Agenda item

To approve:  The General Fund and HRA Budgets for 2025/26, including the use of reserves, Medium Term Financial Strategy, Capital Programmes and Strategy, Treasury Management Policy/Strategy and the Annual Delivery Plan including the  approval of Council Tax levels for recommendation to Full Council (report of the Deputy Chief Executive – Corporate Development (S151) enclosed).

(Please note that in accordance with The Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014, a recorded vote will be taken on Budget recommendations).

(Members are reminded that if they are two months or more in arrears, they must disclose the fact and not vote on any item to set tax or any decision which may affect its calculation).

Consideration was given to the report of the Deputy Chief Executive – Corporate Development (S151) which sought to approve: the General Fund and HRA budgets for 2025/26 including the use of reserves, Medium Term Financial Strategy, Capital Programme and Strategy, Treasury Management Policy/Strategy, and the Annual Delivery Plan, including the approval of Council Tax levels for recommendation to Full Council.

The Portfolio Holder for Finance presented the report, and he thanked the Finance team for working diligently to produce it.  He stated that it was the last Budget to be overseen by the Deputy Chief Executive – Corporate Development (S151) (Christine Marshall) and he stated that she left the Authority in a good place with regard to its budget.

The Portfolio Holder for Finance advised of the following:

·         A correction to Table 12 (Reserve Balances) within Appendix 1 to the report.  This showed the Extended Producer Responsibility (EPR) funding as being received in 2024/25. This would be received in 2025/26;

·         An additional recommendation be added – ‘That the uplift to the real living wage (report section 11.1) be approved’.

The following issues were raised:

·         Councillor Astill  supported the additional recommendation regarding the  minimum wage, announced by the Portfolio Holder – Finance in his presentation. 

·         With regard to the HRA and Capital Programme two points were raised: 1) Gas boiler replacements within the Council’s housing stock – in order to judge if this was value for money, how many houses did this represent?; 2) What were the budgeted fees of £200,000?

o   The Portfolio Holder – Strategic and Operational Housing responded that she could not advise specifically how many houses had received gas boiler replacements however, the spend per property (not just gas boilers, but across the board) has been benchmarked against other authorities and was slightly under the benchmark figure.  Gas boiler replacement would be part of the programme of works for replacement when required.  Contracts and works to the Council’s housing stock was generally of good value and quality.

o   The Deputy Chief Executive – Corporate Development (S151) advised that the increase in 2028/29 and 2029/30 was due to the move to air source heat pumps which were more expensive to install.  Regarding fees, this related to contracts and she would ask that the service provide more details on this area.

·         Members responded that for clarity, it would be useful to separate gas boiler replacements and air source heat pumps as this would show investment in greener energy more clearly. 

o   The Portfolio Holder – Strategic and Operation Housing agreed that this was a good point. Where there were properties with no gas availability, the decision had been taken to install air source heat pumps.  At the time, the technology around air source heat pumps was still new, with opinions divided on their efficacy .  The Authority continued to install both options but would be happy to separate this information out. The Portfolio Holder commented that she was happy to discuss this issue, and information regarding ‘green’ works coming forward, with Councillor Spencer.

·         As Chairman of the Governance and Audit Committee, Councillor Beal wished to thank the Deputy Chief Executive – Corporate Development (S151) (Christine Marshall) for her help, guidance and patience around finance matters pertaining to the Committee.

·         Members referenced the HRA and commented that the write-off of SHDC’s £67.456million loan from central government would support tenants by around £11 per week.  Had any representation been made to Government on this?

o   The Deputy Chief Executive – Corporate Development (S151) advised that representations relating to this debt had been made at the time.  The Government had made it very clear that it did not wish to change its position on that debt.  Many HRAs were experiencing difficulties currently however this Authority’s HRA was doing well.  The challenge around this debt however, still remained now and in the future.

·         Within the table of Fees and Charges (Appendix 5 to the report) the figure of £293 (to be increased to £305 in 2025/26) quoted in regard to High Hedge complaints differed to the amount of £530 currently quoted on the website.

o   The Deputy Chief Executive – Corporate Development (S151) advised that this would be looked into by the service involved.

·         Councillor Alcock wished to take the opportunity to thank the Deputy Chief Executive – Corporate Development (S151) (Christine Marshall) for the courteous way she had addressed members and responded to their queries.  In his opinion, she was one of best officers that the Authority had had over his many years of service as  Councillor.

·         One of the short term options for balancing the budget (paragraph 9.1 of the report) was ‘commercialisation/income opportunities’ – the Government was critical of local authority ventures into the area of commercialisation and caution was therefore required.  In addition, the thrust of Government policy currently to address its principal finances favoured urban rather than rural areas.  Rural areas were again losing out in a number of different areas. 

·         With regard to the situation around the Authority’s partially exempt VAT status, it was important to understand this area to avoid any future difficulties with finances.  Did the risk get greater or remain the same, and was it being monitored?

o   The Deputy Chief Executive – Corporate Development (S151) confirmed that with regard to VAT, this was an area that was monitored diligently.  She received regular reports on the de- minimis situation (which did change), and what actions were required to ensure that there were no breaches.

DECISION:

a)    That the results of the Public Consultation process (Appendix 7) and the minutes of the Joint Performance Monitoring Panel and Policy Development Panel held on 21st January 2025 (Appendix 8) be noted.

b)    That the following recommendations be approved:

1)    That the Revenue Estimates for the General Fund, HRA and Spalding Special for 2025/26 (Appendices 1, 1a, 1b and 1c) be approved.

2)    That the Council Tax for a Band D property in 2025/26 be set at £208.53 (£7.11 per annum increase on 2024/25 levels).

3)    That the Spalding Special Expenses for a Band D be set at £23.13 for 2025/26, (previously £25.83 in 2024/25).

4)    The additions to and use of reserves (as detailed at Appendix 1) be approved.

5)    The Medium-Term Financial Strategy (at Appendix 1) be approved.

6)    That the HRA related staffing changes as incorporated into the budget and specifically detailed at Appendix 1 section 8.2.4 be approved.

7)    That the Capital Programmes and Capital Strategy (Appendices 1, 2 and 3) be approved.

8)    That the Section 25 addendum (Appendix 1) be noted.

9)    That the Treasury Management Policy Statement and Treasury Management Strategy Statement including MRP Policy (at Appendix 4) be approved.

10) That the Fees and Charges Schedule 2025/26 (Appendix 5) be approved.

11) That the Annual Delivery Plan for 2025/26 (Appendix 6) be approved.

c)    That the uplift to the real living wage (report section 11.1 be approved.

(In accordance with the Local Authorities (Standing Orders) (England) (Amendment) Regulations 2014, a recorded vote was taken on the recommendations (Annual Budget Report 2025/26, Medium Term Financial Strategy, Capital Programme and Capital Strategy, Treasury Management Policy/Strategy and Annual Delivery Plan). The vote was as follows: