Council received and considered a report, presented by the Mayor, which set out the recommended 2015/2016 Revenue Budget.
The proposed budget had been subject to consultation with stakeholders and took into account 51 budget proposals announced to Council on 22 October 2014 and a subsequent amendment presented to Council on 10 December 2014.
In recent months the Mayor had made five specific statements to Council about the financial situation and the main themes were to protect children and young people, the elderly and other vulnerable people, whilst maintaining services by performing differently and ensuring they were fit for purpose as well as contributing to economic growth.
The draft Local Government Finance Report for 2015/2016 was released on 18 December 2014 and an increase of £351,000 had been provided from that proposed draft settlement. The Local Authority would receive a reduction of £13.4 million in Revenue Grant from the Government, which equated to a reduction of 14.9% in comparison with the previous year. The position was broadly in line with the current Medium Term Financial Plan projections.
The Mayor explained that in order to balance the budget, savings of £14.1 million would be required. Details of those savings were shown at Appendix A to the submitted report.
The proposed budget requirement was £119,917,000, detailed at Appendix B to the submitted report, included investment of £4.6 million in key services which included: £2.175 million for care for children and young people, £1.533 million for care for older people and vulnerable adults, £0.400 million capital investment and £0.470 million for the introduction of the living wage.
It was highlighted that currently 53% of the Council Budget was spent on looking after children and young people, the elderly and other vulnerable people and it was inevitable that these pressures would increase by 2020, when it was estimated that 73% of the budget would be spent on these areas.
The impact of the Government's proposed Freeze Grant had been carefully considered. If accepted there would be an additional requirement for a further budget reduction of £400,000 in 2015/2016 and an overall additional gap shortfall of £17 million over the next ten years. The Mayor stated that the Council Tax Freeze Grant should be rejected and the Council Tax should rise by 1.85%, which equated to an increase of 32p per week for a Band B property, excluding the parish precepts. Details of the Council Tax for each category of dwelling were included at Appendix E to the submitted report.
The Chair of the Overview and Scrutiny Board provided comments from the Board's consideration of the draft Budget.
Consideration was given to an amendment proposed by Councillor Junier and seconded by Councillor Loughborough, that the Council should freeze the Council Tax for one year and consider other proposals on spending money from the budget and pull back.
On a vote being taken, the motion was declared LOST.
Several Members commented on the Council Tax Freeze Grant and the introduction of the Living Wage. Concerns were expressed in relation to the threat to front line services, past Council expenditure and the financial pressures on Middlesbrough residents.
The Mayor responded and concluded by summarising his concerns for the future requirements in relation to increasing services for children, young people, the elderly and other vulnerable people.
In accordance with statutory regulations a recorded vote was taken by roll call of those Members present at that time, the results of which were as follows:-
Votes for (25):
The Mayor, Councillor Kerr (Chair), Councillors Biswas, Bloundele, Brunton, Budd, Carr, Clark, Cole, Davison, Dryden, Harvey, Hussain, Lowes, McIntyre, G Purvis, P Purvis, Rooney, Rostron, J Sharrocks, P Sharrocks, Taylor, M Thompson, J A Walker and N J Walker.
Votes against (15):
Councillors Arundale, Cox, Hawthorne, C Hobson, J Hobson, Hubbard, Hudson, Junier, P Khan, S Khan, Loughborough, McPartland, Mrs H Pearson, OBE, Sanderson and Saunders.
Abstained from Voting (0).
ORDERED as follows that:
1. the budget reductions outlined at Appendix A to the submitted report be approved.
2. the budget requirement for 2015/2016 was set at £119,917,000 as detailed in Appendix B to the report submitted.
3. having taken into account relevant matters set out in the submitted report, the basic amount of Council Tax (Band D) for 2015/2016 be increased by 1.85% to £1,380.56 being the average (Band D) Council Tax for the whole of the Borough.
4. the basic amount of Council Tax in areas with parish precepts be set at £1,383.79 in respect of Nunthorpe Parish and £1,391.17 in respect of Stainton and Thornton Parish.
5. the amounts of Council Tax for each category of dwelling be set in accordance with table 4 of Appendix E of the report submitted.
6. the Prudential Indicators, Treasury Management and Investment Strategy and Minimum Revenue Provision Policy as set out in Appendix F be approved.
7. Members noted the additional level of £4.6 million investment in key services.