Agenda item

To submit the report of the Head of Finance.

The report was submitted by the Cabinet Member for Finance which outlined the budget for 2020/21. It was expressed that the work of planning the budget had commenced in June, and that projections in July had highlighted the need for savings schemes. It was explained that savings schemes had been discussed at the Scrutiny Committees over the past few months and that a number of savings schemes had reduced as some schemes were contentious. It was explained that the budget had been discussed in a series of workshops where all members were invited and the report would be submitted to the Cabinet on 18 February.

The Head of Finance Department added that the budget would be submitted to the Full Council at the beginning of March. It was explained that the draft settlement was better than what had been anticipated and covered inflation. However, it was stated that the draft settlement was insufficient to meet the additional demand on services in the care field. It was noted that the final settlement would be announced by the Government on 25 February.

The Additional Expenditure requirements table was discussed and attention was drawn to the main headings. In terms of Salary Inflation, it was expressed that there would be a salary increase of over 2% in line with the national projection, along with an increase in the employers pension contribution to the Teachers’ Pensions Scheme. It was noted that the Pension Fund had received better than expected returns in recent years and, as a result, the Council would not contribute as much as an employer into the Fund next year. It was expressed that the net figure for schools indicated different positions in different sectors, with a reduction in the number of pupils in primary schools but an increase in the number of pupils in secondary schools. Attention was drawn to the Discontinuation of Specific Grants, noting that the Government funded schemes with grants and then noting that grants would not continue in the following year, and in the case of the child care preventative grant, the money would not be transferred to the settlement either, and the Council, as a result, would need to provide the funding. Attention was drawn to the bids seen under the Pressures on Services heading noting that the level of service in the care departments highlighted the additional demand for services. It was explained that there was a bid for the Homelessness Service, and if an additional grant would be proposed for this field, it was stated that it would be possible to withdraw the bid. It was stated that the budget noted that staff collective agreement adjustments would be abolished completely this year.

Attention was drawn to the Budget Setting table which highlighted the Council's spending needs, and it was explained that the financial deficit would be met by raising Council tax by 3.9%. It was elaborated by stating that the Council Tax increase rate in Gwynedd over the years had been lower than the Welsh average. It was stated that a good consensus had been highlighted at the Budget Workshops held, and the recommendation had been supported by the majority of Council members following these discussions. 

The Head of Finance Department added that Council's balances had been a key instrument which allowed the Council to wait and see the grant settlement situation, before even considering any level of savings above the £2 million. It was explained that balances had bought time and had avoided scaremongering about cuts that were not required for 2020/21. It was added that keeping the balances would allow the use of the same tactics again for the 2021/22 budget. He stated that no Medium Term Strategy had been submitted with the budget this year, as there was uncertainty about the future in advance of the Westminster Government Chancellor's budget that would be announced on 11 March. He confirmed that the budget for 2020/21 was balanced.

Members were given an opportunity to ask questions and offer observations. During the discussion, the following main points were highlighted:

·    The Head of Finance was asked about Transfers to the Settlement and Discontinuation of Specific Grants and he elaborated on what exactly these were. In terms of transfers to the settlement, it was noted that these were continuing grants but that the funding would be transferred to the Council's general grant along with relevant responsibilities. It was highlighted that there were some specific grants where the Council was expected to commit to additional expenditure and that the Council was expected to provide funding when the grants ended.

·         It was asked why Housing Schemes in the capital programme was halving in 2021/22. It was stated that it was inconsistent and slipped from year to year.

·         Concern was noted about many specific grants in the care field from Welsh Government, noting that there were no specific schemes for the future.

·         It was highlighted that the budget was clear and officers from the Finance Department were thanked for their work and support.

            RESOLVED to note and accept the report.