Purpose

A report by the Cabinet Member for Finance and
Change providing an update on the Medium Term Financial
Strategy

Decision

General Fund – Revenue
It is recommended that Cabinet:
i) 
Notes the updated budget position, progress made on the financial
strategy and MTFS forecast.
ii) 
Approves the creation of a Transformation Reserve and an
Organisational Redesign Reserve as set out in paragraphs 50 to
54.
iii) 
Approves the creation of an Investment Risk Reserve as set out in
paragraphs 55 to 58.
iv) 
Approves the reintroduction of the Social Care Demand Risk Reserve
as set out in paragraph 59 to 62.
 
Housing Revenue Account
It is recommended that Cabinet:
v) 
Notes the update on the Housing Revenue Account business plan
proposals set out in paragraphs 90 to 99 and Appendix 6.
vi) 
Approves the in-year budget adjustments to the Housing Revenue
Account capital programme detailed in paragraphs 82 to 89.
 
Capital Programme
It is recommended that Cabinet:
vii) 
Notes the progress on reviewing the General Fund capital programme
set out in paragraphs 70 to 72.
viii) 
Notes the in-year budget adjustments to the General Fund capital
programme, as summarised in paragraph 72 and detailed in Appendix
5.
 
 

Reasons for the decision

1. 
The medium term financial strategy is a dynamic plan which requires
regular review and update to ensure the council has clear oversight
of its medium term financial position, therefore it is best
practice to bring updates revising the assumptions and progress on
the plan. 
2. 
There is also a need to bring forward proposals to help address the
budget shortfall identified for future years.
3. 
There is also a further update on the work that has been undertaken
by the Chartered Institute of Public Finance and Accountancy
(CIPFA) on the financial position of the council, following the
review of the robustness of forecasts.

Alternative options considered

An approach of failing to take actions in-year
and implement the new Financial Strategy agreed in July by full
council would lead to a large forecast overspend which would mean
the council being financially unsustainable and the issuing of a
S114 notice.  The council is also
legally obliged to set a balanced budget for 2024/25, and the work
reported below includes measures to help with that requirement.