Agenda item

To approve the general fund and housing revenue account budget, capital programme and Council Tax for 2023/24

 

Council considered the Council Finances and Council tax Resolution for the period 2023/24.

 

The provisional Local Government Finance Settlement was announced on 19 December. The key points from the settlement were as follows:-

 

·      the Council Tax referendum limit would be 2.99% for local authorities, with social care authorities allowed an additional 2% Adult Social Care precept;

·      the inflation measure used to increase government funding within the Settlement Funding Amount would be CPI (10.1%) rather than RPI (12.6%);

·      Local Government Funding Reform – the Fair Funding Review and reset of Business Rates growth would not be implemented in the next two years;

·      the Social Care Grant had increased by £1.5bn to £3.85bn nationally, although £161m of the increase was due to the rolling-in of the Independent Living Fund;

·      no change to the Better Care Fund;

·      new and additional Adult Social Care Market Sustainability and Improvement Fund intended for local authorities to make tangible improvements to Adult Social Care;

·      new Adult Social Care Discharge Fund aimed at reducing delayed transfers of care;

·      Reduced Services Grant – from £822m to £464m nationally, due to the cancellation of the 1% National Insurance increase and to move funding to the Supporting Families Programme;

·      abolished the Lower Tier Services Grant.

 

The Council had benefited from additional Social Care grant funding from the settlement, particularly for Adult Social Care, but some of its non-ringfenced funding had been reduced.

 

Fees and Charges

 

An external review of Fees and Charges had been undertaken as part of the budget setting process to ensure that each charge was appropriate and achieving its objective. Where charges were intended to either break even or maximise income, analysis had been carried out to look at the total costs of providing the service to understand what the position was.

 

Reserves Position

 

The Council had two types of reserves:-

 

•                earmarked Reserves which were for specific future projects, commitments or risks, both revenue and capital;

 

•                unallocated balance, which was to ensure the Council can manage unexpected financial challenges.

 

The level of unallocated balances at the end of March 2022 was £14.7m following a restructuring exercise of the Council’s earmarked reserves. The previous level of unallocated balances was deemed to be at the lower end of prudent and lower than many of the Council’s nearest neighbours. This was anticipated to remain at the same level at the end of March 2022 and through 2023/24, although the Council was experiencing significant cost pressures during the current financial year.

 

Council Tax Proposals

 

The draft budget assumed a 2.99% increase in Council Tax, made up of 1.99% ‘core’ increase and 1% for Adult Social Care in line with previous Council Tax Referendum Limits.

 

The provisional settlement confirmed a referendum principle of 2.99% for core Council Tax and 2% for the Adult Social Care precept. This meant that the Council could raise Council Tax by a total of 4.99% in 2023/24.

 

Each 1% increase in Council Tax raised approximately £1.2m in

additional Council Tax income and ensured that the Council Tax base was maximised for future years. Due to the referendum principles that limited Council Tax increases every year, if the Council opted not to apply the maximum increase, the Council Tax base would be permanently reduced and the additional income would be forgone every year.

 

The majority of properties in Sandwell were in Council Tax Bands A and B, with 43% being in Band A and 33% Band B. A Band B property, as an example, currently pays £1,225.68 per year for the Council’s element of the Council Tax.

 

Housing Revenue Account

 

The Housing Revenue Account (HRA) was a ring-fenced account for the Council’s housing stock and was shown separately to the General Fund. Income came from rent and service charges and expenditure related to the management and maintenance of the stock.

 

Capital programme

 

The total Capital Programme for 2023/24 was recommended to be set at £186.5m, of which £77m is for the HRA. This was to be funded by a combination of grants, earmarked reserves, revenue contributions, Right to Buy receipts and borrowing.

 

The Programme had been reviewed by the Corporate Asset Management Board to ensure that projects still met corporate priorities and in some cases, projects had been removed from the programme and any funding reallocated.

 

The Deputy Leader and Cabinet Member for Finance and Resources wished to place on record his thanks to the finance team.

 

In accordance with the Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014, and Standing Order 14 (4), the amendment relating to Council Finances 2022-23 was put to a named vote as follows:-

 

For

Councillors Ahmed, Akpoteni, Allen, Ashman, Carmichael, Chidley, Crompton, Dhallu, Dhariwal, Fenton, Gavan, E A Giles, E M Giles, J Giles, L Giles, Hackett, Hartwell, Hinchliff, Hughes, Z Hussain,

O Jones, R Jones, S Jones, Kaur, Khatun, Lewis, Mayo, McVittie, Melia, Millard, Moore, Owen, Padda, Piper, Preece, Rahman, Randhawa, Rollins, Simms, Singh, Smith, Taylor, Uddin and Webb.

 

Against

Councillors Abrahams, Anandou, Dunn, Fisher, W Gill, Kalari and Williams.

 

Abstentions

None.

 

On being put to the vote, the motion was carried and it was

 

Resolved:-

 

(1)        that the expenditure level for 2023-24 and the resultant Council Tax be approved;

 

(2)        that the budget for 2023/24 be approved;

 

(3)        that the supporting information on the robustness of the budget process and adequacy of the Council’s reserves be noted;

 

 

(4)        that the Treasury Management & Investment Strategy together with prudential indicators outlined be approved;

 

(5)        that the Capital Programme 2022/23 to 2026/27 and the Capital Strategy be approved;

 

(6)        that the amount of 76,764.73 as its Council Tax base for the year 2023/2024 in accordance with Regulation 3 of the Local Authorities (Calculation of Council Tax Base) Regulations 1992 made under Section 33 (5) of the Local Government Finance Act 1992 be noted;

 

(7)        that the following amounts be calculated by the Council for the year 2023/2024 in accordance with Sections 31 to 36 of the Local Government Finance Act 1992: -

 

(a)    Being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2) (a) to (f) of the Act;		£1,296,420,058
(b)    Being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(3) (a) to (d) of the Act;		£1,169,411,461
(c)     Being the amount by which the aggregate at 9(a) above exceeds the aggregate at 9(b) above, calculated by the Council, in accordance with Section 31A(4) of the Act, as its Council Tax requirement for the year;		£127,008,597
(d)    Being the amount at 9(c) above, all divided by the amount at 8 above, calculated by the Council in accordance with Section 31B(1) of the Act, as the basic amount of its Council Tax for the year;				£1,654.52

 

 

 

 

 (e)      Valuation Bands £:-

A         1,103.01

B         1,286.85

C         1,470.68

D         1,654.52

E         2,022.19

F         2,389.86

G         2,757.53

H         3,309.04

 

Being the amounts given by multiplying the amount at 9(d) above by the number which, in the proportion set out in Section 5(1) of the Act, is applicable to dwellings listed in a particular valuation band divided by the number which in that proportion is applicable to dwellings listed in valuation band D, calculated by the Council in accordance with Section 36(1) of the Act, as the amounts to be taken into account for the year in respect of categories of dwellings listed in different valuation bands;

 

(8)     that for the year 2023/2024 the major precepting authorities have stated the following amounts in precepts issued to the Council, in accordance with Section 40 of the Local Government Finance Act, 1992, for each of the categories of dwellings shown below be noted:-

 

Valuation Bands	West Midlands Fire and Rescue  Authority	Police & Crime Commissioner for the West Midlands
	£	£
A B C D E F G H	48.68 56.79 64.90 73.02 89.24 105.47 121.69 146.03	135.03 157.54 180.04 202.55 247.56 292.57 337.58 405.10

 

(9)     that, having calculated the aggregate in each case of the amounts at 9(e) and 10 above, the Council, in accordance with Section 30(2) of the Local Government Finance Act 1992, sets the following amounts as the amounts of Council Tax for the year 2023/2024 for each of the  categories of dwellings shown below:-

 

 

Valuation Band	£
A B C D E F G H	1,286.72 1,501.18 1,715.62 1,930.09 2,358.99 2,787.90 3,216.80 3,860.17

 

(10)   that the Chief Financial Officer to take any necessary action to collect revenues and disburse monies from the relevant accounts be authorised;

 

(11)   that the requirements of any relevant legislation, as a consequence of the approval of the Council's Finances 2023/2024 report, to consider reports with on the grounds that in the opinion of the Council the items are urgent be dispensed.