9
The Council received report ES/0672 of Councillor Cook, the Cabinet Member with responsibility for Resources, which set out the proposed General Fund Budget and Council Tax resolutions for 2021/22, along with the Medium Term Financial Strategy (MTFS) for 2020/21 to 2024/25.
Councillor Cook introduced the report, supported by members of the Finance team. Councillor Cook thanked officers for their incredible work over the last year, carried out under the most trying of circumstances.
The Council was advised that the proposed budget arrangements had been subject to intensive scrutiny and consultation and was the culmination in one of the most challenging years in local government finance. Councillor Cook said that the current challenges would be ongoing, but the Council's robust financial position allowed it to meet these challenges and maintain both financial sustainability and set a 0% increase in its element of Council Tax for 2021/22.
Councillor Cook summarised the significant developments that had occurred since the draft budget had been considered by the Cabinet at its meeting on 2 February 2021; the government's commitments on Business Rate retention, tax income scheme compensations to local authorities and the pooling of benefits from the Suffolk Business Rate pool, augmented by savings achieved from changes in operational partnerships in 2020/21 and a number of government grant funding streams being confirmed and reinstated in the MTFS from 2022/23 onwards, had significantly improved the forecast position and had resulted on a smaller reliance on the Council's reserves to balance the budget for 2021/22.
Councillor Cook outlined the information set out in the report's appendices and highlighted the Chief Finance Officer's report at Appendix D, which concluded that the budgetary proposals were robust, and the Council's reserves were adequate for the 2021/22 budget plans.
Councillor Cook referred the Council to the recommendations contained in the report and commended it to the Council for approval. Councillor Steve Gallant seconded the report and reserved the right to speak.
The Chairman announced that the Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014 required local authorities to amend their Standing Orders to include the need for recorded votes at meetings where decisions on the budget are made. Therefore, in accordance with Paragraph 15.5 (Recorded Votes) of Part 3 of the Constitution, the Council was advised that there would be a recorded vote for this item.
The Chairman invited questions to Councillor Cook.
In response to a question from Councillor Brooks, Councillor Cook confirmed that the passing on of the support grant to towns and parishes in the district had contributed towards lower increases in their Council Tax precepts; it was noted that the overall increase this year from towns and parishes was 0.29%, compared to 4% in 2020/21.
Councillor Burroughes asked what put the Council in a strong position to deliver a 0% increase on its Council Tax element. Councillor Cook explained that this approach had been suggested by Councillor Gallant in late summer/early autumn 2020 and discussions had taken place with officers in the Finance team to look at the option, its impact on the MTFS and if it was a realistic prospect. Councillor Cook said that the proposal had been considered over several stages before it was confirmed that it was possible to do so without having a negative impact on the Council's finances.
Councillor McCallum asked if the Council had received sufficient financial support from the government during the COVID-19 pandemic. Councillor Cook considered the financial support from the government to have been good and noted the various grants made available for the Council to support over 8,000 businesses in the district. Councillor Cook added that the government had listened to the concerns of councils about certain businesses falling through the cracks and had provided grant funding for smaller businesses.
Councillor Beavan sought further information on the impact of the governments additional support on using the Council's reserves to balance the budget. Councillor Cook advised that £2m of reserves in 2021/22 would be required, with a further £2.2m required in 2022/23, which would be taken from the Council's in-year savings reserves. Councillor Cook said that future figures could not be forecast until the NNDR1 returns were confirmed by the government.
In response to a question from Councillor Byatt, Mr Baker confirmed that the reference in paragraph 4.1 of Appendix E, to a deadline being met, related to the Council meeting the deadline to report annually on its gender pay gap and publishing this information. Mr Baker confirmed that the Council would meet the required deadline.
The Chairman invited the Committee to debate the proposals.
Councillor Byatt noted the number of people on the Council's housing list and compared this against the pledge to build 50 new homes a year. Councillor Byatt suggested that the Council be creative in its spending to go beyond its housebuilding target and queried if money could be diverted from other projects to contribute towards this, displaying a list of allocated project funding and asking if all these projects were essential.
Councillor Cook responded that he could not comment on individual projects or speak for other Cabinet Members and officers. Councillor Byatt accepted this but considered it important to see if the Council could be creative in the future and "do differently".
Councillor Beavan expressed concerns about the proposed Council Tax freeze and considered that it was a nice but misguided gesture. Councillor Beavan was of the view that the savings it would provide for residents would not be sufficient in real terms and highlighted that officers were being asked to do more for less. Councillor Beavan hoped that the Council would forgo any rise in councillors' allowances in 2021/22.
Councillor Beavan continued to say that he hoped the government's generosity would not be countered by service cuts in the future, that would impact the district's worst-off residents. Councillor Beavan remained concerned about the impact of COVID-19 and the shortfall in budgets in the years to come; he welcomed Councillor Cook's announcement that less of the Council's reserves would be needed to balance the budget but, noting comments made to the Scrutiny Committee about reserves being for a rainy day when it reviewed the draft budget, considered the forecast to be bleak.
Councillor Beavan was unconvinced by the forecast in the MTFS that the Council Tax base rate would increase by 1% and was dubious of further government support. Councillor Beavan concluded that as well intentioned as the Council Tax freeze was, the Council should not be using its reserves to make up the shortfall.
Councillor Smith-Lyte highlighted a case she had been made aware of where a second-home owner in Southwold had been pressured into accepting a £10,000 grant, highlighting that this individual had not been required to make an application to receive the money, which he had later donated to charity. Councillor Cook suggested that Councillor Smith-Lyte had been misinformed and that there was a robust, application-based process in place for grant funding. In response to Councillor Smith-Lyte's request that the Scrutiny Committee look into this issue, Councillor Cook advised that this would be up to the Chairman of the Scrutiny Committee.
Councillor Bird raised a point of order as debate was not being conducted in accordance with the Council Procedure Rules set out in the Council's Constitution, in that it had become exchanges between Members on specific points. This was noted by the Chairman.
Councillor Mallinder considered that the environment was at the heart of everything the Council did and that it put its people first. Councillor Mallinder said a Council Tax increase would impact the most on those residents worse off and the Council freezing its element would be of benefit, noting that this had been achieved without a reduction in services; he stated that the Council's services had been made fit for the future and provided value for money. Councillor Mallinder highlighted the need for long term environmental solutions and was of the view that Councillor Cook had been able to ensure that there were strong foundations for the Council to build a future for East Suffolk where the environment was at its heart. Councillor Mallinder supported the paper and thanked Councillor Cook for his hard work.
Councillor Ritchie contended that the Council did "do differently" when it came to its house building programme and noted the work undertaken by one of the Council's predecessor authorities, Waveney District Council, in building the Housing Revenue Account that was inherited by East Suffolk Council when it was created in April 2019. Councillor Ritchie was of the opinion that the Council was at the forefront of providing housing by committing to building 50 new homes a year, in addition to buying houses to add to its stock.
Councillor Ritchie also noted that the creation of East Suffolk Council, and the partnership working between Suffolk Coastal and Waveney District Councils preceding this, had contributed to the financial position the Council found itself in now. Councillor Ritchie thanked Councillor Cook and the Finance team for their hard work to ensure that a 0% increase in Council Tax could be achieved.
Councillor Frank Mortimer referred back to the information put forward by Councillor Byatt and suggested that such information should be circulated to the Council before the meeting. Councillor Mortimer also queried if Councillor Beavan had proposed an alternative budget.
Councillor Mapey noted that the freeze in Council Tax assisted people such as himself, a publican, whose income had been significantly affected by the pandemic. In response to the comments made by Councillor Smith-Lyte, Councillor Mapey suggested that the property in question may well have been "flipped" and listed as a business address to qualify for a Business Rates holiday and suggested that if the owner wished to change this back, the Council would be happy to receive the Council Tax from this dwelling.
Councillor McCallum echoed Councillor Mapey's comments as a fellow publican; she confirmed that she had not been offered any grant without having to apply for it first. Councillor McCallum thanked the Council and the Government for giving lifelines to businesses during the pandemic.
Councillor Herring highlighted that the Council's predecessor authorities had received summary presentations of budgets and considered that this would have been helpful but acknowledged the ongoing impact of the pandemic on officers' time. Councillor Herring supported the freeze in Council Tax and noted that the Council was able to do so because of the strength of its finances. Councillor Herring advised that not keeping Council Tax in line with inflation over the medium-term would diminish its value, highlighting it was the Council's one secure piece of income.
Councillor Herring emphasised the continual strength of Business Rates retention, started by the predecessor authorities. Councillor Herring considered this measured the strength of East Suffolk's economy. Councillor Herring said that the local economy and viability of businesses needed to be supported as the country came out of the pandemic and suggested that the Council looks at its strategy to ensure that it reinforces and reinvests in the local economy.
Councillor Topping noted that the excellent financial scrutiny training provided to the Scrutiny Committee had helped her to understand this report and suggested that this training would be beneficial for all Members. Councillor Topping also referred to recent training she had received around risk management and the cumulative impact of amber risks.
There being no further requests to speak, the Chairman invited Councillor Gallant to address the Council.
Councillor Gallant noted the points raised by Councillor Byatt and considered that now was not the time to address them and added that the Council would not stop building houses in a year once it had reached 50.
Councillor Gallant referred to Councillor Beavan's comments on the Council Tax freeze and noted that not all residents of East Suffolk were in the position where such a move could be considered as simply a gesture; he noted this saving could be a significant proportion of someone's household budget. Councillor Gallant agreed with Councillor Beavan's analogy of a bleak forecast and considered that this meant the Council needed to support its residents during these times.
Councillor Gallant concurred with Councillor Mapey's comments that the homeowner referred to by Councillor Smith-Lyte may well have listed their second home as a business address and was therefore made aware of their eligibility for a grant. Councillor Gallant noted that there were cases of people living in second homes listed as holiday lets, for Council Tax purposes, and stressed that he and Councillor Cook would be pushing the Government to close this loophole. Councillor Gallant highlighted that the Council Tax freeze was not simply a 'holiday' from Council Tax for residents.
Councillor Gallant reiterated that the proposed budget did not include any cuts to services or any cuts to the Council's ambitions, and that the aim of the Council Tax freeze was to avoid adding to residents' financial pressures. In reference to Suffolk County Council (SCC) raising its own element of Council Tax, Councillor Gallant said that SCC was a different authority with different responsibilities, and what was proposed today would allow the Council to relieve pressure on SCC.
Councillor Gallant concluded by saying the paper was an excellent one, commending it to the Council and urging Members to support it.
There being no further matters raised for debate, the Chairman moved to a recorded vote of those present on all the recommendations, as proposed by Councillor Cook and seconded by Councillor Gallant. The results of the vote are shown below:
For the recommendations set out in the report (43 Members)
Councillors Melissa Allen, Paul Ashdown, Edward Back, Stuart Bird, Chris Blundell, Norman Brooks, Stephen Burroughes, Peter Byatt, Alison Cackett, Jenny Ceresa, Judy Cloke, Maurice Cook, Tony Cooper, Linda Coulam, Janet Craig, Mike Deacon, Tony Fryatt, Steve Gallant, Tess Gandy, Andree Gee, Tony Goldson, Louise Gooch, Tracey Green, Colin Hedgley, Ray Herring, Mark Jepson, Stuart Lawson, James Mallinder, Chris Mapey, Debbie McCallum, Frank Mortimer, Trish Mortimer, Mark Newton, Keith Patience, Malcolm Pitchers, Carol Poulter, David Ritchie, Craig Rivett, Keith Robinson, Mary Rudd, Letitia Smith, Steve Wiles, and Kay Yule.
Against the recommendations set out in the report (6 Members)
Councillors David Beavan, Elfrede Brambley-Crawshaw, Graham Elliott, Rachel Smith-Lyte, Edward Thompson, and Caroline Topping.
Abstentions (1 Member)
Councillor John Fisher.
Therefore, it was by a majority vote
RESOLVED
That the Council:
1. Consider the Chief Financial Officer’s report attached at Appendix D;
2. Approve the Medium Term Financial Strategy for 2020/21 to 2024/25, including the General Fund Revenue Budget for revised 2020/21; proposed 2021/22; and forecast budgets for 2022/23 to 2024/25 as set out in Appendix A;
3. Approve the movements to and from Earmarked Reserves and the General Fund Balance for 2020/21 to 2024/25 as set out in Appendix A6;
4. Approve the items to be treated as special items in 2021/22 as set out in Section 6 – the precepts by town/parish councils and parish meetings;
5. Approve a Band D Council Tax for 2021/22 of £171.27, which is no increase on 2020/21;
6. Approve the Efficiency Strategy attached as Appendix B;
7. Approve that discretionary Section13a (1)(c) Covid-19 Hardship Reliefs (Appendix C) be applied at a flat rate of £30 to the 2021/22 council tax bills of:
a) customers in receipt of working age Local Council Tax Reduction Scheme reliefs as at 1 March 2021; and
b) customers in receipt of working age Local Council Tax Reduction Scheme reliefs between 1 March 2021 and 31 March 2021
8. Approve the Pay Policy Statement set out in Appendix E;
9. Approve the Council Tax Resolutions in Appendix F;
10. Grant to the Chief Finance Officer delegated authority to award any discretionary business rate reliefs arising from the 3 March 2021 Budget Statement under Section 47 of the Local
Government Act 1988.