Agenda item

The Leader of the Council presented the report, asking Council to agree the Council’s council tax increase for 2019/20 and resulting total net revenue budget as recommended by Cabinet on 13 February 2019.

In presenting the report, the Leader highlighted the context within which the budget proposals had been developed.  The Council carried out more than 800 activities and services, which were important to all people in the city, in particular those most vulnerable and in need of support.  Demand for these services had increased significantly over the last few years, a UK-wide trend which was affecting all Councils.  As well as meeting the increasing needs of residents, the Council was also ambitious in its aspirations for the city, and how we can “improve people’s lives”.  The new corporate plan set out the key priorities for development within a continuing challenging financial environment.

The budget included:

-       Continued investment in services, over and above inflation, which support the most vulnerable residents:

o   In special education provision at £1.7m

o   Social care at £3.9

o   Schools at £3.6m for the next year, on top of around £10m over the last five years.

-       Supporting progress against the corporate plan priorities and investment in key projects:

o   Regeneration – the market arcade and indoor market developments, building on the success of Friar’s Walk

o   Recycling –to increase the city’s recycling and move to having a further household recycling site in the city.

o   Heritage – securing major investment in the city’s Transporter Bridge.

o   School’s - £70m in the Council’s Band B programme.  

In introducing the proposed Council Tax level, the Leader highlighted:

-       The significant budget challenge faced by the Council.  The total increase in the Council’s revenue support grant for 2019/20 was not sufficient to cover the demand for services.  Even after allowing for £2m of one-off grants and an increase in our tax base, which helped fund some of the investments, the gap in next year’s budget was about £10.5m.

-       The budget had not been balanced by an increase in Council Tax alone, but a combination of this and savings made.  Cabinet felt this was a “fair balance”, taking everything  into account and protecting services from further changes and cuts.

-       Consultation on the budget showed that people understood the challenge faced and supported this level of increase in the Council Tax. 

-       A number of changes had been made to the initial proposals following the budget consultation process, including a decrease to the proposed Council Tax increase, reducing proposed savings in education services, and delaying increases to resident parking permits.

-       The increase would still result in one of the lowest Council Tax rates in Wales and the UK, equating to increased amounts of 94p, £1.08 and £1.21 per week for a Band B,C and D dwelling

-       The Council would continue to spend well below its Standard Spending Assessment.

The report also detailed the Council’s medium term financial projections, showing a continuing challenging outlook.  The Council Tax resolution, which included the Gwent Police and Crime Commissioner and Community Councils precept requirements, were also included in the papers.

The Leader concluded by recommending the Council Tax levels required to underpin the budget, to protect much needed services, to further invest in those services, to deliver on aspirations for the city and its residents, and continuing to provide good value for money.

The following points were made in favour of the report:

-       The impact of austerity on the Council’s financial position.

-       The unfairness of the Barnett formula in distributing funding to Welsh authorities.

-       The extensive consultation process, including the public and specific consultees such as the Scrutiny Committees and the Fairness Commission.

-       The absence of alternative proposals being put forward.

The following points were made against the report:

-       The impact of Welsh Government with regard to funding distribution.

-       The impact of historical decisions not to increase Council Tax.

-       Counter arguments regarding the impact of austerity on the Council’s finances.

-       Examples of alternative proposals previously put forward to make budgetary savings.

-       The need to take into account precepts in the overall cost of Council tax.

-       The impact of the decision to change Community Council funding.

The required number of elected members sought a recorded vote.

The following members voted in favour of the proposals:

Councillors Al-Nuaimi; Berry; Clarke; Cockeram; Critchley; Davies; Forsey; Giles; Guy; Harvey; R Hayat; Holyoake; Hourahine; Hughes; Jeavons; Jenkins; Lacey; Linton; Marshall; Mayer; Morris; Mudd; Rahman; Richards; H Thomas; K Thomas; Truman; T Watkins; Whitcutt; and Wilcox. A total of 30 votes.

There were no votes against the proposals.

The following members abstained:

Councillors Cleverly; Cornelious; Dudley; C Evans; M Evans; C Ferris; Fouweather; Jordan; Kellaway; Routley; Suller; C Townsend; H Townsend; J Watkins; White; and Williams.  A total of 16 absentions.

It was therefore

Resolved

Revenue budget and council tax 19/20(section 2-8)

1          To note that an extensive consultation exercise has been completed on the medium term change/ savings programme, including the 2019/20 budget proposals.  Cabinet have taken these into account in recommending final details of their budget

2          To note the Head of Finance’s recommendations that minimum general reserve balances be maintained at £6.5million, the confirmation of the robustness of the overall budget underlying the proposals, subject to the key issues highlighted in section 5, and the adequacy of the general reserves in the context of other earmarked reserves and a general revenue budget contingency of c£1.5million

3          To consider and approve a council tax increase for Newport City Council of 5.95%, a Band D tax of £1,120.04; and resulting overall revenue budget shown in appendix 1

4          To approve the formal council tax resolution, included in appendix 3 which incorporates The Police and Crime Commissioner for Gwent and Community Council precepts

Medium term financial projections (section 5)

5          To note the MTFP and the challenging financial climate over the medium term

6          To note Cabinets approval of theimplementation of the full four-year change programme, including all budget investments and saving options, as summarised within the medium term financial projections (appendix 4).  Noting they are subject to on-going review and updating