Agenda item

To consider the Medium Term Financial Plan (MTFP) update report scheduled for Cabinet consideration on 23 November 2022.

The Committee is asked to scrutinise and comment on the report and if required to make recommendations or observations as appropriate.

Cabinet members invited to attend for this item: Councillor Drew Mellor, Leader of the Council and Portfolio Holder for Finance and Transformation.

The Leader the Council and Portfolio Holder for Finance and Transformation presented a report, a copy of which had been circulated to the Committee and which appear as Appendix A to these minutes in the Minute Book. The Committee was advised that the report presented an update on the workstreams to achieve savings and the initial work around implementation which had highlighted potential consequences for a number of the budget proposals. The Portfolio Holder and Officers responded to a number of issues raised in the subsequent discussion including:

·       The impact of cost of living, inflationary pressures and how this had been affected by the Chancellors autumn budget statement. There was more clarity on expected inflation and the budget was being updated to reflect this.

·       A consultation exercise to determine public priorities and whether this had already started. This had started and was due to run until 23 December 2022.

·       The uncertainties outlined in the report. There was more awareness of these pressures as working through moving through to the balanced budget position. Assumptions were robust.

·       Capitalisation Direction – Councils should have flexibility, pre-2010 Councils were allowed to borrow for transformation purposes. The Leader advised that he had worked through the conditions associated with the ‘minded to’ offer, which were to undertake a governance review and reach a balanced budget position.

·       The external finance and governance review and whether the conditions had been fulfilled. It was noted that there was not yet formal confirmation that the conditions had been met or when this may be received. The Chief Executive advised that he was confident that there would be no issue with receiving this when required. There was concern raised regarding the language used and that statements needed to be as specific as possible.

·       Transformation programme budget figure for officer time and how this was derived. It was noted that it was a percentage of time for people across the organisation working on transformation and a very small team full time.

·       Details of projected transformation savings. There was a high bar before items could be put into the budget but information on savings from procurement had been clear. Procurement savings would come through scale and buying power. There were questions raised on whether these were achievable.

·       Business Rates – It was confirmed that the government announcement would be dealt with by way of a government grant and would therefore not have an impact on the Council. Overaall the rateable values within the area had gone up by an average of 11 percent

·       Asset Disposal – It was noted that there needed to be confidence that assets could be sold within the required timeframe. It was noted that there were multiple options, and the Council was not in a rush to sell. It was confirmed that the figures for the disposals outlined in the paper were a floor and assets would not be sold outside of these figures. There were concerns raised regarding the process outlined for this.

·       Effects of the cost of living crisis – It was noted that BCP was outlier in upper tier authorities in having an in-year surplus. However, there were risks in delivering the transformation programme.

·       It was noted that the change in the external review was because it was considered more streamlined to have a governance review conducted by someone with finance experience to cover all issues within one review. This still need to be confirmed.

·       There was concern on the timetable for bringing forth a balanced budget with the work which would need to proceed on asset sales and completing the consultation. In response to a question the Chief Executive advised that information on auction houses and sales could be obtained.

·       Stakeholder Consultation – whether beach hut owners had been included in this.

·       Issues raised regarding comments from the external auditor regarding the Council’s ability to deliver a balanced budget. There was concern raised regarding the delegation within the recommendation of the report and if this wasn’t approved by Council or if the estimated values were not achieved. he

·       Strategic Assets – The Leader advised that strategic assets were considered sites of notable historic or public interest or of a notable regeneration value and whether this included the Bournemouth indoor bowls club.

The Chairman proposed and the meeting agreed that under Section 100(A)(4) of the Local Government Act 1972, the public be excluded from the meeting for consideration of information within Appendix A to the report on the grounds that it involved the likely disclosure of exempt information relating to the financial or business affairs of any particular person (including the authority holding that information) as defined in Paragraph 3 in Part I of Schedule 12A of the Act and that the public interest in withholding the information outweighs such interest in disclosing the information.’

Voting:  6 in favour 3 abstentions

The meeting moved into exempt session. 

During the exempt part of the meeting the Committee discussed a number of issues concerning the list of potential asset disposals and responses to questions were provided.

Following discussions concerning details within the exempt appendix A the meeting resumed in public session.

The Committee discussed a number of issues concerning the proposed sale of assets and opinions were expressed that the Council should not be selling these assets at this time.

A move was made and seconded that in relation to the proposed sale of non-strategic assets the Committee request that Cabinet approve that the Committee receive the long list of assets and the matrix against they were tested along with the next round of budget papers.

During the debate on this an alternative motion was suggested. The initial motion was withdrawn, and the Committee considered the following motion which was moved and seconded:

RESOVLED: The Corporate and Community Overview and Scrutiny Committee request that the Portfolio Holder and relevant officers bring a report to the next O&S Committee on:

1.     The wider list of assets considered for disposal and the reasons for those selected for shortlist

2.     The timetable for the controlled disposal of public assets, which maximises value and controls risk.

Voting: 6 in favour; 0 against  3 abstention

A further motion was suggested to reflect the concerns that had been raised during the meeting with the recommendation set out at 4 in the report:

RESOLVED: Following exempt discussions concerning Appendix A of the Finance Strategy Update Cabinet report the Corporate and Community Overview and Scrutiny Committee recommend to Cabinet that recommendation 4 as outlined in the report is not approved and that Cabinet gives further consideration to the list of non-strategic Asset Sales as set out in exempt appendix A and that Cabinet give further consideration to all other options.

Voting: 6 in favour, 0 against 3 abstentions.