To enable the Cabinet to consider the recommendations submitted to it by the Resources and Services Overview & Scrutiny Committee following that Committee’s scrutiny of the Cabinet’s initial budget proposals at its meeting held on 13 January 2025.

RESOLVED that the recommendations made by the Resources and Services Overview & Scrutiny Committee be noted and that the response of the Portfolio Holder for Corporate Finance & Governance thereto be endorsed.

Cabinet was awarethat, in accordance with the requirements of the Budget & Policy Framework Procedure Rules, the Resources and Services Overview and Scrutiny Committee (“the Committee”) had undertaken its scrutiny of the budget for the Council.  Prior to its meeting on 13 January 2025, the Members of the Committee, had met informally on 6 January 2025 with the Section 151 Officer and the Head of Democratic Services & Elections in attendance. That informal meeting had aided the Members of the Committee in developing key lines of inquiry for its formal scrutiny meeting that had been held on 13 January 2025.

At the Committee’s formal meeting on 13 January, it had been aware that the initial General Fund and the Housing Revenue Account (HRA) Budget proposals for 2025/26 had been considered by Cabinet on 20 December 2024. 

The Committee had been provided, as part of the material for them to consider, the following:

1)       Updated General Fund Financial Forecast / Budget 2025/26 – the report considered by Cabinet on 20 December 2024.

2)       Updated Housing Revenue Account Business Plan and Budget Proposals 2025/26 – the report considered by Cabinet on 20 December 2024.

Following the informal meeting of the Committee held on 6 January 2025 a series of written questions had been circulated to Portfolio Holders and their responses had been circulated to the Committee prior to its formal meeting on 13 January 2025.  The Minutes of that formal meeting recorded those questions and responses in an Appendix.

At the 13 January meeting further, supplementary questions had been asked of Cabinet Members and responses provided. Those further responses had been also recorded in the Appendix to the Minutes.

The Committee had resolved to RECOMMEND to Cabinet that –

“(a)  That the Committee has recorded that it felt that it was not in a position to comment on the robustness of the budget plans for 2025/26 and beyond and, in this regard, it noted that:

(i)    in respect of the General Fund, the Forecast Risk Fund (used to smooth deficits in particular years) would be exhausted within 2028/29 and (as at the day of the meeting) there were no specific plans to address the full savings/income generation necessary up to that point to support a balanced budget from that point; 

(ii)   in respect of the Housing Revenue Account, there were not the written plans to move it to a sustainable position;

(iii)  through the papers submitted and statements made to the Committee, it was understood that plans to address (i) and (ii) were being worked upon; and

(b)   That Cabinet be informed of the above and requested to address the issues raised.”

Cabinet had before it the following written response of the Portfolio Holder for Corporate Finance & Governance:-

“In respect of the GF / HRA budget proposals, I do not recognise the point made by the Committee relating to them not feeling that they were in the position to comment on the robustness of the budget plans for 2025/26 and beyond.

The various Financial Performance Reports considered by Cabinet during the year that the Committee were invited to comment on, along with the detailed report considered by Cabinet in December that the Committee had in front of them at their meeting on 13 January 2025, set out a significant level of detail covering the long term forecast, risk assessments including the adequacy of reserves, savings plans and cost pressures.  

As recognised by the Committee via the point they raise within (a)(iii) and as discussed directly at their meeting, Cabinet have already acknowledged the associated challenges ahead in terms of the further development of the savings plan. This was further addressed within the Cabinet’s Initial Highlight Priorities that were also presented to the Committee at their meeting on 13 January 2025.

For completeness, Cabinet’s Initial Highlight Priorities included:

Deliver Savings Plan for 2025/26

•    To take the necessary steps to implement outstanding items included within the adopted Savings Plan for 2025/26.

•    To review the Saving Plan set against the long-term financial forecast and the impact of the Local Government Finance settlement (as it relates to the District), including the Government’s longer term funding review, to develop a ‘pipeline’ of options for consideration.

Develop Savings Plan for 2026/27

•    Complete the implementation of the items in the 2025/26 Savings Plan and develop the requirement for Savings in 2026/27 and beyond.

To develop proposals to secure the long-term sustainability of Housing Revenue Account (HRA)

In respect to the Council’s own housing stock, drive improvement with expanded estate management. To develop the long term HRA 30 Year Business Plan proposals to secure sustainability of the HRA to include:

•   Management of long term empty properties

•   Responding to the new Government’s drive to increase the stock of social housing e.g. additional flexibilities relating to retained “Right-to-Buy” (RTB) receipts

Develop a High Level Transformation Strategy and a Targeted Plan for 2025

Develop a Transformation Strategy/Plan to include the active management of the Council’s costs and liabilities and addressing both supply side and demand side challenges faced by the Council. Possible areas to address in the Strategy/Plan would be:

Supply Side –

•   Investment in AI and channel shift / move to new technologies / in-house development of new applications / processes to improve efficiency and business operations

•   Service reviews including service standards reviews – including gap analysis etc.

•   Data lake infrastructure and science / informed decision making / data dashboards / realtime performance reporting

•   Developing the Project Delivery Unit approach to respond to evolving projects and priorities

Demand Side –

•   Developing self-service / customer portals initiatives

•   Development of chat bot / AI technology on the Council’s website

•   Continue to develop the Council’s website

•   Develop communication activities / use of media channels and interaction with customers and partner

Further updates will therefore be provided to the Committee during 2025/26 alongside the development of the associated plans, and Cabinet will continue to invite comments from the Committee as part of the associated and regular reports that will be presented throughout 2025/26.

In addition to the above, it is also worth highlighting that Cabinet’s approach set out above is not dissimilar to arrangements put in place by previous administrations where full detailed plans to deliver financial sustainability over multi-year periods were not produced.”

Having duly considered the recommendations made by the Resources and Services Overview & Scrutiny Committee together with the written response of the Portfolio Holder for Corporate Finance & Governance thereto:-

It was moved by Councillor I J Henderson, seconded by Councillor Baker and:-

RESOLVED that the recommendations made by the Resources and Services Overview & Scrutiny Committee be noted and that the response of the Portfolio Holder for Corporate Finance & Governance thereto be endorsed.