Agenda item

To consider the Cabinet recommendations in relation to:

·         The General Fund Budget Estimates 2022/23 and the Medium Term Financial Strategy 2022/23 to 2026/27;

·         The Council Tax levels for 2022/2023;

·         The Capital Programme 2022/2025;

·         The Treasury Management Strategy Statement, Capital Strategy and Annual Treasury Investment Strategy for 2022/23.

Members considered the General Fund Budget Estimates 2022/23 and the Medium-Term Financial Strategy 2022/23 to 2026/27; Capital Programme 2022-2025 report presented by Councillor Boden.

Members made comments, asked questions and received responses as follows:

·         Councillor Cornwell stated that he supports the fact that Council Tax is not increased as, in his opinion, the Council has a duty to protect residents, with the pressures on domestic budgets being high, living costs continuing to rise and people have some hard decisions to make and anything that the Council can do to help ease the pressure on its residents is the right thing to do. He expressed his disappointment that the Statutory Bodies consider it acceptable to raise their demands such as the County Council raising their demands by 5%, Police and Crime Commissioner by over 4% and the Fire Authority by 2%. Councillor Cornwell stated that he takes issue with the fact that when he has reviewed the budget he has seen that an increase of 8% within the Council’s budget for drainage board levies up to £1.72 million, which causes him concern and annoyance. He highlighted that within the report it states that drainage board levies will account for almost 22% of the Council Tax figure and, in his view, this cannot continue for very much longer. Councillor Cornwell stated that he understands the need for sustainable drainage, and he has raised the problem in the past and was advised that meetings were due to take place at a high level to see if a more acceptable approach could be achieved for the small number of authorities affected by the drainage rate system. He questioned whether the high-level meetings took place and if so, what was the outcome and if they are still to take place he would like to know it will be so that the Council can look to change the unfair system in this area. Councillor Cornwell asked whether Councillor Boden would give advice to the members who are representatives on the various Internal Drainage Boards prior to the rate levels being set, which will take place over the next few weeks. He further asked that consideration be given for the Council Tax demand notices to give a clear explanation which includes the separate details of the drainage board levies, so that the residents of Fenland can be aware of the monies payable to the drainage boards, which is outside of the Council’s control. Councillor Boden stated that he agrees wholeheartedly with the comments made by Councillor Cornwell and that he shares the concerns raised by him. He expressed the view that the drainage board levies are a serious issue as far as Fenland is concerned and attempts that were made a year ago to look at some leverage with other affected local authorities, which did not progress due to the pandemic, but he explained that he has already made contact with senior councillors elsewhere in the country for this to be taken forward in a structured way. Councillor Boden advised that both himself and the Chief Executive have advised the local MP to express concerns over the drainage board levies in Fenland and to request changes to be made and a paper will be provided to the MP to provide further detail. He stated that he would encourage all members who sit on Internal Drainage Boards as representatives for the Council to ensure that no local drainage board puts in a very significant increase in its levy. Councillor Boden stated that the drainage boards are set up so that there is a majority of local authority members on each drainage board but not everyone has its full complement of local authority members and in some drainage boards the membership is split over a number of local authorities, but he would hope that our members would carefully consider any excessive demands and avoid them if possible. He referred to the point made by Councillor Cornwell with regard to the detail contained on residents’ Council Tax demand notices and stated that it is an excellent idea, however, it would require a change to legislation to allow it to come into effect due to the fact that the format of Council Tax demands is very strictly prescribed.

·         Councillor Count stated having reviewed the figures before him and is in firm agreement with the proposals agreed by Cabinet. He referred to the comments made by Councillor Cornwell with regards to the drainage boards and added that he is a member of the Overview and Scrutiny Panel who have been involved with discussions with Anglian Water concerning issues surrounding flooding in the March area. Councillor Count stated that at a recent County Council meeting, four areas within the County have been identified as being at risk of flooding and March was one of those identified. He explained that as a result it was noted that Anglian Water and the Environment Agency have capital funds which are match funded but was disappointed to note that a proposal of £4.1 million at the County Council, to try and alleviate flood pressures, was rejected by them, especially when they are the Lead Local Flood Authority. Councillor Count expressed the opinion that when you compare the size of the County Council to the size of the District Council, it is difficult to comprehend that even though the County Council have a sizeable amount of funding in their bank accounts, they are still increasing their Council Tax contributions by 4.99% for adult and social care whilst the District Council is trying to keep a 0% Council Tax increase. He added that he agrees with the comments made by Councillor Cornwell with regard to the public’s perception that the Council Tax payments that they make all come to the District Council. Councillor Count expressed the opinion that the Business Plan, in his view, was very easy to read, well prepared document and he congratulated Councillor Tierney for this as it makes a difference to residents as they can have a clear understanding on how their monies are being spent. Councillor Count made reference to the Council’s own reserve policy which Councillor Boden had highlighted and had stated that the Council’s own reserves need to be considered. He expressed the opinion that it is a wise step but added that unlike other reserves it will not solve a structural deficit and that structural deficit should not be confused with the amount held in reserves which is a separate issue. Councillor Count expressed the view that he totally agrees with the statement that Councillor Boden made with regard to the consideration of budgets, and that income generation also has to be looked at to close the gap together with transformation and efficiencies. He feels that only after all of those factors are considered should the taxpayer then be looked to and, in his view, unfortunately this does not appear to be the case with the County Council. Councillor Count expressed the opinion that a 0% Council Tax increase is the right thing to do for Fenland based on the information before members and he will support the proposal.

·         Councillor Yeulett stated that he will support the proposal and he expressed the opinion that Councillor Boden has done a good job under the circumstances and is pleased to see that the budget deficit has been reduced to £203,000.  He asked Councillor Boden to explain how long the Cambridgeshire Horizons money will last and whether there are any further monies anticipated going forward which can be guaranteed? Councillor Yeulett agreed with the point raised by Councillor Boden that much of the financial information provided is based on assumptions, which are wholly or partly influenced by external factors and interest rates, and inflation is rising so questioned how Councillor Boden is going to deal with this going forward when considering future budgets and also what effects future interest rates will have on the Council’s Investment Strategy.  Councillor Yeulett also asked for assurances that the Council will not be out of pocket for financial assistance given to Freedom Leisure.

·         Councillor Boden stated that he agrees with the points raised by Councillor Count and that he is particularly disappointed that March does not have the opportunity to share in the potential £12 million funding pot which would have been available had the County Council agreed with the proposal put forward by Councillor Count and which he had supported. In relation to the question raised by Councillor Yeulett about Cambridgeshire Horizons Ltd (CHL), Councillor Boden stated that after a lot of hard work the Council received almost £3.9 million pounds, with Cambridgeshire Horizons being a company that was set up twenty years ago to promote growth within Cambridgeshire and was very active initially but then went into a state of dormancy, whilst holding a significant amount of money within its bank accounts. He stated that the Council have now received those monies and out of that funding more than £1,000,000 has been set aside already to support financing on the A14 and he explained that there is £1,000,000 which will gradually diminish over 20 years, but it will not only earn interest but can also be used to fund other matters. Councillor Boden advised that there is a surplus of £2.4 million pounds remaining from the Cambridgeshire Horizons money, but it must be spent in accordance with the objectives of CHL itself and whilst the objectives are widely written, the Council’s Section 151 Officer has to justify every penny that is spent from the CHL money on an annual basis. He stated that there is a period of five years left to spend the money and he gave assurances to Council that all of the money will be spent and none of it will be returned. Councillor Boden referred to the point made by Councillor Yeulett with regard to increasing interest rates and stated that rates are predicated to rise significantly over the next two years and external events can change the expectations as far as interest rates are concerned. He added that given the cash equivalent that the Council holds there is a gain for the Council in an environment of increased interest rates, which will be obscured by the fact that the Council is working hard to ensure that it receives higher returns on the monies that the Council holds and therefore there is the expectation to see a significant increased return to the Council on the liquid assets that it holds. Councillor Boden stated that with regard to the point raised concerning Freedom Leisure Ltd it is unfortunate that no guarantee can be made that the Council will not find itself out of pocket due to the financial assistance given to them. He added that due to contractual agreements, the Council found itself in a position where it was obliged to provide financial support to them which commenced with grant aid and then as time has gone on the support has evolved into loans which are repayable when certain targets are met by Freedom Leisure. Councillor Boden stated that the amount loaned equated to £1.2 million pounds and £400,000 of that figure was off set with the Government support which came through to Councils such as Fenland who has contracted out their leisure services, however, there is still an outstanding amount in loans of £800,000 and this is being closely monitored along with support being provided to Freedom Leisure to meet and exceed their targets and there is every hope that during the course of the remaining term of the contract the outstanding monies will be paid.

·         Councillor Sutton stated that he will reserve his support for this agenda item, although he supports the no increase to Council Tax, but would like to have seen a decrease as, in his opinion, Fenland’s proportion of the Council Tax is far higher than neighbouring authorities. He referred to page 92 of the report, where it mentions £1,000,050 being set aside for the A14 upgrade, expressing the view that historically under a previous leadership, that figure had been negotiated down to £800,000 and he is concerned that in the 2021/22 budget report there was a sum set aside of £32,000 per annum whereas in the report for 2022/2023 the figure is shown as £42,000 and questioned how that figure has changed and why the Council is paying £250,000 more than was previously agreed. Councillor Boden stated that the point that Councillor Sutton has made is incorrect as he has stated that the amount of liability going toward the A14 improvements has increased to £250,000, when the correct amount is actually £1,000,050, with the £800,000 and the £32,000 figures that Councillor Sutton had quoted still in existence and will continue year on year as the £1,000,050 is an additional liability due to the fact that when the monies were received from Cambridgeshire Horizons Limited, they had already committed to just over £5,000,000 of support to the A14 project and, therefore, when the £2,840,000 from CHL was received to be used for the Council’s benefit, at the same time £1,000,050 liability was also taken on for the A14, with the Council receiving the cash for this. He expressed the opinion that it is a good position for the Council to be in as it provides the Council the opportunity to use the funds even though it diminishes by £42,000 over the next 20 years. Councillor Boden explained that the Council were given the additional funds by CHL, this is what is reflected in the budget figures within the report and the Council has the opportunity to utilise the money over the specified period of time albeit an additional liability for the A14, but it is fully funded in advance.

·         Councillor Sutton asked for clarification that Councillor Boden’s explanation means that there is still the £800,000 liability plus the £1,000,050 which is cost neutral as the money has been given to the Council. Councillor Boden stated that it is not cost neutral it is cost beneficial to the Council as the Council has the advantage of using the cash whilst it is being paid back over the 20-year period. He clarified that the £800,000 is unchanged and will be re-paid at £32,000 per year and the £1,000,050 has been paid to the Council up front and has to be repaid to the Department of Transport at the rate of £42,000 a year. Councillor Sutton thanked for Councillor Boden for the explanation and confirmed he would be happy to now support the recommendations within the report.

·         Councillor Tierney thanked Councillor Count with regard to his praise concerning the clarity and improvements to the presentation of the Business Plan document and stated that it is mainly down to officers for the way the document is prepared, and his input is minimal. He expressed the view that he is pleased to see the members of the opposition supporting the budget proposals and low tax ambitions as the attitude of the opposition at Fenland is different to the opposition members at the County Council. Councillor Tierney stated that, in his view, the Council are doing the right thing with regards to a no Council Tax increase as the financial situation is only going to get worse for those members of the public who are already on the breadline. He added that there are the consequences of environmental net zero policies which are going to cost a great deal of money, the costs of Covid spending and international conflicts which will all prove to be costly and, in his opinion, if ever there was a time for Councils to tighten their belts to take the pressure off the public that time is now. He stated that he is proud of the Leadership, of officers and of the opposition and he will be supporting the recommendation.

·         Councillor Cornwell asked for it to be recorded that the Fenland Independent Alliance have no links whatsoever with those County Councillors who claim to be Independent or members of other political parties.

Proposedby Councillor Boden,seconded byCouncillor Tierney and AGREED that

(i)       the General Fund revenue budget for 2022/23 as set out in Section 9 and Appendix A be approved;

(ii)      the Medium-Term Financial Strategy as outlined in this report and Appendix B be adopted;

(iii)    the Capital Programme and funding statement as set out in Appendix D be approved;

(iv)    the adoption of the additional Business Rates Relief measures as detailed in Section 6 and Appendix H using Discretionary Relief Powers be approved;

(v)      the expenses detailed in Section 12 be approved to be treated as general expenses for 2022/23;

(vi)    the Port Health levy for 2022/23 be set as shown in Section 13;

(vii)   the Treasury Management Strategy Statement, Minimum Revenue Provision, Treasury Investment Strategy, Prudential and Treasury Indicators for 2022/23 and Capital Strategy 2022/23 as set out in Section 15 and Appendix E be approved;

(viii)the Band D Council Tax level for Fenland District Council Services for 2022/23 be set at £260.46, no increase on the current year.

The Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014 imposean obligation on Local Authorities (after 25 February 2014) to record all votes on decisionson budget and Council Tax,with thisin mind Membersvoted onthis itemas follows:

In Favour: Councillors Benney, Boden, J Clark, S Clark, Cornwell, Count, Mrs Davis, Divine, Mrs French, Miss French, Hay, Hoy, Humphrey, Mrs Laws, Lynn, Marks, Mason, Mrs Mayor, Meekins, Miscandlon, Mockett, Murphy, Patrick, Purser, Sutton, Tanfield, Tierney, Wallwork , Wicks, Wilkes and Yeulett.

Against: none

Abstentions: none

(Councillor Mrs Bligh left the meeting at 17.30 during consideration of this item and took no part in the vote on this item or the remaining agenda items)