Decision details

Consideration was given to an update on the budget setting process for the Council for 2013/14 and to the progress made in the development of the Medium Term Financial Strategy for 2013/16.  A number of strategic decisions were included in the report that would support the overall balancing of the Council’s budget for 2013/14 and in the medium term. 

RESOLVED

1.    That the updated medium term financial analysis, informed by the Mid Year Review of Performance reported to Cabinet on 12 November 2012 as part of the first phase of review, be noted.

2.    That approval be given to the following strategic financial decisions that contribute to the Budget Setting process for 2013/2014, and to the Medium Term Financial Plan for 2013/2016, which will be subject to both internal and external consultation up to the final approved position at Council in February 2013 (detailed in Table 2 of the report):

-       Increase estimated Grant Funding based on the return of national contingencies in 2013/2014 of £3.7m (related to New Homes Bonus).

-       Reduce the Capital Financing element of ‘Central Adjustments’ by £2.8m based on the review and reductions of the Capital Programme (subject to Council decision on 13 December 2012).

-       Apply Capital Reserves to reduce existing borrowing costs by £2.4m in 2013/2014 and enable further reductions in future years.

-       Freeze Council Tax Band D levels for a third consecutive year, making the Council eligible for additional Freeze Grant funding of approximately £1.8m. Cheshire East Council Tax will again be £1,216.34 for a Band D property.

-       Increase Council Tax income by £3.3m based on the reduction in certain discounts and the revised tax base for 2013/2014 (subject to Council decision on 13 December 2012).

-       Apply the current annual contribution to General Reserves of £1.6m, associated with the impact of Business Planning proposals in the 2012/2015 Business Plan, to the Council’s base budget for 2013/2014 and future years.

-       Increase the contribution to reserves by £1.3m from 2013/2014 to 2015/2016 based on the pay back of the strategic investment of reserves of £3.9m in 2012/2013.

-       To commit to the investment of reserves, in excess of the risk assessed minimum level of reserves, in the Change Projects that will deliver the Council’s 3 Year Plan, particularly with regard to its local economic growth ambitions.

-       To approve the savings forecast from the first phase of the review of Change Projects (Appendix 7 of the report) as a contribution to balancing the 2013/2014 Budget and the 3 Year Medium Term Plan for 2013/2016, subject to appropriate consultation internally via Policy Development Groups and the Executive Monitoring Board governance arrangements and externally with the public, key stakeholders and via specific consultation mechanisms where required.   

3.    That the other relevant assumptions in the Council’s Medium Term Financial Plan, such as Government funding estimates, that will be subject to further updating during the second phase of review in the period leading up to the setting of the Council’s 2013/2014 Budget in February 2013 (Appendix 6 of the report) be noted.

4.    That approval be given to initiation of the consultation/engagement arrangements on the Change Projects in the lead up to the setting of the Council’s 2013/2014 Budget in February 2013, internally via Policy Development Groups and the Executive Monitoring Board governance and externally with the public and key stakeholders.