Agenda item

 

63/21                    

The Council was presented with a report that outlined the recommendations of the Executive in respect of a series of draft revenue and capital budget proposals for 2022/23 to 2024/25 (Minute E.79/21 refers).

 

In their respective introductions, the Leader and Deputy Leader set out the final budget recommendations arising from the Executive meeting held on 27 January 2022.  In so doing, particular reference was made to the proposals in relation to the ‘Step On’ Deposit Scheme and Community Composting Scheme initiatives.

 

During the ensuing debate, reference was made to:

 

(a)      the proposed levels of Unearmarked Reserves.  A Member questioned the justification for the proposal to retain the minimum operating level of Unearmarked Reserves at £2 million.  In reply, the Leader advised that this operating level had been proposed in line with the CIPFA  (Chartered Institute of Public Finance and Accountancy) recommendations and was mindful of the significant uncertainties in relation to future local authority funding reforms;

 

(b)     Gypsy and Traveller sites.  With regard to funding provision for potential Gypsy and Traveller sites, it was agreed that a Briefing Note would be provided to Members outside of this Council Meeting;

 

(c)      amendment number 1.  In accordance with Budget and Policy Framework Procedure Rule 7(J), an amendment had been received by the Head of Paid Service at least four working days before this Council Meeting.  The amendment had been received by Cllrs Birch and Brazil and read as follows:

 

‘That Council resolves not to increase Council Tax for 2022/23 and will retain it at the level set for 2021/22.  The proposed revenue loss of £200,000 be replaced by an allocation out of the New Homes Bonus (mentioned in part 4 of the agenda report recommendation).  The subsequent reduction in the Affordable Housing Earmarked Reserve be covered by a transfer of £200,000 out of the Business Rates Retention Earmarked Reserve.

 

The agenda report recommendations at parts 1 to 12 of the budget proposals be amended accordingly.

 

During his introduction, the proposer made particular reference to:

 

-        the significant rising costs of living and any increase in Council Tax being unwelcome to South Hams residents; and

-        residents having been badly served by the Council’s Waste and Recycling Contractor.  As a result, a Council Tax freeze would be a means for the Council to apologise for the poor service received by residents.

 

In debating the amendment, the following points were raised:

 

(a)       Whilst sympathising with the intent of the amendment, a number of Members highlighted the compounding implications to the Base Budget that would be brought about through freezing Council Tax that would hamper the Council’s financial sustainability in future years;

 

(b)      In support of the amendment, some Members echoed the comments expressed by the proposer during his introduction;

 

(c)       Some Members made the point that the District Council precept only equated to 8% of the overall Council Tax bill.  Therefore, in the event that all of the other precepting authorities increased their respective precepts, then residents would still see an increase in their annual Council Tax bill.  Furthermore, the proposed District Council Tax increase would amount to an increase of less than 10 pence per week.

 

In line with statutory requirements, a recorded vote was then undertaken on the amendment.  The voting on the amendment was recorded as follows:

 

For the motion (12):Cllrs Abbott, Baldry, Birch, Brazil, Hodgson, Jackson, Kemp, McKay, O’Callaghan, Pannell, Sweett and Thomas

 

Against the motion (16): Cllrs Austen, Bastone, Brown, Chown, Foss, Hawkins, Holway, Hopwood, Jones, Pearce, Pringle, Reeve, Rowe, Smerdon, Spencer and Taylor

 

Abstentions (0):

 

Absent (3):  Cllrs Long, Pennington and Rose

 

and the vote on the amendment was therefore declared LOST;

 

 

(d)     Amendment number 2.  In accordance with Budget and Policy Framework Procedure Rule 7(J), a second amendment had been received by the Head of Paid Service at least four working days before this Council Meeting.  The amendment had been received by Cllrs McKay and Thomas and read as follows:

 

‘This Council resolves that the sum of £22,500 be transferred from the Emergency Climate Change Projects reserve to fund a single payment of £22,500 to Sustainable South Hams in recognition of the essential work they have done and to secure their ability to continue to deliver a unique, unmatched and important service in the fight against Climate Change and Biodiversity loss and that the Executive recommendation therefore include the addition of the following:

 

xiii) That the sum of £22,500 be transferred from the Emergency Climate Change Projects Reserve to fund the payment of £22,500 to Sustainable South Hams.

 

In introducing his amendment, the proposer paid tribute to the excellent work that was being carried out by the Sustainable South Hams (SSH) organisation.  In recognition of their excellent work (coupled with the declared Climate Change and Biodiversity Emergency), the amendment was seeking to provide a one-off sum of money to SSH to support them in their work.

 

During the ensuing discussion, the following points were raised:

 

i.           In terms of process, some Members felt it would be more appropriate for SSH to apply to the ‘Climate Engagement Fund’ (which was to be launched in the upcoming weeks).  Furthermore, some Members also felt it to be unfortunate that this amendment had not been given the opportunity for detailed consideration at the joint informal Overview and Scrutiny and Development Management Committee as part of the budget consultation process;

 

ii.         A Member made reference to the Council’s approach to partnership funding arrangements (citing Citizens Advice; the Council for Voluntary Services; and Community Safety Partnership as examples) and felt that the Council should be consistent in its approach and be given the opportunity to review a detailed business case.  In reply, some Members countered by highlighting that SSH representatives were volunteers and it was therefore unfair to compare the organisation to the three partnership examples cited;

 

iii.        A number of Members echoed the introductory comments of the proposer and emphasised the excellent work that was being undertaken by SSH throughout the South Hams.  In particular, SSH was seen to be providing a valuable conduit link between other Community Groups and town and parish councils.

 

In line with statutory requirements, a recorded vote was then undertaken on the amendment. 

The voting on the amendment was recorded as follows:

For the motion (12):Cllrs Abbott, Baldry, Birch, Brazil, Hodgson, Jackson, Kemp, McKay, O’Callaghan, Pannell, Sweett and Thomas

 

Against the motion (16): Cllrs Austen, Bastone, Brown, Chown, Foss, Hawkins, Holway, Hopwood, Jones, Pearce, Pringle, Reeve, Rowe, Smerdon, Spencer and Taylor

 

Abstentions (0):

 

Absent (3):  Cllrs Long, Pennington and Rose

 

and the vote on the amendment was therefore declared LOST.

 

In line with statutory requirements, a recorded vote was then undertaken on the substantive motion.  The voting on the motion was recorded as follows:

 

For the motion (16): Cllrs Austen, Bastone, Brown, Chown, Foss, Hawkins, Holway, Hopwood, Jones, Pearce, Pringle, Reeve, Rowe, Smerdon, Spencer and Taylor

 

Against the motion (12): Cllrs Abbott, Baldry, Birch, Brazil, Hodgson, Jackson, Kemp, McKay, O’Callaghan, Pannell, Sweett and Thomas

 

Abstentions (0):

 

Absent (3):  Cllrs Long, Pennington and Rose

 

and the vote on the substantive motion was therefore declared CARRIED.

 

It was then:

 

RESOLVED

 

1.         That Council Tax for 2022/23 be increased by £5 (Band D of £180.42 for 2022/23 – an increase equivalent to less than 10 pence per week or £5 per year – equating to a 2.85% increase).  (NB. this equates to a Council Tax Requirement of £7,061,585);

 

2.         That the financial pressures (as shown in Appendix A of the published agenda report and amounting to £1,044,600) be approved;

 

3.         That the net contributions to/(from) Earmarked Reserves of £561,600 (as shown in Appendix D of the published agenda report, including the proposed use of £500,000 of New Homes Bonus funding to fund the 2022/23 Revenue Budget (as outlined in section 3.30 of the Executive report from the meeting dated 27 January 2022 (Minute E.79/21 refers)) and £100,000 from the Business Rates Retention Earmarked Reserve (as set out in section 3.21 of the Executive report from the meeting dates 27 January 2022 (Minute E.79/21 refers)) be approved;

 

4.         That £407,557 of the New Homes Bonus Grant allocation for 2022/23 be allocated to an Affordable Housing Earmarked Reserve as a one-off contribution for 2022/23 (as set out in sections 3.30 to 3.31 of the Executive report from the meeting dated 27 January 2022 (Minute E.79/21 refers)) (NB. an amount of £60,000 from the £407,557 is to be allocated to the ‘Step On’ Deposit Scheme pilot);

 

5.         That the savings of £404,000 (as set out in Appendix A of the published agenda report) be approved;

 

6.         That it be noted that South Hams District Council will continue to be part of the Devon Business Rates Pool for 2022/23 following the announcement of the Local Government Finance Settlement for 2022/23;

 

7.         That the Council should set its total net expenditure for 2022/23 at £10,464,367 (as set out in Appendix B of the published agenda report);

 

8.         That the proposed Capital Programme Proposals for 2022/23 (amounting to £1,665,000) and the proposed financing of the Capital Programme (as set out in Appendix E of the published agenda report) be approved;

 

9.         That Unearmarked Reserves should continue to have a minimum level of £1.5 million (as set out in the adopted Medium Term Financial Strategy in September 2021), but an operating level of a minimum of £2 million;

 

10.     That the level of Reserves (as set out in the Executive report arising from the meeting held on 27 January 2022) and the assessment of their adequacy and the robustness of budget estimates be noted (NB. this is a requirement of Part 2 of the Local Government Act 2003);

 

11.     That £280,000 be transferred from Unearmarked Reserves to a ‘Financial Stability Earmarked Reserve’ as part of the process of closing the 2021/22 Accounts, to be available for any future financial pressures from future local government funding reforms and any other budget pressures (the predicted year-end balance of Unearmarked Reserves at 31 March 2022 is £2.28 million) (as set out in Section 7.8 of the published agenda report arising from the Executive meeting held on 27 January 2022) (NB. this would leave an operating level of £2 million for Unearmarked Reserves); and

 

12.     That a one-off amount of £200,000 be transferred into a ‘Community Composting Earmarked’ Reserve in 2021/22 as part of the process of closing the 2021/22 Accounts. (NB. a scheme is to be set up with a one-off budget of £200,000 in 2022/23 for community composting, aligned to savings in the green waste element of the waste contract in 2021/22 (as set out in Section 3.40 of the Executive report arising from the meeting held on 27 January 2022).