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Budget Book

This page provides information about the Wrexham County Borough Council budget book, which includes revenue spending proposals of each of the services of the County Borough Council for the financial year.

Copies of the detailed budget book are available in your local library.

The following information provides a summary of the current budget:

1. The local authority budget planning process in Wrexham, as elsewhere, requires an early view to be taken about the Council’s budget prospects based on national economic indicators and government planning totals for local authority spending.

2. The budget planning process and timetable for 2017/18 was outlined to members in an information report in April 2016. At an all member budget workshop on 9 June 2016 members were informed of an estimated budget shortfall of around £27m over the next three years of which £7.8m related to the 2017/18 financial year. It was later proposed that no general inflation would be allocated to services thus reducing the shortfall to £5m.

3. Savings proposals were formulated before the summer and a thorough public consultation was undertaken in the autumn. Various processes were used in the consultation including meetings with various groups, an online survey, using social media and a face to face presence in the Monday market. The results of over 1,000 people’s views that were gathered as part of this Difficult Decisions discussion were considered by Members before Christmas. There was general support from the public for all of the savings proposals outlined.

4. The Council’s medium term financial plans have been developed using the following
parameters:

5. The medium term financial plan will be reviewed on a periodic basis.

Review of the Current Year 2016/17

6. The budget for the year was cash limited at £224,068,633.

7. The budget has been closely monitored and controlled during the year in accordance with the procedures approved by Council. A number of service pressures and increased costs were identified early in the financial year and it was agreed that action should be taken by officers to control spending and to keep service spending within the approved cash limited budget totals.

8. All budgets will continue to be carefully scrutinised in accordance with the agreed procedures and the actual outturn will be reported in the summer. In accordance with the rules of cash limited budgeting, any over or underspending may be carried forward to 2017/18.

Welsh Government (WG) Revenue Settlement

9. The grant allocation for individual authorities is dependant on the standard spending assessment (SSA) formula. The most significant changes to the 2017/18 grant allocation was in respect of the formula applied for Personal Social Services (PSS) sparsity measure and the move from 2011 to 2014 based population projections in the settlement calculations. Both these measures had a negative impact on Wrexham’s share of the total allocation.

10. The WG announced its final revenue settlement details for local authorities on 21 December 2016. The settlement gave local authorities in Wales on average a 0.2% grant increase (after taking into account of transfers of grants) although Wrexham’s share was a decrease of 0.5%.

11. The Local Government Finance Act 1992 gives the Cabinet Secretary for Finance and Local Government, power to limit or cap the budget requirement of any local authority, which he considers to be excessive. No announcement has been made relating to assumptions about the Council’s spending level for 2017/18. The Council’s standard spending assessment, the notional assessment for grant distribution purposes of the Council’s need to spend on its services, totalled £230,510,101.

2017/18 Budget

12. The budget for next year as outlined in Page (vi) has been built up in accordance with the framework agreed by Council. The budget in the current year (i.e. the cash limited budget amended for the transfers of grants into the Revenue Support grant) has been adjusted for the cost of inflation, unavoidable commitments and savings.

13. The total net revenue expenditure is estimated at £225,323,754.

14. It is a requirement of the Local Government Act 2003 that I should report to members on the robustness of the estimates made for the purpose of calculating the net budget requirement. I should therefore draw your attention to a number of key risk areas that I have identified in the budget and how these may be managed. These are outlined in Page 11. Issues relating to these key risks will be reported to members during the forthcoming year as necessary as part of the budget monitoring and control procedures.

Reserves and Balances

15. A local authority requires a prudent level of working balances to maintain adequate cash flow, especially during the first part of the financial year prior to the receipt of council tax income, and to meet unforeseen expenditure.

16. There are no planned contributions to balances for 2017/18. However, I am satisfied that the level of balances and reserves is adequate for the forthcoming financial year and the authority’s medium term financial strategy.

17. There is still uncertainty on the impact of pay and other inflation costs and the reduction in specific grants on the Council’s budget.

18. An analysis of the Council’s key estimated earmarked reserves and balances for the year ahead is as follows:

Fund Actual Balance at 1 April 2016 £k Estimated Balance at 1 April 2017 £k Movement in Year £k Estimated Balance at 31 March 2018 £k
Council Fund Balance 7,018 7,018 0 7,018
School Balances 2,580 525 0 525
Service Reserves 710 456 (303) 153
Other Earmarked Reserves
(excluding grant reserves)
13,152 7,709 (3,435) 4,274
Total Balances and Reserves 23,460 15,708 (3,738) 11,970

19. The estimated balances at 1 April 2017 in the table above are based on the best estimates available at the time of writing the report. The movement in the Council Fund balance includes the reported position in the current year. The reported position will change following the closure of the 2016-17 accounts and will be reported to members after the end of the financial year. Of the 2017/18 in year planned movement on service reserves of £303k none will be used to fund recurrent expenditure.

20. In accordance with the Council’s Reserve Strategy, Other Earmarked reserves will be reviewed to ensure they continue to be held according to an agreed plan or returned to the Council Fund balance for more appropriate allocation.

Income

WG Grant Funding

21. Revenue Support Grant – The County Borough’s share of the final Revenue Support Grant has been set at £125,819,223.

22. Business Rates – the business rate poundage for 2017/18 has been set at 49.9p in the £. The County Borough’s share of national non-domestic rate income in 2017/18 is £43,627,561.

23. In total the Council will receive general grants from WG of £169,446,784.

Council Tax

24. After taking account of the general grants and contribution from balances, the balance of net expenditure totalling £55,876,970 remains to be funded by council taxpayers.

25. It is proposed to charge as a special expense part of the cost of footway lighting to the four community areas within the town (£4.66 at band D), the community of Llangollen Rural (£15.48 at band D), Chirk (£10.07 at band D) and Glyntraian (£11.90 at band D).

26. After adjusting for special expenses of £111,177 the balance to be found as general expenses from council taxpayers is £55,765,793.

27. The council tax base calculation for 2017/18, is 53,116 band D equivalent properties after allowing for:

The overall tax base is built up from the same calculations for each of the 34 community areas and the “band D equivalents” are shown in Page (vii).

28. Dividing the balance of net expenditure (£55,765,793) by the tax base of 53,116 will give a £1,049.89 charge to be borne by a full-paying household whose home is valued at band D. For band A property the charge is six ninths of this figure through to band I properties where the charge is twenty one ninths of the band D figure. In many cases these figures will be adjusted for disabled and other discounts and, of course, for council tax benefit.

29. Page (vii) sets out the council tax rate for the band D taxpayer for each community council area and shows that when the police authority’s precept is included, the total average council tax at band D for 2017/18 is £1,346.05.

CONCLUSION

30. Although there has been a reduction in the financial settlement for 2017/18 every effort has been made to prioritise schools and the most vulnerable.

31. The Local Government Act 2003 requires the Council to monitor its budget and to take appropriate action. The budget will therefore require close monitoring and control during the year and the financial position will need to be kept continuously under
review.

32. Finally, I remain very grateful to all Members and Officers for their assistance, cooperation and hard work in helping to prepare this budget.

M S Owen
Head of Finance Department