Report of the Assistant Director Resources/Treasurer

The Authority considered the report of the Assistant Director Resources/Treasurer (ADR/T) seeking approval to roll forward the Fire Authority’s medium term service planning strategy and medium-term financial plan for 2022/23 to 2026/27.  Whilst the main purpose of the report was to set the financial context for the service planning process, through an update to the Medium-Term Finance Plan (MTFP), the fundamental aim was to determine how best to deliver the Authority’s Purpose and Commitments, the IRMP and the targets and priorities underpinning them, within the current estimate of available financial resources for the period.

The ADR/T explained to the Authority that this report was an opening position for the Budget setting process.  The report highlighted the level of uncertainty there was with the current financial situation which had increased as a result of the current Covid-19 pandemic.  The fire sector had made a strong submission to the Government’s Comprehensive Spending Review, but the timetable remained unclear and it was unlikely that the outcome would be known until the autumn with a provisional settlement expected in late December.  It was possible given the broader economic uncertainty that the Government would opt for a further one-year settlement which would not aid planning over the medium term.  Nationally the sector was reliant on significant one-off funding investment in protection services, and locally forecasting growth in income from Council Tax and Business Rates remained limited.  This made planning for the 2022/23 budget and beyond extremely difficult.

It was proposed that the existing MTFP be rolled forward and the report demonstrated the best, worst and mid case scenarios that were facing the Authority.  The key issues that the Authority needed to consider and provide guidance to officers for were the provision for future pay awards, currently 2.5% although the sector norm was currently 2%, therefore there was synergy in reducing the provision in the budget.  The second point for consideration at this meeting was the flexibility on setting the Council Tax precept, currently this was limited and Fire Authorities were once again seeking permission to be able to set up to £5 as a rise rather than 2%, this had been turned down by Government when requested by the sector last year.

Members thanked the ADR/T for the report and suggested that a briefing be held to provide local MPs with an update on ESFRS financial situation and in particular to request support with the lobbying to government for long-term funding to be provided in the CSR.  Officers confirmed that a briefing had been arranged with MPs in October.  Some Members agreed they would like the option to increase the Council Tax precept by £5 rather than the current permitted 2% but felt it was unlikely to succeed as a request.  Some expressed concern that the current pressures on pay would likely get worse rather than plateau. 

Clarification was given by the ADR/T to Member queries as to why future Climate risks were not included in this report, it was highlighted that those risks presented were, in the main, specifically financial.  The CFO reassured those present that ESFRS was acutely aware of the effects of extreme weather and that there was a correlation between the financial planning and the cost of responding, indeed responses to these events were too quickly becoming business as usual, but these risks were detailed within other service documentation including the Integrated Risk Management Plan, the Risk Register and the Strategic Risk Framework and there was a clear link to these documents within this paper and therefore were not duplicated in full.

There was a request from Members to take the recommendations for this report separately.  All four recommendations were agreed by a majority, but recommendation (iv) was abstained on by the three Green Party members.

RESOLVED – The Fire Authority:

       i.         approved the updated Medium Term Financial Plan for 2022/23 to 2026/27 and its underlying assumptions;

     ii.         considered the risks set out in section 4.6;

    iii.         agreed that the provision for future pay increases should be reduced to the sector average of 2% pa;

   iv.         agreed that, should the Government set the referendum threshold higher than 2% or grant more flexibility, then the Fire Authority would consider its options above the 1.99% increase currently modelled when setting its Council Tax precept.