Issue - meetings

To submit a report by the Head of Function (Resources)/Section 151 Officer.

It was resolved to note the contents of the Medium Term Financial Plan 2019/20 – 2021/22 and to approve the assumptions made therein.

The report of the Head of Function (Resources)/Section 151 Officer incorporating the Medium Term Financial Plan (MTFP) for 2019/20 to 2021/22 was presented for the Executive’s consideration. The plan outlines the Council’s budget strategy over the next three year period and sets out the assumptions which will be taken forward to the annual budget setting process.

The Portfolio Member for Finance reported that the Council is required to put in place a robust system to monitor and control its revenue budget with the Medium Term Financial Plan being a key element of that system. He said that the Council will have to make difficult decisions over the next three years with no prospect of a let-up in the funding cuts which local authorities in Wales have experienced over the past few years. The introduction of the austerity programme by the Westminster Government has resulted in reductions in the funding passed onto the Welsh Government and this in turn has affected the level of funding which councils in Wales receive with year on year cuts to council budgets. But although local authority funding levels have continued to decline the Council still has to deliver services to the people of Anglesey - those include services for vulnerable people and services which by law it must provide.

The Portfolio Member referred to Table 2 in the report which provides an analysis of the savings made per service over the three year period form 2013/14 to 2018/19 compared to the net revenue Budget for 2018/19. The Council has made savings to the value of £21.748m in this period and whilst it has sought to provide some level of protection to schools, Adults’ Services and Children’s Services, other frontline services – Leisure, Maritime, Economic Development, Housing, Highways, Waste and Property in particular – have borne the brunt of the savings and have provided the greatest proportion of savings in relation to their net budget.

The Portfolio Member said that the Medium Term Financial Plan describes how the Council proposes to deal with the financial challenges it faces in the coming three years whilst at the same time balancing its budget and continuing to deliver services and fulfil its statutory responsibilities. He commended the Plan to the Executive.

The Head of Function (Resources)/Section 151 Officer said that the MTFP set the financial context in which the Council will have to operate for the next three year period. The current situation is not encouraging with the Council, based on Quarter 1 data forecasted to overspend its budget by £1.744m at the end of the 2018/19 financial year. Alternatively, it could be said that budgets are underfunded and have failed to keep up with demand.

Notwithstanding, the underlying causes of service overspends have to be tackled otherwise the Authority’s reserves will be further depleted potentially taking them from where they currently stand at just above the minimum reserves threshold of £6.5m agreed by the Council down to below the £5m level. This is unacceptable and poses a risk  ...  view the full minutes text for item 6