Agenda item

Purpose: the Council is pro-actively responding to the financial position that it, and many other Councils across the country, faces. The report sets out the Finance Improvement Plan, the external assurance review and implementation of a Finance Improvement Group to provide even greater focus on the Council’s finances.

Resolved that:

·       To inform the members that the Council is responding to the CIPFA resilience review.

·       For the Executive to approve the Financial Improvement Plan and associated Financial Improvement Group.

This decision is not subject to call in as:

·     a delay in implementing the decision this would cause the Council serious financial implications or could compromise the Council's position.

therefore it will be implemented immediately.

Councillor Iain Cottingham introduced and proposed a report (Agenda Item 7) which requested approval of the Financial Improvement Plan and associated Financial Improvement Group which had been developed to provide an overarching approach, with supporting themes, to address the Council's financial position and reliance upon Exceptional Financial Support (EFS).

Councillor Cottingham highlighted the inclusion of an organisational chart (page 50 of the agenda pack) which detailed the reporting lines and the proposed Financial Improvement Group’s interaction with the Financial Review Panel, Spend Panel, and other governance boards. He stated that the council would leverage external expertise, including two independent non-executive members, to provide insight and improve processes.

Councillor Ross Mackinnon referred to the independent Chartered Institute of Public Finance and Accountancy (CIPFA) report and queried why it had been commissioned and whether the administration accepted its conclusions.

Joseph Holmes, the Chief Executive responded that the external review was commissioned to provide an unbiased assessment, as required when seeking extraordinary financial support, and that CIPFA was the leader in such reviews for local authorities.

Councillor Mackinnon queried whether the administration accepted specific conclusions from the CIPFA report, including statements about the council’s perilous financial position; a perception within the Council that the application for EFS obviated the need to address the structural gap; that existing savings plans were short term; and the relationship between Members and officers were blurred. Councillors Jeff Brooks and Cottingham responded that whilst they respected the report, they did not agree with any of those conclusions and explained that some of the report’s findings were based on information available at the time, which had since changed.

Councillor Mackinnon referred to and queried the Draft Delivery Plan’s timescales which referenced Quarter Three the following year. Councillor Cottingham stated that the plan’s completion dates were initial proposals subject to review by the Financial Improvement Group.

Councillor Mackinnon commented that as so many of the CIPFA findings had either been rejected or obfuscated, that the Executive’s response was a ‘disgrace’ and he suggested the Executive should resign.

Councillor Brooksrebutted the comment and suggested that the previous administration's overspends and depletion of reserves, were responsible for the current problems.

Councillor Adrian Abbs queried about the risk of the Council needing to hold a referendum to increase council tax above the statutory maximum. Councillor Cottingham confirmed that the administration would not pursue a referendum and highlighted the negative impact of the government’s recent funding formula on the Council’s finances.

Councillor David Marsh agreed with concerns raised about the impact of the funding formula and the pressures on council services, but queried the role of transformation in the improvement plan, the reporting arrangements for the new group, and whether the constitution would be updated to reflect creation of the Financial Improvement Group. Councillor Cottingham responded that transformation was embedded across the organisation and that regular reporting of the Financial Improvement Group to the Executive and Scrutiny would be undertaken.

Councillor Jeff Brooks seconded the recommendations within the report, noting that councils throughout the country were facing unprecedented levels of demand and financial pressure , and that the Council’s funding outcome had compounded the situation.

RESOLVED that:

·         To inform the members that the Council is responding to the CIPFA resilience review.

·         For the Executive to approve the Financial Improvement Plan and associated Financial Improvement Group.