS) being announced by Government, expected on Thursday, 6 December (Parliamentary time permitting).

The following comments were made/ issues raised:-

·         Further detail was sought on paragraph 3.16 in relation to risk/gain share from Stockport Together. In response it was clarified that the Council and partners expected benefits to accrue from Stockport Together, but that given the complexities of implementing new models of care it would be imprudent to include these benefits in the MTFP in the coming year.

·         Given that Stockport Together was not realising benefits as projected, it was asked when a decision would be taken to cease the programme. In response it was stated that it was anticipated that financial benefits would accrue in future years from the additional investments made, and that there had been in improvements in outcomes.

·         Clarification was sought on why the financial benefits of Business Rates retention were only realised in the following year. In response it was stated that given the volatility of the business rates tax base, and due to changes brought about by appeals to the Valuation Office, it was prudent to take this approach and to utilise the income for investment rather than to use for revenue expenditure. It was also commented that there was a no-detriment clause in the Pooling agreement from Government to prevent the Council loosing income from the volatility.

·         Further information was requested into the likely levels of precepts and levies for 2019/20. In response it was stated that the situation would become clearer once the Financial Settlement was announced, but there were suggestions that police precepts may be permitted to increase.

·         Concern was expressed about the impact on residents of the GM Mayoral precept. In response it was stated that the only resources available to the GMCA were through the precept or a levy on each Local Authority. The levy would give a greater degree of accountability for the Mayor and what was done with that resource.

RESOLVED – That the report be noted.