Issue - meetings

To consider the report of the Cabinet Member for Finance and Change detailing the 2024/25 Budget and Medium Term Financial Strategy.

Report of the Cabinet Member for Finance and Change detailing the 2024/25 Budget and Medium-Term Financial Strategy for 2024/25 to 2027/28. The report provided detail to inform Council in setting the council tax charge for 2024/25. A report setting out the Capital Strategy, Flexible Use of Capital Receipts Strategy, and details of the General Fund capital programme for

2023/24 to 2028/29 was considered elsewhere on this agenda. The council’s financial position is such that the budget setting process for 2024/25 had

been considerably more challenging than previous years, including during those under austerity and funding reductions. The council faces significant financial challenges to deliver a balanced budget. This included limited revenue reserves, ongoing financial pressures, especially in children’s services and adult social care, and the continuing impact of inflation and interest rates.

The 2023/24 budget was balanced by a reliance on revenue reserves (£20.6M). In addition, sizable new budget pressures and increases to existing pressures have emerged during 2023/24. A combination of limited remaining reserves and high pressures has led to an underlying structural budget deficit in-year that is projected to continue into future years.  It is against this backdrop that budget proposals for 2024/25 were presented. Despite

considerable progress during 2023/24 in identifying measures to reduce expenditure and identify savings, a shortfall remains between the predicted level of spend and the council’s funding available. A balanced budget for 2024/25 is only achieved with Exceptional Financial Support (EFS) from the government. This support would be in the form of a capitalisation direction, which would allow the council to use capital resources to meet revenue expenditure in 2024/25. Without this support the council would almost certainly have been facing a Section 114 notice.

The recommendations therein, were moved by Councillor Letts and seconded by Councillor Finn.

The Council agreed to suspend Council Procedure Rules 14.2, 14.5, 14.6, 14.7, 14.8, 14.9 and 16.2:-

(i)  to enable any amendments to be proposed, seconded and considered at the same time;

(ii)  to enable any amendment to be re-introduced later into the meeting; and

(iii)  to revise the time allowed for speakers as follows:-

Movers of motions - 20 minutes

Seconders - 10 minutes

Green Party/Independent Members – 5 minutes

Honorary Alderman - 5 minutes

Right of Reply (Executive only) – 10 minutes

RESOLVED:

(i)  That the revised Medium Term Financial Strategy (MTFS) for the period 2024/25 to 2027/28 as set out in Table 1 and Appendix 1 be approved.

(ii)  That the 2024/25 General Fund Revenue Budget as set out in Table 2 and Appendices 1 and 2 be approved.

(iii)  That an increase in the ‘core’ council tax of 2.99% and an increase in the Adult Social Care precept of 2.00%, allowable under general powers to increase council tax without a referendum be approved.

(iv)  That additional General Fund pressures totalling £42.03M in 2024/25, increasing to £51.21M in 2027/28, as detailed in paragraph 33 be approved.

(v)  That the new commitments totalling £0.86M in 2024/25, increasing to £4.89M in 2027/28, as detailed  ...  view the full minutes text for item 65

To consider the report of the Cabinet Member for Finance and Change detailing the 2024/25 Budget and Medium Term Financial Strategy.

DECISION MADE: (CAB 23/24 43661)

On consideration of the report of the Cabinet Member for Finance and Change, Cabinet approved the following:

GENERAL FUND REVENUE

(i)  Recommend to Council the Medium-Term Financial Strategy 2024/25 to 2027/28 as set out in table 1 and Appendix 1. 

(ii)  Recommend to Council the Revenue Budget for 2024/25 as set out in table 2 and Appendices 1 and 2.

(iii)  Recommend to Council the inclusion in the budget General Fund pressures totalling £42.03M in 2024/25, increasing to £51.21M in 2027/28, as detailed in paragraph 33.

(iv)  Recommend to Council the inclusion of new commitments totalling £0.86M in 2024/25, increasing to £4.89M in 2027/28, as detailed in paragraph 36.

(v)  Recommend to Council the inclusion of savings proposals totalling £22.68M in 2024/25 General Fund Revenue Budget, reducing to £20.94M in 2027/28, as detailed in paragraph 40.

(vi)  Note that the Government is minded to provide Exceptional Financial Support (EFS) to the Council. This will be in the form of capitalisation direction, to ensure the council can agree a balanced budget for 2024/25 has sufficient resources to pay for transformation and other work needed to ensure the council is on a sustainable financial footing in future, and meet other potential liabilities.

(vii)  Recommend to Council the establishment of a comprehensive

       Transformation Programme as detailed in paragraphs 59 to 63 and

       associated funding of up to £10.62M from a combination of capital     resources and Transformation Reserve. To further recommend to  delegate to the Chief Executive (after consultation with the Leader    of the Council) the drawdown of funding and the establishment of a    resource plan as required for the Transformation Programme.

(viii)  Recommend to Council the adoption of the Business Planning and Budget Framework set out at paragraph 64 and Appendix 6.

(ix)  Recommend to Council an increase in the ‘core’ council tax of 2.99% and an increase in the Adult Social Care precept of 2.00%, allowable under general powers to increase council tax without a referendum.

(x)  Recommend to Council that it sets the Band D Council Tax for Southampton City Council at £1,812.69 for 2024/25, a Net Budget Requirement of £239.24M and the Council Tax Requirement for 2024/25 at £121.43M as per Appendix 9. The Council Tax increase comprises a core increase of 2.99% and 2.00% specifically for Adult Social Care.

(xi)  Note the summary of changes to fees and charges set out in paragraph 89 and Appendix 12 and recommend Council to approve the increase in Careline charges set out in Appendix 12.

(xii)  Recommend to Council the endorsement of the Statement of the S151 Officer as set out in paragraphs 118 to 124 on the robustness of the budget and the adequacy of the council’s reserves.

Other Recommendations

(xiii)  Recommend to Council the content of the procurement pipeline 2024-29 contained at Appendix 7.

(xiv)  Recommend the delegation of authority to the Executive Director Corporate Services & S151 Officer and the Executive Director of Place (after consultation with the relevant Cabinet Member) everything that is  ...  view the full minutes text for item 48