Report of the Assistant Director Resources / Treasurer

The Authority received the report of the Assistant Director Resources/Treasurer (ADR/T) presenting plans to roll forward the medium term service planning strategy and medium term financial plan (MTFP) for 2020/21.

The ADR/T explained to Members that this year the MTFP was essentially a roll forward of that agreed by the Authority in February 2019 with an additional year included.  Closer alignment of business and resource planning was necessary to ensure that the Authority could continue to deliver its corporate strategy and Integrated Risk Management Plan (IRMP) outcomes more effectively, this would continue for the 2020/21 budget setting process.

Members were reminded that there was continued uncertainty about the future of local government funding.  Despite this uncertainty the Authority would need to continue to drive through the service and budget planning process, identification of pressures and savings and cashable efficiencies.  It was important that consideration was given to the replenishment of reserves.  The ADR/T gave a brief update on the Government’s Spending Round announcement that had been made the day prior to the meeting.  This was for one year only and contained no specific reference to fire services.  There were some connections to the work of fire services including additional funding to the Government’s Building Safety Programme in the wake of the Grenfell Tower fire.

The ADR/T informed the Authority that the Spending Round indicated that baseline funding for local authorities would be protected in real terms for 2020/21 but it would not be known what this meant for this Authority until the draft Local Government Finance Settlement was announced possibly in December.  It was not clear at this stage whether the one off grant to fire services to cover additional pension costs in 2019/20 (worth £1.7m to this Authority) would be rolled forward into 2020/21.  Government intended to consult on a 2% Council Tax referendum threshold which was in line with our current modelling.  The anticipated Fairer Funding Review and changes to Business Rates Retention were to be delayed and it was hoped that a Comprehensive Spending Review would be announced next year.  The MTFP had been modelled for a reduction in funding, but this could yet be mitigated by the Government proposals in 2020/21 and the Service would continue to push for savings to ensure flexibility.  There remained significant concerns about funding and financial sustainability in the medium term.  Members thanked the ADR/T for all his hard work during uncertain financial times.

Members queried the reduction in sprinkler contributions, the ADR/T reminded the Authority that we were approaching the end of the 2 years additional funding that the Fire Authority had agreed to budget for, this would cease as planned in 2021.  It was added that there was still significant funding available, but it was important to be clear that the offer had been made to promote fitting of sprinklers and to encourage behavioural change, it had never been the intention that ESFRS fund Local Authorities.

Members requested that the ADR/T calculate the difference in revenue of a 1.99% increase compared to the currently intended 1.94%.  The ADR/T agreed to do so and to inform members of the potential difference the additional 0.05% might make.

RESOLVED – That the Fire Authority:

       i.          Approved the updated Medium Term Financial Plan for 2020/21 to 2024/25 and its underlying assumptions;

      ii.          Considered and commented upon the risks set out in section 3; and

     iii.          Considered their modelling preferences for Council Tax, should the Government set the referendum threshold higher than the 2% currently included in the MTFP.