Members considered a report setting out the major financial pressures the Council is likely to face over the next four years, together with a proposed strategy for setting a balanced and sustainable budget for 2013/14 and beyond.  In light of the challenging financial position facing all authorities two years ago, for 2011/12 the Council produced a 10-year budget together with a four-year savings plan. 

The Portfolio Holder for Finance and Value for Money introduced the report and highlighted that the budget for the next financial year was still in its very early stages.  A significant amount of information from central government was still outstanding and would have to be built into the budget over the coming months.  He also highlighted that there was likely to be a shortfall in meeting the 4 year savings plan but this was still being evaluated.

The Deputy Chief Executive and Director for Corporate Resources outlined a number of issues that could have an impact on the budget process including changes to Council Tax Support and the introduction of Universal Credit.  The latter would have implications for a number of departments across the Council.  Whilst some financial modelling had been undertaken this had proved to be challenging and the implications of the change to Universal Credit had not yet been built into the budget.  Cabinet was reminded that the Services Select Committee had established a Universal Credit Scrutiny Board to review this issue.  In additional to the challenges outlined above, the Deputy Chief Executive and Director of Corporate Resources also highlighted issues surrounding income, future valuations of the Pension fund and future pay settlements.

Members highlighted that that new relaxation of residential planning regulations would have an impact on the budget process as it was highly likely that as a result of the changes the Council would receive less revenue from application fees.

Cabinet considered the budget timetable outlined at Appendix A of the report.  Members noted that there were concerns surrounding the Government timetable for Council Tax Support legislation.  If was likely that some information may be provided late and this would place pressure on the timetable.  Members agreed that the timetable should be presented to the Performance and Governance Committee in order to alert Members to the tight timescales involved.

Resolved: that

(a)   the ten-year financial planning approach and principles set out in this report be endorsed and officers be requested to carry out a further review and provide an update once the government grant settlement has been finalised and a review of the 4-year savings plan has been undertaken and report back to Cabinet on 10 January 2013;

(b)   the budget timetable set out in Appendix A of the report be noted.