The Interim Chief Officer – Finance, Performance and Change, presented a report, the purpose of which was to seek Council approval of the Medium Term Financial Strategy 2021-22 to 2024-25, attached at Annex 3, which includes a financial forecast for 2021-25, a detailed revenue budget for 2021-22 and a Capital Programme for 2020-21 to 2030-31.

She explained that the MTFS, had been significantly guided by certain key priorities. Although previous year-on-year changes in Aggregate External Finance (AEF) have necessitated significant budget reductions across different service areas, the Council still plays a very significant role in the local economy of Bridgend County Borough and is responsible for annual gross expenditure of around £435 million and was the largest employer in the county borough.

The Council’s Corporate Plan had also been presented to Council for approval alongside the MTFS 2021-25, and the two documents were aligned to each other, hence enabling the reader to make explicit links between the Council’s well-being objectives and the resources directed to support them.

The Interim Chief Officer – Finance, Performance and Change continued by stating that the report was being presented to Council, in order to provide details of the Council’s Medium Term Financial Strategy for the four year period 2020-21 to 2023-24. The MTFS was complimentary to the Council’s Corporate Plan, and looked to provide the resources that would enable the Council’s well-being objectives to be met.

The MTFS focused on how the Council intended to respond to the forecasted public sector funding reductions as a result of on-going austerity and increasing pressures on public sector services, which had been exacerbated during the Covid-19 pandemic.

Quarterly reports to Cabinet during the financial year, on the projected revenue position for 2020-21, had outlined in some detail the impact on the budget of the additional cost pressures and loss of income faced by the Council throughout the year as a result of the Covid-19 pandemic. Welsh Government had played a significant role in mitigating a large proportion of these losses through their various funding streams, most notably the Covid-19 Hardship Fund. Whilst some of these additional pressures were not recurrent, there were a number that would require longer term funding as new ways of working are embedded into the Council’s business as usual, and these were reflected in the MTFS.

The Interim Chief Officer – Finance, Performance and Change advised that the  final settlement from Welsh Government was not due to be announced until 2 March 2021. As a result, the budget was being proposed on the basis of the provisional settlement received in December 2020.

The report went on to outline the financial issues that Council was requested to consider as part of the MTFS 2021-22 to 2024-25. The Council’s Section 151 Officer is required to report annually on the robustness of the level of reserves. The level of Council reserves, she advised, was sufficient to protect the Council in light of unknown demands or emergencies and current funding levels. It should be emphasised however, the Interim Chief Officer – Finance, Performance and Change said, that the biggest financial risks the Council was exposed to at the present time related to the uncertainty of Welsh Government funding, including funding to mitigate the effects of Covid-19, the increasing difficulty in the delivery of planned budget reductions, as well as the identification of any further proposals.

The Interim Chief Officer – Finance, Performance and Change (and Section 151 Officer) confirmed, that she was also required to report to Council if it did not believe that the Authority had sufficient resource to discharge its role as required by S114 of the Local Government Act 1988. She asked Members to note that there was sufficient resources available to discharge this role.

The Interim Chief Officer – Finance, Performance and Change then shared with Council some of the key points that were contained in the reports supporting documentation, ie in the form of Annexes and Appendices, for Members’ information.

The Deputy Leader thanked the Interim Chief Officer – Finance, Performance and Change and the Finance Team for the report and the extraordinary amount of work that had been contributed towards this, in order to reach a balanced budget. It had been very difficult, he confirmed, to agree the Council Tax for the coming year. However, hard choices had to be made following a period of over 10 years of cuts of £68m in terms of a reduction in Council services which had equated to 25% of the total budget of the Council. The £8m savings that was originally anticipated needed to be made to to the budget had been very difficult to find and, early in this year’s MTFS considerations, it had been estimated that Council Tax for the forthcoming year may have to be increased by 6.5% in order for the Council to balance its budget and continue to provide vital services to the public. Both the Council’s Budget Research and Evaluation Panel (BREP) and Overview and Scrutiny Committees had ample opportunity throughout the past 12 months to question Cabinet and the Corporate Management Board on where best savings that were required, needed to be made. He continued saying that the MTFS had been thoroughly discussed, with views of Members sought, as well as those of the public, through the usual consultation exercise we carry out. This had all taken place in the middle of a pandemic, he added. In December 2020, the Deputy Leader advised that Welsh Government (WG) had given BCBC more funding than had been anticipated and this had allowed for certain cuts proposed to be revisited. This meant that efficiency cuts in schools of £1m were no longer required and more money being committed towards homeless people. There had been cost pressures also, for example, in relation to an increase of pupils in schools and to support a real living wage for Council employees. However, the Council had supported the likes of these through the additional WG funding. The extra funding had also meant that the Council Tax increase proposed earlier in the yea,r as estimated above, could be reduced to 3.9%. 

A Member asked if the £300k proposed saving in relation to sports pitches etc, will only be realised if the CAT’s proposed actually proceed to completion.

The Corporate Director – Communities, confirmed that the saving here only related to the CAT transfers that had been committed to by certain clubs and associations for the next financial year, not others that were also in the earlier stages of negotiation.

A Member referred to the Corporate Risk Assessment information on page 165 of the report and risks numbered 14 and 15. She asked if these were Covid related, and what would be in place to mitigate Risk 15, which had been rated as high and was therefore a risk of sum considerable proportion.

The Corporate Director – Education and Family Support believed that this risk was being addressed through current practises that had been put in place in order to negate it. However, he advised that he would consult with the Central South Consortium in order to once more ‘test’ the risk and in turn, come back to the Member with a response, outside of the meeting.

A Member felt that he was unable to support neither the MTFS proposals nor the increase in Council Tax that was proposed. He considered this, due to the effect that the pandemic had on the constituents of the County Borough, whereby a considerable number of these had faced financial hardship through job losses etc, which had resulted in a detrimental effect on their health and wellbeing. He felt that the above proposals were not consistent with the objectives laid out in the Council’s Corporate Plan. He felt that there were alternatives where savings could be made to offset the Council Tax increase, including cuts in back office staff and/or taking money from the Authorities reserves which were in a healthy position.

The Leader advised that all local authorities country wide were having to increase their Council tax, in order to achieve a balanced budget, particularly in response to the added financial pressures public organisations had been faced with as a result of Covid-19 and pay pressures, amongst others. If these were not met this year, they would simply just roll over to next year, together with other financial pressures yet to come. He reiterated the savings the Council had to make since austerity, totalling £68m, during which time the Council had to make a considerable number of its staff redundant as well as cutting public facing services, which had affected the public. No alternative budget had been proposed previously by BREP or through the Overview and Scrutiny Committees, in terms of where the Council could make savings other than in the service areas proposed in the report. Also, a number of recommendations made by both had been agreed to as part of the final MTFS proposals that were before Members today. The Authority did not wish to make savings anywhere, the Leader added, however, there was little option other than to do so, given the current climate and the uncertainties it faced going forward, particularly with regards to the pandemic. If Council Tax was not increased, then further cuts would be required elsewhere including in areas of growth, he added.

The Cabinet had however, agreed to look at revisiting the way BREP operated, in order to improve its function and the way it integrated with the Executive on the MTFS considerations, moving forward.     

Members agreed, in view of the fact that there was conflicting support for the MTFS proposals, to have a recorded vote. The result of this was as follows:-

For:

Councillors S Aspey, SE Baldwin, JP Blundell, NA Burnett, RJ Collins, HJ David, P Davies, PA Davies, J Gebbie, RM Granville, G Howells, M Jones, M Kearn, DRW Lewis, JE Lewis, J McCarthy, D Patel, B Sedgebeer, RMI Shaw, CE Smith, SG Smith, JC Spanswick, G Thomas, DBF White, PJ White, HM Williams and RE Young  =  27 Votes

Against:

Councillors T Beedle, M Clarke, N Clarke, DK Edwards, T Giffard, A Hussain, B Jones, A Pucella, KL Rowlands, R Stirman, R Thomas, T Thomas, E Venables, S Vidal, MC Voisey, L Walters, C Webster, A Williams, AJ Williams and J Williams  =  20 Votes

Abstentions:

Councillors SK Dendy, CA Green, RM James and KJ Watts  =  4 Votes

The recommendations of the report, were therefore carried

RESOLVED:                             That Council approved the MTFS 2021-22 to 2024-25 including the 2021-22 revenue budget and the Capital Programme 2020-21 to 2030-31, including the following specific elements:

                                        • The MTFS 2021-22 to 2024-25 (Annex 3 to the report).

                                        • The Net Budget Requirement of £298,956,245 in  2021-22.

                                        •  A Band D Council Tax for Bridgend County Borough   Council of £1,597.01 for 2021-22 (Table 17 of the MTFS).

                                        • The 2021-22 budgets as allocated in accordance with Table 10 in paragraph 4.1.3 of the MTFS.

                                        • The Capital Programme 2020-21 to 2030-31,  attached at Appendix H of the MTFS.