Agenda item - 2023/24 Strategic Financial Planning

This report provides an update on the Council’s 2022/23 budget and recommends a financial planning approach for 2023/24 to 2025/26.

Following consideration, the Committee resolved to agree:

(1) The proposed changes to 2022/23 budgets following the re-basing exercise, as set-out in section 5 of the report;

(2) The proposed contingency funding for the homelessness service in 2022/23, as set-out in paragraph 5.5 of the report;

(3) The proposed strategy for setting the 2023/24 budget in Section 6 of the report, including:

i.That the funding options identified in Table 5 should be progressed;

ii.That a service-specific savings target of £243k should be set for homelessness;

iii.That Directors and Heads of Service should work to produce specific income generation and savings options to meet the remaining budget deficit of £1.704m.

(4) That owing to the Council’s projected budget deficit, any additional new growth items supported by Policy Committees will need to be fully funded from existing budgets.

(5) The budget setting timetable at Appendix 2 to the report.

Recommendations 1, 2,and 5 above were agreed unanimously.

Recommendations 3 i, 3 iii and 4 were agreed with 8 votes for, 1 abstention and the Chair not voting.

Recommendation 3 ii was agreed by the Chair’s casting vote following 2 votes for, 2 votes against and 5 abstentions.

The Committee received a report providing an update on the Council’s 2022/23 budget and recommending a financial planning approach for 2023/24 to 2025/26.

The following matters were considered:

a) Homelessness service. The Committee noted that the report proposed £243,000 savings from homelessness services for 2023/24, based on the scenario of 58 households in paid overnight accommodation. It was also noted that a number of initiatives were being introduced by the Community and Wellbeing Committee to reduce the cost of homelessness and temporary housing. A Member expressed the view that the proposed savings might not be achievable and requested that the target for housing be kept under review. The Committee noted that the Minutes would record that the budget target for housing and homelessness would be kept under review and would be reviewed prior to the agreement of the 2023/24 budget.

b) Re-basing exercise. Following a question from a Member, the Head of Finance informed the Committee that the re-basing exercise had been identified in the Budget report agreed by Council in February 2022. The Head of Finance expressed the opinion that the re-basing exercise was in response to the once-in-a-generation event of the Covid-19 pandemic, and that he did not anticipate it being repeated in future years unless there was a further adverse event of similar scale.

c) Inflation. In response to a question from a Member, the Head of Finance informed the Committee that the current assumptions for inflation were that the existing pay deal for staff, with a cap of 3%, would be honoured in 2023/24. The assumption for energy was that costs would double under a neutral scenario. The Committee noted that Officers would keep these under review, given the uncertainty over inflation.

d) Government Covid-19 grant support. The Committee was informed that Officers had produced the report on the assumption that there would be no further Covid-19 grant support from government in the current year.

e) Ewell Court House. A Member requested further information regarding the budgeted £10,000 saving at Ewell Court House. It was noted that officers would circulate this information following the meeting.