Report to follow.
Consideration was given to a report of the Director of Finance which sought approval of the updated forecast budget reduction requirement for 2023/24 and2024/25, having regard to the financial position reported at Budget Council on 2 March 2022,the changing events which had impacted on the finances of the Council in the period leading up to 17 November 2022 when the Autumn Statement was announced by the Chancellor and the subsequent Government funding indications included in the Autumn
The Medium Term Financial Strategy covering the five year period 2022/23 to 2026/27 was agreed by Council on 2 March 2022. At that time, the financial outlook both globally and nationally was significantly different.
Since then there had been a wide range of developments which had impacted upon the financial forecasts presented to Council in March 2022.
On 17 October 2022, the Chancellor of the Exchequer delivered an Emergency Statement which reversed a number of the economic policy changes introduced by the previous Chancellor. This stabilised turbulence in the financial markets which had made financial planning difficult and which had resulted in a number of Local Authorities publicly declaring significant reductions in future financial resilience. The Chancellor also advised that there would be an Autumn Statement to follow shortly afterwards.
This was subsequently deferred until 17 November 2022.
The Autumn Statement has provided the Council with enough information to enable a review of its financial estimates in advance of the receipt of the Provisional Local Government Financial Settlement. As the Autumn Statement focussed on 2023/24 and 2024/25, it had enabled the financial forecasts for those years to be revised to give Members a more informed view of the financial position. This report therefore sets out the updated estimates for 2023/24 and 2024/25 and details the assumptions supporting these projections.
Whilst the Autumn Statement confirmed Government departmental budgets would be maintained at the levels announced in the Spending Review of October 2021, it deferred an element of the planned adult social care reforms, whilst maintaining the level of funding previously announced for the implementation of the reform, thus easing some of the immediate financial concerns. The Government also announced extra support for adult social care and confirmed Local Government would be compensated for the freezing of the Business Rates multiplier. Whilst the exact financial impact will not be clear until the Provisional Local Government Financial Settlement is announced, it has enabled the financial projections to be updated based on the assumptions set out in this report. These assumptions have also incorporated the current financial projections for the 2022/23 outturn as reported elsewhere on this agenda.
Given the financial pressures which had emerged such as increased energy costs, extraordinary inflationary increases and the exceptional on-going demand for Adults and Children’s Social Care services, the budget reduction requirement for the Council had increased from the previously reported position of £16.711m as set out in the Medium Term Financial Strategy agreed at 2 March 2022 Budget Council to £27.975m.
The report set out how the Council ... view the full minutes text for item 7