Agenda item

To consider a report which seeks feedback, as consultees, on the development of the Cheshire East Medium-Term Financial Strategy 2025/26 to 2028/29.

The Sub Committee considered the report which provided an update on the development of the Medium-Term Financial Strategy (MTFS) 2025-26 to 2028-29. Final approval of the 2025-26 budget would take place at Full Council on 26 February 2025, following a recommendation from the Corporate Policy Committee on 6 February 2025. Councillor Clowes read out a statement from Councillor C O’Leary, a member of the Sub Committee who was unable to attend the meeting, in relation to this item.

The committee noted the creation of a contingency budget line in the MTFS which had been created to cover inflation risks across the council including changes resulting from recent national budget announcements impacting local contractors. It was highlighted that this included commissioned services across the council and that this sum continued to be reviewed as new information was shared. As part of the budget report considered by the Corporate Policy Committee on 6 February this would set out, should any contingency budget be required in-year, how this would be appropriately vired. The risk budget line within the MTFS recognised the risk of unachievable budget savings or growth demands exceeding estimates. It was important, in light of the council’s low reserves, that the council had the ability to set aside monies should risks arise.

The committee debated the ‘Smoothing MTFS Reserve’ and felt that there was a lack of transparency and clarity around this. It was therefore proposed, seconded and subsequently carried unanimously that:

‘The Finance Sub Committee request that the Corporate Policy Committee consider the MTFS smoothing reserve to be disaggregated and returned to general reserves’.

It was noted that pay inflation continued to add financial pressure. The committee considered the estimated impact of the next pay award. An amendment was proposed, seconded and subsequently carried unanimously that:

‘The Finance Sub Committee request that the Corporate Policy Committee looks at the reserve situation and considers if they are adequate and have capacity to cover any above anticipated inflationary pay award in the region of a further 3% of what has been budgeted for’.

The committee considered and debated upon the benchmarking data set out in Appendix D relating to Council Tax. Concerns were raised by some committee members in relation to an increase above the current 5% and the pressures this would place upon local residents and Town and Parish Councils.

The recommendations, as amended, were proposed and seconded and following the debate a recorded vote on recommendation A was requested with the following results:

FOR

Councillors Lata Anderson, Dawn Clark, Alan Coiley and Brian Drake.

AGAISNT

Councillors David Brown, Janet Clowes, Stewart Gardiner and Reg Kain.

The Chair exercised her powers to give a casting vote. The motion was therefore declared carried with 5 votes for and 4 against.

RESOLVED (by majority):

That the Finance Sub Committee

A)   Recommend to the Corporate Policy Committee, for their meeting on 6 February 2025, all proposals within Appendix A, as related to the Committee’s responsibilities, for inclusion on the Council’s budget for 2025/26.

RESOLVED (unanimously):

That the Finance Sub Committee

B)   Note the capital growth items listed in Appendix B and the revenue implications noted in paragraph 23. These will be reviewed by the Capital Review Programme Board in January before a final list is brought to Corporate Policy committee in February.

C)   Note the contents of Appendix C – Provisional Local Government Settlement 2025/26 (Finance Sub Committee).

D)   Note the contents of Appendix D – Council Tax benchmarking and scenarios (Finance Sub Committee).

E)   Recommend that the Corporate Policy Committee consider the MTFS smoothing reserve to be disaggregated and returned to general reserves.

F)    Recommend that the Corporate Policy Committee looks at the reserve situation and considers if they are adequate and have capacity to cover any above anticipated inflationary pay award in the region of a further 3% of what has been budgeted for.

The meeting adjourned for a comfort break at 11.58 and reconvened at 12.10pm.