Agenda item - Financial Strategy 2009-13

This report presents the Financial Strategy for 2009-2013, including the detailed Revenue Budget proposals for 2009/10, and asks the Executive to make appropriate recommendations to Council.

Note: a revised version of the above report, and Annexes 1-6, was published with this agenda on 11 February 2009.

RESOLVED: (i) That, in considering the appropriate levels of Council Tax to be levied by the City of York Council for 2009/10, the following be noted and that the recommendations to Budget Council be made in the light of these considerations:

a) Expenditure pressures facing the Council, as detailed in Annex 1 to the report;

b) The impacts in 2009/10 of the growth requirements and savings proposals outlined in Annexes 3 and 4;

c) Medium term financial factors facing the Council, as outlined in the report;

d) The levels of reserves projected to be held as at 31 March 2009, 2010 and 2011 (Annex 7);

e) The significant future pressures identified;

f) The statutory advice from the Director of Resources;

g) The need to ensure that any adjustments to these proposals are self balancing within the requirements laid down by the Director of Resources as the Council’s Responsible Officer.

(ii) That the following amendments be agreed to the budget proposals set out in the revised report published and circulated to all Members on 13 February 2009:

a) Amendment of the net revenue expenditure requirement for 2009/10 from £116.895m to £117.686m, to take account of the following:

1. amendment to show the funding from unspent contingency in the base budget (-£125,000)

2. an additional Corporate energy and housekeeping saving. (-£175,000)

3. Reduction in trade union facility time saving (+£34,000)

4. Continue to fund post of Conservation Officer (+ £18,000)

5. Remove saving CSHS8 (reduction in support to Visit York) and replace with “savings from Economic Development” (net nil)

6. Investment to achieve energy efficiency through the Council (+£40,000) (one off)

7. Supplementary programme of highways and footpaths maintenance to be funded from Reserves (+£1,000,000) (one off)

8. Increase CSLP10 – Speed enforcement measures (+£30,000) (one off)

9. Waste Minimisation budget allocation (+£10,000) (one off)

10.Reduction in Contingency (-£46,000)

11.Policy prospectus review for ResPark refinement based upon a vehicles carbon emissions (+£5,000) (one off)

b)Amendment of the revenue growth proposals as follows

· Ongoing: from £8.997m to £8.969m (+£18,000 Conservation officer, reduction in contingency -£46,000)

· One off growth from £1.251m to £2.336m (amended as follows: - £1,000,000 for Highways/footpaths, £40,000 energy efficiency, £10,000 waste minimisation, £5,000 policy prospectus ResPark, £30,000 speed enforcement).

c) Amendment of the revenue savings proposals figure from £4.962m to £5.228m.(corporate energy/housekeeping +£175,000, reduced saving re trade union time -£34,000, incorporation of unspent ongoing contingency 2008/09 into savings +£125,000).

d) In terms of the Council’s reserves, to agree to the use in 2009/10 of £3,474,000 (amended from £2,389,000 as follows: - £1,000,000 for Highways/footpaths, £40,000 energy efficiency, £10,000 waste minimisation, £5,000 policy prospectus ResPark, £30,000 speed enforcement).

e) The £186,000 LAGBI grant to York for 2008/09 to be used to fund an Economic Prosperity Programme Reserve.

f) Inclusion of an advance from the Council’s Venture Fund of £100k in 2009/10 and £200k in 2010/11, to be spent on the modernisation of the City’s street lighting stock, which will have the effect of reducing revenue costs and CO2 emissions, these to be included in the Capital Programme.

g) Transfer of £2 m of the Council’s accumulated balances to a capital reserve fund, this sum to be earmarked to support the capital programme in later years, and the Director of Resources to be instructed to undertake a review of, and determine the optimum level of, balances to be retained by the authority in future years.

RECOMMENDED:That Council approve the budget proposals outlined in the report and set out in detail within the Financial Strategy and incorporating the amendments agreed by the Executive, in particular:

a) The net revenue expenditure requirement for 2009/10 of £117.686m, as set out in Annex 1 (as amended);

b) The housing revenue account proposals outlined in Annex 12;

c) The dedicated schools grant proposals outlined in the report;

d) The revenue growth proposals of £8.969m on-going for 2009/10, plus one-off growth of £2.336m, outlined in Annex 3 (as amended), plus an additional £1.138m relating to one-off growth proposals brought forward from 2008/09;

e) The revenue savings proposals for 2009/10 of £5.228m outlined in Annex 4 (as amended);

f) The use in 2009/10 of £3.474m revenue reserves, as outlined in Annex 6 (as amended)

g) The use of prior year Collection Fund surplus of £0.236m;

h) The fees and charges proposals in Annex 8;

i) The IT Development Plan proposals as shown in Annex 10;

j) An advance from the Council’s Venture Fund of £627k in 2009/10 and £626k in 2010/11 to be made to phase 2 of the easy@york project, as outlined in Annex 11, which will enable the project to continue until 2014/15 (plus the £100k in 2009/10 and £200k in 2010/11, for the modernisation of the City’s street lighting stock).

REASON: To provide Council with a balanced set of budget proposals to consider when reaching a decision on the budget and resultant Council Tax to be set for 2009/10.

(ii)That the total Council Tax increase, including the Parish, Police and Fire Authority precepts be agreed at the Council meeting, on the basis of a 4.25% increase in the City of York element of the Council Tax.

REASON: In accordance with the effect of the above recommendations on the budget proposals and taking into account the requirements of the other organisations involved.

Members considered a report which presented a Financial Strategy for the Council for the period 2009 -13, including detailed Revenue Budget proposals for the 2009/10 financial year. A revised version of the report originally published with the Executive agenda had been published and circulated to all Members on 13 February 2009.

The report presented a balanced budget, key features of which included:

A net revenue budget of £116.895m
A Council Tax increase of 4.5%
Funding for pupil-led aspects of education (mainly schools) of £89.243m, to be met by the Dedicated Schools Grant.

A summary of the budget was provided in Annex 1 to the report. Contingency items for 2009/10 were set out in Annex 2 and revenue growth and savings proposals put forward by each department were detailed in Annexes 3 and 4 respectively. A comprehensive consultation exercise had been undertaken as part of the budget process. Details of the items consulted on were set out in Annex 5 and responses to the consultation were summarised in Annex 9.

Executive Members commented individually on those aspects of the budget proposals that fell within their respective portfolio areas, welcoming in particular the proposals for investment in kerbside recycling, measures to cut energy consumption, IT development, the economic prosperity fund and improvements to roads and footpaths.

Having noted the comments made on this item by the UNISON representative and having noted that the Shadow Executive had reserved their position on the budget, it was