Agenda item

Medium-Term Financial Strategy Update 2024 / 25 to 2026 / 27

To consider the report of the Interim Chief Finance Officer (copy enclosed).

Minutes:

The Committee considered the report of the Interim Chief Finance Officer presenting the revised Medium-Term Financial Strategy (MTFS) Update for 2024 / 25 to 2026 / 27.

 

Councillor M F L Durham declared an interest in this item of business as he sat on the Essex LGPS (Local Government Pension Scheme) Strategy Board and Investment Steering Committee.

 

The MTFS set out how the Council would manage its revenue finances and supported delivery of the Council’s objectives and priorities.  Following a detailed review of budgets, a number of changes had been identified and these were set out in table 1 to the report along with detailed information on the following areas:

 

·                  Changes to MTFS assumptions since February 2023

 

·                  Growths and avoidable pressures – During the budget review a number of budget pressures and growths were identified to meet service demand and had therefore been added to the MTFS.  These were set out in table 2 to the report.

 

·                  Repairs and Renewals – Table 3 identified a number of repairs and renewal expenditure that had been added to the MTFS.  It was noted this could largely be contained within the current budget, although £6,000 was being requested as growth for 2024 / 25.

 

·                  Inflation and Interest Rates – Although reduced and expected to reduce further HM Treasury was forecasting inflation rates to be above the 2% Bank of England target.

 

·                  Areas of uncertainty – These included Pension contributions, New Homes Bonus, Waste, staff pay, Council Tax and business rates.

 

·                  General Fund – Table 4 to the report highlighted the effect on the budget gap following approved amendments and investment returns.  Table 5 provided a projected General Fund Balance.

 

In response to a number of queries from Members, the Interim Chief Finance Officer clarified that:

 

·                  the Council was forecast to overachieve its investment income for this year and the target for 2024 / 25 was a reduction on what was expected to be achieved this year and reflected the gradual reduction in interest rates expected.  It was noted that this was based on advice from the Council’s Treasury Management providers.

 

·                  the Council was required to contribute to the historic pension deficit.  The reserve detailed the best estimate at this time, and this was monitored when the triannual pension evaluation took place.

 

·                  the growth in relation to recycling bags was based on best estimates in relation to the known volume, particular mention was made to the increased volume related to new houses.

 

In response to a question regarding the figures relating to the West Maldon Community Centre, Members were advised that although an estimate, Officers were confident the project could be delivered within the proposed budget

 

The Chairperson moved the recommendations as set out in the report and these were duly agreed.

 

RESOLVED

 

(i)                That the assumptions underpinning the Medium-Term Financial Strategy Summary Update for 2023 / 24 to 2025 / 26 at Table 1 to the report be reviewed.

 

(ii)              That the projected impact on the General Fund Balance set out at Table 5 to the report be noted.

Supporting documents: