Agenda item

The Cabinet considered an urgent report of the Director of Corporate Resources concerning the serious financial position faced by the County Council. A copy of the report, marked ‘Agenda Item 11’, is filed with these minutes.

The Director said that whilst setting the Council’s budgets in the previous 10 years had been tough, next year’s would be the hardest to date, mainly due to the steep rise in inflation which was predicted to peak at 11% later in the year and could possibly rise further. The projected financial gap by the end of the current MTFS was anticipated to be over £70m despite having identified £54m worth of savings.

The Leader said that the financial position faced by the County Council was daunting and he proposed some revisions to the proposed recommendations to emphasise the frightening position the Council faced. He requested that officers consider the savings which could be achieved if a moratorium on all non-essential capital expenditure was implemented. He added the Council would need to make some tough decisions later in the year in order to balance its budget.

Mr Breckon CC said that since the Council had set its budget in February, inflation had continued to rise and the impact on the Authority had been significant. Whilst the Council would be able with tough decisions to prepare a balanced budget for 2022/23, the years after would be tough, with the gap expected to rise from £8m to £20m for 2023/24. He added that it was essential the Council was proactive, undertaking work as soon as possible to identify further savings proposals from across all departments. In addition, the capital programme would have to be reviewed, with the possibility of some existing schemes either being cancelled or reduced in scope. He added that the County Council would continue to lobby Government for fairer funding.

Mrs Taylor CC said that it was now more vital than ever that the County Council received an increase in its funding from Government. She reassured residents that the Authority would do all it could to continue to provide essential services and support the most vulnerable within the County.

Mr Bedford CC said that it was right for the Council to take swift action in order to avoid a much worse position in future years. He added that local MPs had a crucial role in lobbying the Government for fairer funding.

Mrs Radford CC said that the Council would continue to do everything it could to support elderly and vulnerable residents.

Mr O’Shea CC said that the County Council had been underfunded for too long to the detriment of its residents who relied on the Authority to deliver important services. He urged local MPs to support the Council in the securing of fairer funding.

RESOLVED:

a)    That the very challenging, worsening and frightening financial position faced by the County Council be noted with concern;

b)    That Chief Officers be authorised to undertake urgent preparatory work on savings that are not currently in the MTFS following consultation with the appropriate Lead Member, the Director of Corporate Resources and Lead Member for Resources, with the outcome being considered as part of the roll forward of the MTFS and presented to the Cabinet at its meeting September;

c)     That the Director of Corporate Resources, following consultation with the appropriate Lead Member and Chief Officer and Lead Member for Resources, be authorised to commence preparatory work reviewing capital schemes, with a view to reducing cost and to consider a moratorium on all non-essential capital expenditure;

d)    That the report be shared with Leicestershire’s Members of Parliament to assist in their understanding of the increasingly serious situation and to support them in their lobbying of Government.

REASON FOR DECISION:

To inform the Cabinet of the work that needs to be undertaken to ensure a balanced budget can be set in 2023/24.