Agenda item

Medium Term Financial Plan 2021/22 to 2024/25 and Revenue and Capital Budget 2021/22 - Report of Interim Corporate Director of Resources [Key Decision: CORP/R/20/02]


The Cabinet considered a report of the Interim Corporate Director of Resources which provided comprehensive financial information to enable Cabinet to agree the 2021/22 balanced revenue budget, details of significant investments in key front line services, an outline Medium Term Financial Plan MTFP(11) 2021/22 to 2024/25 and a fully funded capital programme (for copy see file of minutes).


Councillor Shuttleworth spoke of previous cost estimates for the removal of asbestos and demolition of County Hall and the cost of the demolition of the former highways laboratory, and, referring to the capital programme for 2022/23 he asked if the £500,000 demolition costs for County Hall included the removal of asbestos.


Councillor Napier, Deputy Leader and Portfolio Holder for Finance, thanked Cllr Shuttleworth for his question.  He responded that the original outline business case for the new HQ, demonstrated that remaining on the Aykley Heads site and investing in improving County Hall to meet modern requirements was the most expensive option, with an estimated capital cost of £76.5 million and would also have inhibited the ability to open up the site as a strategic employment site.  He confirmed that the £500,000 included in the capital budget for 2022/23 is not the full demolition budget and it covers the initial preparatory work required for the demolition of County Hall only. There will be an additional budget provision required in 2023/24, which will be considered as part of MTFP12 and next year’s budget report.  The total estimated budget provision required for the demolition of County Hall, including the removal of asbestos, is approximately £5 million.


Moving the report, Councillor Napier commended officers for the comprehensive report, noting the Interim Corporate Director of Resources comments that the report had been prepared against a backdrop of uncertainty as the Council awaits the publication of the comprehensive spending review and the impact of the fair funding review.


He pointed out that the Council has endeavoured to continue to support those most vulnerable, despite austerity and the more recent challenges caused by the pandemic.  By the end of the MTFP planning period forecast cuts are estimated at approximately £290 million with the loss of approximately 3,000 posts.  He added the decision to protect front line services, together with strong financial management has enabled the Council to rise to these challenges despite disproportionate cuts and he raised concern as to how the government will seek to redress public finances in the future, fearing further funding cuts to local government, with the greatest burden falling on local authorities such as Durham.


Councillor Napier stated that government figures show the core spending power per dwelling for Durham County Council is below the national average.  Durham is the 48th most deprived local authority area in the county out of the 151 upper tier authorities.  He commented that Durham should be funded above the national average, which would provide £45 million of additional funding.


He highlighted that the finances have been managed prudently and efficiently, which was testament to all officers of the Council and he  commended the proposals within the report, adding that it is vital that Cabinet and Council are mindful of the uncertainty that exists beyond the next financial year, when making budget decisions.


The Chair referred to proposals for continued growth in front line services, additional investment in priority areas and help for those most in need.  He commented on the capital programme which continues to grow and he added that he was pleased to see the additional £5 million to the Towns and Villages Investment Plan, with residents in Area Action Partnerships involved in decision making on how to spend their budgets.  He spoke of the outstanding model of local decision making the Area Action Partnerships had been over the past decade.  He thanked all those who had been involved throughout this time, saying he was looking forward to their work continuing.


He remarked that the proposed lower than expected council tax increase reflects the robust state of the Council’s finances, despite the challenges.  He commented that the fact that the Council is not one of those in financial difficulty is due to the efforts of all staff and he paid tribute to Councillor Napier for all his work over the past decade which has ensured the Council is in a strong financial position for the future.


Councillor Gunn, Portfolio Holder for Children and Young People’s Services, thanked the Portfolio Holder for Finance, the former Corporate Director of Resources and the Interim Corporate Director of Resources for their outstanding work to balance the budget and praised the extremely effective financial management which had taken place over ten years of relentless budget cuts. 




Upon a recorded vote being taken Cabinet unanimously agreed to recommend to full Council, approval of the recommendations set out in the report.


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