Minutes:
The Committee was reminded that, at its meeting on 9th January, it had been advised that a District Rate increase of approximately 8.59% for 2009/10 would be required to meet the Council’s Estimated Expenditure. The Committee had agreed that further work on the Estimates of Expenditure for the 2009/10 financial year was necessary and directed that:
(i) the Chief Executive and the Director of Corporate Services examine the overall Council estimates and discuss with Department Heads the need to identify further cost savings with a view to submitting a report to the next meeting of the Committee scheduled to be held on 23rd January;
(ii) briefings be held for each of the Party Groupings on the Council in relation to the Revenue Estimates 2009/2010;
(iii) a revised efficiency programme be developed in the context of a three-year financial planning cycle and that a report thereon be submitted to a future meeting of the Strategic Policy and Resources Committee;
(iv) Council officers continue to work with the Land and Property Services agency and the Minister of Finance and Personnel to seek to improve the position in relation to the Estimated Penny Product and the development of a Service Level Agreement between the Council and the Agency;
(v) a report on measures which could be introduced in order to support local businesses and ratepayers be submitted to the Committee in due course; and
(vi) a report be prepared on the key communication issues.
The Director of Corporate Services reported that following an examination of the Departmental Budgets an overall reduction in the Revenue Estimates of £1,042,560 had been identified. The reductions for each Committee were as follows:
Committee £
· Strategic Policy and Resources 362,560
· Development 310,000
· Parks and Leisure 200,000
· Health and Environmental Services 170,000
The impact of the aforementioned reductions in expenditure would reduce the District Rate increase to 7.63% which, when merged with the Regional Rate, would result in an overall increase of 3.15% to the domestic ratepayer.
The Director reported further that on 19th January, 2009 the Minister of Finance and Personnel had announced a package of measures worth up to £8 million to assist Local Authorities in dealing with the impact of the current economic situation. For the Council, the package totalled £1.44 million, of which £419,000 impacted directly on the Estimated Penny Product 2009/10. In addition, the Council would no longer have to pay a 3% contribution towards the cost of administering Housing Benefit, which would benefit the Estimated Penny Product by £226,658. Further, the impact on the Council payments from landlords had been reduced by £192,749.
The overall effect of those measures on the rates position for 2009/10 was that the required increase in the District Rate would be 7.16%, which was the equivalent of a 2.96% increase to the domestic ratepayer when the Regional Rate element had been included. For the average household in Belfast this would result in a rates rise of £24.06 per annum or 46 pence per week. The proposed increase was just below the current rate of inflation and compared favourably to the average Council Tax bill increase in England of 3.5%. The Director of Corporate Services indicated that, if the Committee were minded to approve the Estimates of Income and Expenditure, the overall net expenditure for the Council would amount to £121,719,530. After deducting the General Grant and the Estimated Credit Balance, an amount of £115,072,620 would be required to be met by way of the District Rate. Based on an estimated product of a Penny Rate amounting to £4,840,100, it would be necessary to determine a Domestic Rate of 0.272p and a Business Rate of 23.7748p to meet the Council’s Estimated Expenditure.
The Director stated that if the Committee approved the District Rate at the level which had been outlined, then the Council would have reduced its base budget by £6.7 million over the previous four years. The Council had now reached the point where any additional reductions in expenditure in the short-term could be made only by stopping or deferring projects, initiatives or events or by reducing the level of service delivery. In addition, there was a higher degree of risk attached to next year’s budget because of the uncertainty in predicting the Council’s level of income from fees and charges for the following year. If the predicted income levels were not achieved then there would be a need to find in-year savings to cover the deficit.
After a lengthy discussion, the Committee agreed to note the progress which had been achieved in relation to the production of the Revenue Estimates for the 2009/2010 Financial Year but considered that further work on the Estimates of Expenditure was necessary and directed that officers re-examine the Departmental Estimates of Expenditure in order to attempt to identify further possible saving in non?essential work/services and that a report thereon be submitted to the meeting of the Committee scheduled to be held on 6th February. It was agreed also that a special meeting of the Council be held on 12th February to consider the setting of the District Rate 2009/2010.
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