No apologies for absence had been received.

There were no disclosures of interest save for confirmation that all members were paying Council Tax, but had no other interest.

The minutes of the meeting held on 21 November 2022 to be submitted and signed.

The minutes of the meeting held on 21 November 2022 were agreed and would be signed at a later date.

The committee received a report of the Head of Finance which set out the proposed revenue and capital budgets for 2023-2024.  This was dealt with in sections, listed as attachments in the agenda, namely:

·        Budget setting for 2023-2024

·        Income charging policy

·        Fees and charges

·        Capital strategy (including the Treasury Management policy and Prudential Indicators)

            The Head of Finance presented each section and took questions after each one had been heard by the committee and described the progressively increasing net expenditure budget across the Medium Term Financial Strategy (MTFS). 

The Head of Finance detailed the various funding changes.  There being no questions on this area, she moved on to the capital investment programme and its supporting strategy.  She advised the committee that the overall programme had reduced by £32 million, with around £21 million of that related to the Hart Homes joint venture. 

She went on to describe the key funding of the capital investment programme and dealt with members’ questions. 

The Head of Finance went on to explain the general fund and earmarked reserves forecast, stating that the general fund would remain at £2 million across the MTFS which was the risk-assessed level for general balances.  The economic impact reserve which was also used to manage potential budgetary pressures, would, at the end of the period, be at £929,000, giving a total closing balance of £2.9 million for unringfenced reserves. 

            The Chair thanked the Head of Finance for her report.  He noted that uncertainty, due to risks in relation to the current economic situation were detailed within the report.

            The Chair invited the committee to ask questions or comment on the report.

            The Head of Finance responded to members’ questions.  These included reference to the Public Works Loan Board, which was still considered to be the long term lender for councils; increased costs for the parking service; housing service costs and the impact of Covid-19 on demand; Capital Investment Programme and re-profiling.

            The Head of Finance went on to detail the key and local risk areas. 

            This section of the report concluded with a brief reference to the Chief Finance Officer’s statutory report, before the Head of Finance moved on to deal with member’s questions. 

            The Head of Finance responded to questions about:

·        References to land transfers in the report.

·        The length of time the reduction in the use of reserves could be sustained through spending over budget. 

            The Chair then asked the Head of Finance to address the Income and Charging Policy.  The Head of Finance explained that there had been very little change in the policy from the previous year, where the overarching strategy was for full cost recovery.  The Head of Finance explained that the majority of the increases were at a minimum level of 6%.  This was due to the staff pay rise being set at that level and staffing was the council’s main cost of delivering services. 

            The Head of Finance dealt with questions from members at this point.  The questions were:

·        If the service  ...  view the full minutes text for item 25.

The scrutiny committee received the report of the Head of Finance, stating that the report requested an update to the budget. 

            The Head of Finance advised the committee that there was now an overspend of £43,000 for utilities.  There were also additional costs in relation to reduced income from:

·        Building Control, £61,000 decrease due to reduced applications and lower demand for inspections.

·        Land charges, £50,000 from lower than expected searches.

·        Rental income.

            The Head of Finance advised that Fees and Charges would need to be an area of focus in the coming year. 

            The Head of Finance also forecast a variance of £150,000 due to the increased cost of borrowing. 

            In response to a question about the contraction in the economy affecting council tax and the budget, the Head of Finance reassured the committee that the budget planning had been very prudent.

            There was a question concerning the bulk pre-purchase of gas and electricity and a lower cost and whether this meant that the council had also purchased at a higher price and this would feed through in the future.  The Head of Finance explained that she was aware of this possibility and would need to check the position.  This would be updated no later than the next report in March. 

            RESOLVED –

            that the update to the Financial Monitoring report 2022-23 (Period 8) and both the revenue and capital forecasts for 2022-23 be noted.

            The Chair thanked all those present at the meeting, but asked for his special thanks to the Head of Finance to be noted.