Agenda item

The Board considered the following three reports in advance of their consideration at Full Council on 13 December 2016. The following comments were made and were conveyed to Full Council.

Approval of Council Tax Base 2017/18.

This year the Council Tax Base is set at £124,083 which is a significant increase from last year. The unprecedented increase is due to growth in the city but also the reduction in the Council Tax Support Scheme. This is a sound figure based on a number of assumptions detailed in the report. The factual figure was provided by the Valuation Office in October. Estimating the number of students was difficult as they were 100% discounted. Lots of additional student housing was being provided as there’s been an influx of students into the City Centre and Bristol generally, which was significant. 

The following points arose from discussion:-

1.      A Councillor observed that the Council used to get compensation for students but if that had disappeared it would have  quite an effect on the Council budget;

2.      The surplus and deficit calculations had not been calculated yet as they were not due until early 2017 ;

3.      The issue of students was particularly relevant as a large development of student accommodation had been approved at Temple Meads, which meant less revenue going through. It was important to know the impact of this. He asked that additional information be provided in relation to student Council Tax exemptions and for information comparing previous council tax base forecasts against actuals;

4.      A Councillor who represented the ward with the largest number of students stated that the cost of students was effectively a loss to the Council. Three storey houses in his ward would become HMOs and displace people paying resident rates; The Chair observed that the issue of affordable housing for those who most needed it was a cross- departmental scrutiny issue which should be  considered  by the Cabinet;

5.      The Interim Chief Executive stated that the figure of £9m could not be considered a loss to the Council. Any change to student discounts would require an amendment to government legislation;

6.      The Chair referred to the reduction in benefit claimants and asked whether there was a presumption that there would be a permanent reduction in claimants and if so how was it possible to protect against financial challenges. There was a real contingent risk that if benefit claimants increased one year the Council could find it had a deficit when it had budgeted for a surplus. The Section 151 Officer acknowledged that this area was always volatile. Assumptions were trend informed and a range of scenarios had been modelled to arrive at prudent and robust assumptions.

Capital Receipts Flexibility.

This was a Cabinet referral to Full Council detailing the recent change in legislation that allowed Capital Receipts to fund revenue transformational change. This strategy would enable the release of up to £5.3m from revenue reserves that could be used to partly mitigate the 2016/17 budget pressures.

The following points arose from discussion:-

1. This was a one-off payment to bolster revenue. The MTFP had earmarked reserves so this would not impact on revenue. The funding was mitigated as it was anticipated to be a one off;
2. This could not be used for the combined authority as it was not yet in existence.

Review of Minimum Revenue Provision (MRP) Policy.

This was a referral from Cabinet to Full Council detailing the re-profiling of debt to better reflect the life of assets and which would provide significant savings to the Council’s revenue fund. This would allow the debt to be repaid in 50 years.

The following points arose from discussion:-

1. The debt was still managed separately, the MRP impacted on the revenue account. This was an accounting adjustment by aligning the amount of money set aside to the lifecycle of the asset;
2. The Chair expressed concern that this was effectively depreciation and future adults would have to pay. The Section 151 Officer replied this was prudent accounting as with current arrangements the Council would never repay that debt.

RESOLVED –

1. that the reports be noted;

2. that the additional information requested in relation to the Approval of the Council Tax Base report be provided in advance of Full Council.