Agenda item

The Commissioner introduced his report which set out the proposed budget and precept proposals for the Fire and Rescue Authority for 2022/23.

The Panel received a presentation from the Commissioners Chief Finance Officer, which was considered along with the Fire Revenue Budget Report (including the MTFS and Precept).

It was reported that the Settlement Funding for 2022/23 had been confirmed at £13.652million, made up of; Revenue Support Grant (RSG) which had been set at £4.923million; Local Business Rates revenue of £2.670million and Business Top up of £6.059million.  It was noted that the RSG had reduced by £9million since 2012.  The total budget requirement for the service was £42,472million.  The Commissioner was proposing to part fund the balance from Council Tax funding of £28.532 million andproposed an increase of 1.99% per annum (£1.57 pa per Band D property). The Commissioner informed the Panel that this figure was in line with the referendum limit.  Consultation on the proposed budget had resulted in 70% support for the increase.

Referring to Appendix 1 of the report, it was explained that the Pay costs for 2022/23 had increased by £1 million due to an assumption of pay increase of 3%.  It was noted that there were also significant risks and uncertainties beyond 2022/23 which included the impact of national pay awards, implications of the Sargeant/McCloud High Court judgment on pension costs and risks associated with cost increases and the upcoming formula funding review and high levels of inflation.  All of which made future planning a challenge.

The Panel also considered the following documents:

·                The Treasury Management Strategy for 2022/23 which set out proposals for the management of the Fire Authorities cash flows, borrowing and investments and the risks.

·                The Reserves Strategy update paper considered the overall level of reserves held by the Authority at 31 March 2022.  The paper focused on two key areas of reserves that impacted on the future financial strategy.  These were the General Reserve balance forecast as at 31 March was £1.9million and Earmarked (specific) Reserves, to meet future or predicted requirements balance at 31 March 2022 was forecast to be £7.5million. 

·                The Fire Authorities Capital Strategy and Capital Programme 2022/23 to 2024/25 (Including Minimum Revenue Provision Policy).

It was explained that the transformation programme was key in order to deliver savings and that there were a number of areas which were being worked upon, all aligned to the Safety Plan 2020/24 and the Fire Plan 2021-24.  These were:

• Corporate Reform
• Response and crewing reform
• Prevention and Protection reform
• Estates and shared services reform.

Following a question on how the efficiency savings (pay efficiency and non pay efficiency) on appendix 7 would be met (both lines £156,000) and their relationship to the transformation plan savings of £2million, it was reported that the overall £306,000 was split evenly between the two budget heads and would be achieved as a result of the transformation plan.  They were therefore part of the same saving.  The Commissioner felt that the transformation plan savings were achievable but would be challenging.

It was explained that on Appendix One, the PFI unitary charges of £3.003 million were as a result of the service having 21 PFI Fire stations of which there were 2 PFI contracts.  These incurred charges for facility management and lifecycle costs etc.  The Premises costs of £3.897 million were made up of cost on the residual estate; HQ; Joint Emergency Transport and general running costs.

The General Income of £3.3million would be generated through:

• Special Services Grant of £663,000 issued by Central Government to primarily cover the costs of National Insurance increases (this will be be split and carried forward to future years)
• Business Rates S.31 Grants - £1.4m
• General Fees and Charges (see appendix 10) incl. conference facilities
• Police service level agreements for shared premises e.g. Hanley and Tamworth
• There may be potential to increase income  further  through the Commissioner’s joint estates strategy by sharing more buildings. In addition arrangements with the CCU, for example, helping with the vaccination programme and booster programmes and use of buildings.

If savings could not be made or income generated, it was reported that reserves would have to be used in the short term and the Strategy would be reviewed.

The Panel adjourned to consider their response to the Commissioners budget and precept proposals.  Upon reconvening, the Panel unanimously:

RESOLVED:

a.            That the report be noted.

b.            The total 2022/23 net revenue budget requirement of £42.472million including a council tax requirement for 2022/23 of £28.532 million before collection fund surplus/deficits, be noted.

b.            That the proposed budget and Precept increase of 1.99% (£1.57 per annum, per household (Band D)) be supported and the Commissioner be notified accordingly.

c.             That the Council Tax base increase to 355,100 properties, equivalent to an increase of 1.84% and the Council Tax collection fund delivering a surplus of £288,100 and the option to spread the £102,000 per annum deficit attributable to Covid-19 over 3 years (this being the second) be noted.

d.            The MTFS summary financials and MTFS assumptions as detailed in the report, be noted.

e.            That the savings requirement of c£2 million during the MTFS period and the net use of reserves of £0.3m be noted.

f.             That the proposed three-year Capital Investment Programme and the Capital Strategy and Capital Programme Paper be noted.

g.            That the reduction in business rates for 2022/23 following the receipt of NNDR1 returns, including a collection deficit of £0.8million be noted.

h.            That the outcome of the Staffordshire Commissioner’s budget consultation be noted.

i.              That the proposed fees and charges for 2022/23 be noted.

j.                 That the Statement from the Director of Finance / S151 Officer on the robustness of the Budget and adequacy of the proposed financial reserves be noted.