To receive any apologies for absence

None received

To receive any declarations of interest

None received

The deadline for public questions (directly relating to an item on the agenda) is 12noon on Thursday 8 October 2020.

For information contact Karen.shepherd@rbwm.gov.uk or 01628 796529

(The Council will set aside a period of 30 minutes to deal with public questions, which may be extended at the discretion of the Mayor in exceptional circumstances. The Member who provides the initial response will do so in writing. The written response will be published as a supplement to the agenda by 5pm one working day before the meeting. The questioner shall be allowed up to one minute to put a supplementary question at the meeting. The supplementary question must arise directly out of the reply provided and shall not have the effect of introducing any new subject matter. A Member responding to a supplementary question will have two minutes to respond).

a)    Andrew Hill of Boyn Hill ward asked the following question of Councillor Hilton, Lead Member for Finance and Ascot:

Table 4.18.2 of the approved February 2020/21 budget included a line for the "Estimated Year End Reserves" for the next five years. What are the equivalent five figures for Estimated Year End Reserves under the (para 5.1) base savings assumptions of this evening's paper, and why is it not explicitly shown in the appendices? 

Written response: The MTFS published with the Budget in Feb 2020 supported the budget for the financial year 2020/21 and gave an indication of the assumed financial outlook for the following 4 years.   When setting the budget the S151 officer has to report on the robustness of the estimates made for the purposes of the calculations and the adequacy of the proposed financial reserves, which leads to showing the figures for estimated year end reserves in the paper in February 2020.

The paper before Council tonight is effectively the start of the formal budget setting process for the financial year 2021/22 and consideration of the medium term financial outlook for the following four years.  It lays out the assumptions that we are making around levels of funding we are likely to receive from national government alongside assumptions we are making at this time around inflation factors, service levels and potential on-going impacts that the current global pandemic is having on our financial sustainability. 

The statement from the S151 is not required at this time, specifically because the council is not being asked to set a budget, but asked to agree the framework within which the council is working to manage its resources.

The main changes from the MTFS in February 2020 are the assumptions being revised for current circumstances.  As detailed in the report there are significant changes as a result of the impact of COVID-19 on Council finances, in-year impacts have been regularly reported via cabinet budget monitoring reports this year and will continue to be for the rest of the year.  There are also changes around some of the timing of revisions to how local government finances are calculated, again detailed in the report. Importantly, the revised MTFS indicates the Gap between Income and expenses that the budget will need to accommodate.

The 2020/21 budget is proving robust and the financial issues the Council now faces are as a result COVID 19 that has had a devastating effect on Councils up and down the Country. 

By way of a supplementary question, Mr Hill commented that the budget report in February had included the next five years of yearend general reserves were broadly £6m, £2m, then ‘blank’, ‘blank’, ‘blank’. The MTFS was described as ‘revised’ but Councillor Hilton had also said he did not need to present the revised year-end figures at this stage, referring to projections of shortfalls. He asked how Members could understand if the requested savings would result in balanced budgets unless they could see that in the context pf projected year-end  ...  view the full minutes text for item 39.

To consider the above report

Members considered a revised Medium Term Financial Strategy (MTFS).

Councillor Hilton introduced the report. He explained that the report set out the council’s MTFS for the next five years and contained the key economic assumptions that would form the basis of next year’s budget. The paper was not the council’s next budget but detailed the opportunities and constraints within which it would start the process of building the budget.

In normal times the 2020/21 MTFS would inform the 2021/22 budget setting process but such was the impact of COVID-19, which had increased council costs and reduced income from parking, leisure and commercial properties, that a revised MTFS had been drafted. However, this merely was a revision to that which Council had approved in February. It was an update which reflected the reality of the impact of COVID-19 and the near doubling of the gap between income and expenses that the budget would need to accommodate.

When setting the budget for 2020/21, councillors were made aware of the imperative of sound fiscal controls and strong governance arrangements. Members were well-acquainted with important measures introduced with CIPFA’s help. These included: increased transparency, improved quality of financial reporting, more rigorous scrutiny by establishing a separate Audit & Governance Committee, and an action plan to deliver CIPFA’s recommendations in full.  

Alongside this, the 2019/20 outturn report showed that the transformation programme was working, delivering excellent services and savings in-year of £1.7m.  If it were not for COVID-19 the far-reaching reforms and dedicated officer team had delivered a remarkable £2.9m positive variance by month 4 of the current budget. What no-one could have foreseen was the devastation that the global pandemic would cause; the loss of life had been tragic and the economic damage devastating. 

In preparing for the budget, the finance team had been working closely with MHCLG and the Leader of the Council had been in regular correspondence with MPs and Ministers to make them aware of the scale of the challenge the council faced.  

Preparations for the 2021/22 Budget were underway and the paper set out the assumptions around levels of funding likely to be received from national government, inflation factors, interest rates, capping levels and potential on-going impacts of COVID-19 on the council’s financial sustainability.  

Some national changes around local government funding had been delayed including the Comprehensive Spending Review (CSR). Officers had made their best judgements on the impact of the delays.  Later this year confirmation of the financial settlement from government was expected. This could lead to the revision of some of the assumptions that had been made in the paper.   

Against this background of uncertainty, the MTFS was presented to allow the council to best understand the financial parameters within which it needed to work to set a robust balanced budget for 2021/22. 

The strategy assumed that by the end of the financial year reserves will be above the minimum level.  In month 4 reserves were predicted to be £2.7m. However, it was anticipated that recovery of income  ...  view the full minutes text for item 40.