Councillor Bingley (Leader) introduced the Draft Budget Report 2023 – 24 and highlighted the following points –         

(a)   The report sets out a draft budget for 2023/24 and a proposed Council Tax rate;

(b)  The scale of the task in getting to the stage where we can recommend a draft budget should not be underestimated given the unprecedented challenges this year which were being faced by all local authorities – not least national inflation running at around 10 per cent, rising energy costs and increasing demand pressures and rising costs in social care services;

(c)   in the summer these factors led to us identifying a projected overspend of £15.5 million for this financial year and a £37.6 million shortfall in the resources  needed to set a balanced budget for 2023/24;

(d)  Since then we had been working hard on a budget recovery programme to address these pressures, focusing on modernising and?investing, generating?income, reviewing the efficiency and effectiveness of everything we do and making difficult decisions to change, pause or stop services or activities – while protecting the statutory services that we provide;

(e)  We are committed to listening to Plymouth residents as we did this and before Christmas we held a public engagement exercise to seek views on proposed measures to help close the shortfall;

(f)    pleased to say that we had around 300 responses, many of them very thoughtful and constructive;

(g)   A summary of the feedback is set out in this report;

(h)  Considered all feedback that we had received as we make decisions on the budget. I would like to thank everyone who took the time to give their feedback;

(i)    The report before us today shows progress in closing the budget gap through savings and other measures totalling £25.8 million;

(j)    This report recommended that – like most other local authorities across the country – we increase Council Tax by 2.99%, as well as levy a 2% precept to support the increase in costs and demand for looking after the elderly and social care for both adults and children;

(k)  Plymouth households are also facing rising bills and the impact of the cost of living crisis, so do not take the decision to recommend any increase lightly. However, we need to protect statutory services and protect the elderly and vulnerable in Plymouth;

(l)    We also need to remind ourselves that the increase is limited to 2.99 per cent, which compares to the inflation rate of around 10 per cent;

(m)even with the proposed increase, we still have a gap to close before the Full Council meeting on 27 February, so work needs to continue;

(n)  We remain determined to deliver a budget that gets us through this extremely difficult financial situation and enables us to emerge as a leaner and greener council that?is even more effective and efficient;

(o)  Thanked everyone involved in getting us to the stage today where we can recommend a draft budget. It was the result of a huge amount of hard work by members, officers across the council and our finance team over the last six months. We are not there yet but together we have achieved a massive amount;

Councillor Shayer (Deputy Leader and Cabinet Member for Finance and Economy) highlighted the following key points -

(a)   The Council continued to manage a challenging financial environment where service demands continue to increase, the longer-term legacy impact of COVID-19 continues and where uncertain and unpredictable funding and cost levels remain;

(b)  Together with all authorities the Council was in a serious and unprecedented position due to additional national and international factors largely beyond its control, including rapidly rising energy costs, broader inflation related cost increases and demand pressures and costs in both adults’ and children’s social care;

(c)   The report set out an update to the Draft Budget which was presented to Cabinet in November last year;

(d)  At that time, we were presented with a budget gap to close of £11.394m. We are now showing a revised gap of £617,000;

(e)  there are several key areas to think about not least that to get to this position we all need to work together to ensure we deliver in full the £26m of savings as set out. We would of course consider the views from the public engagement and the budget scrutiny committee next week. But we need to meet this savings target;

(f)    the report is proposed a 2.99% increase in the Council Tax and a further 2% increase for the Adult Social Care Precept. These two measures together provided additional resources of £6.240m – not just for 2023/24 but also for future years as part of our core income;

(g)   It goes without saying, that without this increase we would be looking at a financial gap of £6.857m next year;

(h)  reminded us that the Council delivers more than 300 services – as diverse as bin collections, protecting vulnerable children, providing libraries, making planning decisions, attracting investment and jobs in the city, providing leisure facilities, providing parking, maintaining roads and pavements and looking after Plymouth’s parks and green spaces;

(i)    Every part of the Council had been involved in the response to the budget situation and many employees and services would need to work in new ways. A significant amount of work continued to support the city’s economy, which had been severely affected by the recent pandemic and cost of living crisis: high value jobs remained a priority. It should be noted that options were limited by the fact that the Council needed to deliver a large number of services as a statutory requirement and has limited scope to influence how these services are delivered;

Cabinet agreed to -

1.    Note this report, and that it is subject to change in line with any final Settlement adjustments.

2.    Agree to recommend and endorse to Full Council on the 27 February 2023 the approval of a Council Tax rise of 2.99% and ASC Precept rise of 2.00%.

3.    Delegate authority to the Section 151 Officer, in consultation with the Deputy Leader and Cabinet Member for Finance and Economy, to propose final adjustments to achieve a balanced Revenue Budget.

4.    Note a final Revenue and Capital Budget 2023/24 will be presented to the Cabinet meeting 9 February 2023, to be presented to February Full Council.