1. Purpose of document
The purpose of this document is to explain to partner organisations how the Council agrees its annual budget, which determines the level of Council Tax. The whole Council is required to take a decision on the budget and Council Tax. This happens in February every year for the succeeding financial year that starts on 1st April and finishes the following 31st March.
The Council's Fit For The Future Programme, with its other underpinning strategies drive the officer recommendations on the budget to Members.
In practice it is the Executive Committee of the Council that decides what to include and exclude at the annual budget setting; balancing this to the desired level of Council Tax. The Executive recommends the budget proposals to the full Council. However, the process starts much earlier in the previous financial year with the service planning process. (See 2 and 3 below).
2. The Council's Fit For The Future Programme
The Council has elections once every four years. The last election was in May 2011. In accordance with normal practice, whoever forms the new administration after the elections will determine the Strategy and plans for the four year term. The overarching Sustainable Community Strategy determines the Council's Fit For The Future Programme, with Portfolio Holder Statements produced annually reflecting the elements specific to that portfolio. Alongside which the Council has Resources Startegies (Finance, ICT, Assets and People) to deliver such. The necessary Resources are assessed annually and built into the Service Planning process during the previous Autumn to inform the Budget Planning Process.
3. The service planning process
The Head of Services prepares a service plan in consultation with their portfolio holder. Within the plan are proposals for development of the service in line with the Fit For The Future Programme and any changes resulting from legislation, as well as potential savings. Proposed developments have to be costed and demonstrate how any additional resources will improve performance, particularly in relation to the Fit for the Future Programme. In recent years due to the Council's Financial Constraints, the Service Planning Process has been driven by the need to achieve significant savings without compromising front line services.
It would be expected that any bids for additional resources, even if they are to fund external organisations for services would need to be supported by the relevant head of service Portfolio Holder and included in their service plan. As in the case of other bids they would need to demonstrate how they would further the key targets.
The Council actively looks to work with other partner organisations with aims and objectives akin to their own, especially where joint working can realise savings and value for money for both partners.
The service plan budget proposals are discussed with the relevant portfolio holder, in advance of consideration by the Council's Senior Management Team.
During the process the Council will consult with various bodies, such as Town Councils, Chamber of Commerce. The Council is moving towards undertaking a major consultation process with its residents every four years, this plus bi-annual residents surveys will inform future priorities and options, as well as those being considered during the annual budget cycle.
In February the Executive agrees on a final package of service changes and the consequent level of Council Tax which it recommends to the Council.
4. Resources available for growth and Council Tax capping
Council prepares financial plans for 4-5 years ahead. These had previously assumed that Council Tax increases will be in the order of 2.5%. In the current economic climate the Council endeavoured to freeze the Council Tax for 2011-12. However even a 2.5% increase will only raise approximately £200,000. The Council's net budget is about £18,000,000. The Council receives just under £8 million of Government Grant. In the current financial climate, the Council, as with most of the public sector, is experiencing major reductions in central government grant in future years. With significant reductions over the three years from 2011/12 being factored into the Council's projections at present pending more definitive details. Taking into account other pressures on the Council, around £3 million needs to be saved in future years. The Council has many initiatives actively being undertaken aimed at reducing costs whilst improving services within it's Fit For The Future Programme and actively explores other areas where spending can be reduced or income generated. Hence the room for additional expenditure on things the Council would like to do becomes very limited.
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