Agenda and minutes

To receive declarations of any Disclosable Pecuniary Interests or other registrable or non-registrable interests from Members in respect of any item to be considered at the meeting.

No declarations of interest were made by councillors regarding items on the agenda for the meeting.

The Group is asked to confirm as a true record the Minutes of the Meeting of the Group held on 31 January 2025 (attached) and to authorise the Chair to sign them.

The minutes of the Financial Policy Panel meeting held on 31 January 2025 were agreed as a true record to be signed by the Chair.

This report provides guidance on setting the Council’s budget for 2026/27 and the following two years.

The Group received a report providing guidance on setting the Council’s budget for 2026/27 and the following two years.

Members discussed the following issues:

·                The possibility of borrowing to invest in capital projects to reduce the costs of maintenance of the Council’s assets which contribute to the forecasted revenue budget gap.

·                The possibility of selling some of the Council’s properties to raise the cash needed to maintain assets such as Bourne Hall and the Playhouse.

·                The reasons why the February MTFS budget deficit was significantly lower than the current figures, considering that the time between the two reports is only 4 months.

·                The question was asked as to what else can be done to improve the chances of success of achieving a sustainable balanced budget.

·                The possibility of the new local authority taking over the forecasted budget gap. Other councils in the area are reporting similar budget gaps, some councils have drafted only a year budget plan, it was noted that Epsom and Ewell Borough Council had produced a more comprehensive forecast and opted for a 3-year plan.

Following consideration of the above matters and the report’s contents, the Group moved to consider the report recommendations, which were agreed as follows:

To recommend to the Strategy and Resources Committee:

(1)       The amendment to the Medium Term Financial Strategy position and note the budget gap for the relevant years as set out in table 4.2;

(2)       The proposed Medium Term Financial Strategy is in line with council priorities, prudent and sets a framework for a strong financial control.

The Group also noted the following items:

(3)       The latest 2024/25 outturn position.

(4)       The latest reserves balance.

(5)       The budget reporting timetable in Appendix 2.

This report presents a review of reserves and recommends minimum reserve balances to ensure sound management of the Council’s finances.

The Group received a report presenting a review of reserves and recommending minimum reserve balances to ensure sound management of the Council’s finances.

Members discussed the following issues:

·                In February the decision was taken to set the minimum reserve balance at £1m, since then a benchmarking exercise has been undertaken and the results indicate that the council should adopt a more prudent strategy, 15% of the net revenue budget, £1.5m. 

·                The constitutional procedure that permits changing the minimum General Fund unallocated reserve level within 6 months of the previous Council decision on this matter. 

Note: Following the meeting, it has been confirmed that a motion may be moved to Full Council to rescind or alter a decision of Full Council if it is recommended by a committee, provided that it complies with the requirements of FCR 14.2 of Appendix 4 of the Constitution.

Following consideration of the report’s contents, the Group moved to consider the report recommendations, which were agreed as follows:

(1)       Consider and review whether the recommended General Fund unallocated reserve level of £1.5 million is appropriate for the sound management of the Council’s finances;

(2)       Review the methodologies and levels of other reserves in light of the latest MTFS and report back to FSAG.

The Group also agreed to request the Strategy & Resources Committee to recommend to Full Council:

(3)       Proposed changes to the General Fund unallocated reserve levels.