Consideration was given to the report of the Assistant Director Resources on the preparation of the draft Revenue Budget for 2021/22.  The report outlined the likely financial position and key issues that Members needed to consider as part of the budget setting process.  Appended to the report were details of the summary draft Revenue Budget, the summary information for each service area, main changes from the 2021/22 budget, the Council’s revenue reserves and identified savings and additional income.

All budgets were shown as “Net Operational Expenditure Levels” which excluded capital charges, central costs and support service recharges.  In addition, budgets were shown on a departmental basis which provided Members with a clear identifiable cost for each service.

The following key issues were highlighted: 

Ø  as the Council no longer received any Revenue Support Grant it was wholly reliant on revenue from business rates, council tax, specific grants, charges for services and income generation in meeting its net budget;

Ø  the draft settlement announced by Government in December confirmed that the Council’s share of business rates remained unchanged from 2020/21, a specific additional COVID-19 grant of £519,000 to support the ongoing effects of the pandemic in 2021/22 would be received and additional support to extend the extra support for residents through the Council Tax Reduction Support scheme (CTRS) amounting to approximately £146,000;

Ø  New Homes Bonus grant was expected to be £271,770 and would be incorporated into the draft budget to reduce the use of reserves, with no ongoing reliance;

Ø  further work to refine the business rate estimate in time for the final approval of the Revenue Budget in February was on-going;

Ø  the 2021/22 council tax base had been calculated at 37,606.6 and showed a reduction of 518 Band D equivalents mostly due to an increase in the number of CTRS claimants expected in 2021/22 as a result of the pandemic; the in-year recovery rate for Council Tax had reduced to 98.2% from 98.5%, taking into account the increased risk of non-payment due to the effects of the pandemic on employment;

Ø  the council tax referendum principle for Rother would allow an increase in council tax of £5 or 2% whichever was the highest; it had been assumed that the Council would increase Council Tax by the maximum allowed before a referendum was required;

Ø  for 2021/22 to ensure the Council remained within the referendum limit, it was assumed that an increase of £4.94 to £189.04 would be agreed for a Band D property, resulting in additional income of £90,000.

The financial risks that may affect the Council’s finances were highlighted within the report and these included homelessness demands, staffing costs, the impact of COVID-19 on the Council’s commercial tenants, leisure, swimming centres, cultural services delivered through two charitable trusts (Freedom Leisure and the De La Warr Pavilion Trust) and the emerging new Corporate Plan which aspired to accelerate the development of new housing in Rother, both market and affordable, deliver on the commitment to be a carbon neutral  ...  view the full minutes text for item 86