Issue - meetings

Further to Minute 78(ii)(b) (20 February 2023), the Cabinet Member for Finance, Growth and Core Services introduced a report on the Council’s draft Medium Term Financial Strategy (MTFS) and Reserves Policy for the period 2023/24 to 2027/28 in relation to General Fund expenditure.

The Cabinet Member explained that the draft MTFS had been developed against the backdrop of the uncertainty caused by the Government.  The cost-of-living crisis, inflation and delays to Fair Funding reforms and Business Rates retention arrangements were all impacting on the Council’s finances.  Although the Council retained a strong internal focus on its finances, the Cabinet Member commented that the increasing demand for services, the Council’s commitments in its Corporate Plan and updated assumptions that underpinned the financial planning meant that the updated MTFS now projected a cumulative funding gap of £28.3m over the five-year period, which represented a significant increase on the position reported in February 2023.  In order to bridge that gap, the Cabinet Member referred to both existing and new savings proposals, the implementation of transformation programmes and the need to continue to identify new investment opportunities to help secure long-term sustainability and deliver regeneration for the Borough. 

The revenue overspend for 2022/23 meant that the General Fund and Budget Support reserves totalled £18.274m which, although sufficient, meant that there was very little scope to cover unforeseen additional expenditure in the future.  With that in mind, the Cabinet Member referred to the proposed Reserves Policy 2023/24 to 2027/28 and the approach to budget setting for 2024/25 and expressed his view that a new Labour Government would introduce the Fair Funding reforms that were needed to properly finance the work of local authorities.

Cabinet resolved to:

(i)  Approve the Medium Term Financial Strategy 2023/24 to 2027/28 as set out at Appendix A to the report;

(ii)  Approve the Reserves Policy 2023/24 to 2027/28 as set out at Appendix C to the report; and

(iii)  Endorse the proposed approach to ensure the financial health of the Council over the medium term.