Home | News | Council tax freeze avoids 3% increase
News | 12th March 2021

Council tax freeze avoids 3% increase

Dumfries and Galloway councillors vote for budget proposals

Councillor Elaine Murray, leader of Dumfries and Galloway Council, and councillor Rob Davidson, depute leader, sign the agreement to form an administration

DUMFRIES and Galloway councillors have voted for the Labour / SNP administration’s budget for 2021/22 which includes a council tax freeze.

Members voted by 24 to 16 votes to push through the budget.

The council faced a funding gap going into 2021/22 of £4.4m.

Agreeing a council tax freeze will secure extra funding of £2.364m from the Scottish government.

That is the equivalent of a 3.05 per cent rise in council tax.

The council will also realign £741,000 of existing spend to focus on its priorities and use £1.297m of non-recurring funding, predominantly from an underspend in capital loan charges.

Its capital investment strategy will invest £426m in the region’s infrastructure over the next 10 years.

Councillor Elaine Murray said: “This investment will help grow our economy and support our communities to thrive.”

With agreement of a final Borderlands Inclusive Growth Deal anticipated soon, the budget proposals provide an indicative capital investment allocation of £13.6m, alongside other allocations, over the next 10 years to support the implementation of the deal and secure significant investment from the Scottish and UK governments into the region.

After a review of the roads service, the communities committee agreed an improvement plan in February which will allocate another £2.4m over the next three years to increase capacity in the service to tackle the backlog of repairs to roads.

The council is committed to its new waste and recycling services and the roll-out of kerbside recycling. By June 2021, the new waste collection service roll-out will be complete.

Full Council, at its meeting of 17 December 2020, agreed a Budget Setting Process and Timetable for the upcoming financial year.

A report to last Thursday’s meeting by Paul Garrett, head of finance and procurement, said the late notification of the Scottish government’s budget details for 2021/22, combined with the ongoing impact of COVID-19 and Brexit, made budget-setting more challenging than would normally be the case.

Mr Garrett said: “In recognition of this, it was agreed that the council’s 2021/22 budget process should focus on setting a one-year budget only at this stage.

“It was also agreed that the council’s established budget principles should be maintained and enhanced to include the more principles to support financial management and the current budget process.

“The council would continue to provide resources to support ongoing services and the COVID-19 response and recovery requirements, while avoiding establishing a recurring deficit.

“It would seek to retain flexibility to support unanticipated spending and avoid placing an undue burden on future taxpayers and service levels.”

He added: “While it is fully anticipated that COVID-19 will continue to affect the council’s required spending and income levels in 2021/22, the agreed approach assumes the resultant financial implications will be supported by the allocation of non-recurring funding support, including that provided by the Scottish government.

Members have recently received a briefing on the receipt of additional non-recurring funding to support the ongoing impacts of Covid-19, including ongoing loss of income and response requirements, as well as investment in recovery measures. 3.6 The budget process agreed by Full Council recognised the difficulty in identifying, developing and agreeing significant service changes and associated savings in the current Covid-19 response period and therefore

The council recognised that the limited use of temporary measures, including using non-recurring funding, might be appropriate in the current circumstances.

Where such temporary measures are reflected within budget proposals, Members are asked to seek to limit the extent of these to minimise the need to subsequently identify recurring savings.

Council Tax 3.9 As reported to the Finance, Procurement and Transformation Committee on 11 February 2021, the Local Government Finance Settlement includes additional funding of £90 Million (D&G’s share £2.364 Million) to compensate those Councils who choose to freeze their Council Tax levels at 2020/21 levels

While it is for Members to determine the approach to council tax setting, it is important to recognise that the receipt of this funding, which equates to a 3.05% increase on our current Band D equivalent, is conditional upon a council tax freeze being agreed. 3.11 The Scottish Government has also indicated that receipt of the announced funding settlement also requires delivery of the following:- · Local Authority Adult Social Care budgets for allocation to Integration Authorities must be £72.6 Million (D&G share £2.542 Million) greater than 2020/21 recurring budgets; and · Councils will continue to be required to maintain the pupil:teacher ratio at a national level and ensure places are provided for all probationers who require one under the teacher induction scheme. 3.12 Members are asked to take the above requirements into account when preparing and considering budget proposals. Policy Development Funding 3.13 As reported to the Finance, Procurement & Transformation Committee in February, the budget model currently includes additional funding to support two proposals that were agreed by Members as part of the COVID 19 response (Early Intervention in Social Work and Economic Recovery) at an estimated cost of £1.287 Million. 3.14 As reflected within that report, the budget model and the associated funding gap reflected above at para 3.5 does not include provision for any additional proposals/allocations. 3.15 Details of potential allocations which Members may wish to consider as part of their budget proposals have been reported to Service Committees during the year, including: · Climate Emergency – Economy & Resources Cttee 26 Jan · Skills, Employment and Inclusion (Kickstart) – Economy & Resources Cttee 26 Jan · Staff Health & Wellbeing Checks – Full Council 17 Dec · Virtual Desktop Technology – Education & Learning Cttee 4 Feb · Investment in Roads – Communities Cttee 9 Feb 3.16 Members are asked to ensure that any spending on new policy initiatives is of a non-recurring nature where possible, to provide increased flexibility for future financial years. Capital Investment Strategy 3.17 The Finance, Procurement & Transformation Committee of 11 February 2021, received an update on the Council’s previously agreed Capital Investment Strategy to reflect recent developments including the announcement of the 2021/22 Local Government Finance Settlement. As verbally reported at that meeting, the reported details were subject to a Scottish Government correction which reduced our Council’s 2021/22 General Capital Grant allocation by £193k and this adjustment is reflected within the figures provided at Appendix 2

Members have also been provided with an indicative Capital Investment Strategy which makes provision for proposed investment in both Dumfries Learning Town (Phase 2) and the Borderlands Inclusive Growth Deal. The Finance, Procurement and Transformation Committee also noted proposals in relation to the structure of asset classes and the allocation of funding between these to take into consideration as part of developing Capital Investment Strategy proposals. 3.19 Further advice and support is being provided to political groups to support their considerations for the development of the capital investment strategy to be reflected alongside their 2021/22 budget proposals.

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