URL: https://democracy.cambridge.gov.uk/ieDecisionDetails.aspx?ID=5624

Decision Maker: Executive Councillor for Finance and Resources

Outcome: Recommendations Approved

Is Key Decision?: Yes

Is Callable In?: No

Purpose: To agree the Council’s General Fund Medium Term Financial Strategy, including the net savings requirement for the next 5 years, and revised General Fund revenue, funding and reserves projections.

Content: Matter for Decision The purpose of the MTFS was to project the General Fund’s financial position over the medium term, and set out the high level strategic approach to ensuring financial sustainability over this period.   Decision of Executive Councillor for Finance and Resources   i.                To approve the Council’s General Fund Medium Term Financial Strategy (MTFS) 2025/26-2034/35, as attached at Appendix A. ii.               To approve the 2024/25 capital bid of an additional £487,000 for essential repairs of the riverbank at Jesus Green, as set out at page 19 of the attached MTFS. iii.             To note the other changes to the capital plan approved under delegated powers since approval of the Budget Setting Report, as set out in section 5 of the attached MTFS. iv.             To set the General Fund reserve Prudent Minimum Balance at £6.541 million, and the target level at £7.849 million, as recommended by the Chief Finance Officer.   Reason for the Decision As set out in the Officer’s report.   Any Alternative Options Considered and Rejected Not applicable.   Scrutiny Considerations The Committee received a report from the Chief Financial Officer outlining the MTFS.   In response to Members’ questions the Chief Financial Officer and the Executive Councillor for Finance and Resources commented:   i.                The target of £6 million of savings over two years was an ambitious one. As the Council had been financially prudent over the previous years it was now easier to make some of the savings that were required to balance the budget gap, rather than having to find £11.5 million of savings in the next two years. ii.               In terms of being able to deliver some of the proposed savings the Group redesign would go into more detail the ways the Council was going to deliver services whilst recognising savings that needed to be made. iii.             Looking further into the future officers were having to make assumptions with regards to some of the key financial indicators and this was harder to predict the further out the strategy looked. iv.             Officers were already looking at ways of bridging the budget gap from £6 million to £11.5 million. v.              It was essential to make services more efficient and effective wherever possible. There were circumstances that dictated that sometimes less was less when it came to delivering some services and those were decisions that Council had to think through. The key for the Council was to make sure the Council was financially sustainable for the future. vi.             The Council still aimed to deliver excellent services to its residents, including carrying out its programme on housing development. It was essential to make the right level of savings that delivered the least harm to front line services. vii.           The MTFS assumptions were based on the report produced by the Bank of England in August. The scenario’s in the report were based on this and fell within the Bank of England’s confidence range. Scenario one was the worst case scenario and reflected CPI going back up to 5.3%. viii.         All businesses had an independent re-valuation of their business rates which was carried out by the government. The last re-valuation was effective from April 2023. There was a deadline for businesses to appeal against the previous re-valuation done in April 2017 and that was 31 March 2024. The Council was required to make a provision for any successful appeals that were made, although most of the appeals were speculative. ix.             The Council were in talks with government over the impact of future growth on the city and the services that are provided. The Leader confirmed that they had raised the issue of poor data that had an impact on funding levels for the Council. It was about more than housing and growth but around finances for the Council as a whole. Part of the discussions with government was to show that the Council was prudent with its finances and well run. x.              Officers were to check the A14 project earmarked reserves fund and provide any future updates. This earmarked fund could be reallocated to environmental improvements or transport mitigations.   The Scrutiny Committee approved the recommendations, a vote on each recommendation set out below.   i.Approve the Council’s General Fund Medium Term Financial Strategy (MTFS) 2025/26-2034/35, as attached at Appendix A. (5 for, 0 against, 2 abstentions) ii.Approve the 2024/25 capital bid of an additional £487,000 for essential repairs of the riverbank at Jesus Green, as set out at page 19 of the attached MTFS. (Unanimous) iii.Note the other changes to the capital plan approved under delegated powers since approval of the Budget Setting Report, as set out in section 5 of the attached MTFS. (Unanimous) iv.Set the General Fund reserve Prudent Minimum Balance at £6.541 million, and the target level at £7.849 million, as recommended by the Chief Finance Officer (Unanimous)       The Executive Councillor approved the recommendations.   Conflicts of Interest Declared by the Executive Councillor (and any Dispensations Granted) No conflicts of interest were declared by the Executive Councillor.  

Date of Decision: September 30, 2024