Agenda item

Draft Finance Strategy


Members received a report which provided a draft of the Authority’s Finance Strategy and a request to continue the consultation with borough Directors.


Jay Patel, Finance Director, outlined the content of the report which incorporated the feedback from the Directors into the strategy before Members. The Boroughs recognised the need for the Authority to maintain a suitable level of reserves to address the risks from changes in legislation. Two thirds of the excess reserves would be returned to the boroughs to use as they saw fit and suggested Finance Directors ringfence budgets for waste projects within boroughs. It was intended to submit the final strategy and formal feedback from Finance Directors to September meeting.


In terms of ringfencing to reduce waste to mitigate costs, a Member asked whether the use of solar panels to reduce energy costs. It was confirmed that this had been discussed broadly with Directors and was being progressed by the Climate Emergency Officers Group.


A Member stated that he was not in favour of Authority mandating how boroughs used the returned reserves as what might be right in one borough was not necessarily right in another. Whilst accepting that these were exceptional times, the Authority was in the unusual position of seeing a benefit from higher energy costs. Consideration needed to be given to the level of reserves and the principle that a third would always be retained by the Authority and how this could be justified to residents. Members should be determining the level of reserves required by the Authority for strategic safety. Another Member requested clarity as to when it had been decided that the Authority would retain one third for strategic projects.


The Finance Director advised that these were the questions also being asked by Borough Finance Directors and the strategy had been updated to reflect these points. The strategy provided the opportunity for stakeholders to review both the strategy and reserve levels regularly. The principle was to manage the risk of change in legislation but that if those changes did not materialise in 2-3 years’ time the reserves could be returned to the boroughs. Officers did not want boroughs to struggle with big increases or decreases in levies and reserves provided a way of mitigating and smoothing the impact. He added that there were no conditions attached to the reserves returned to boroughs. Ian O’Donnell, Treasurer advised that it was key, as an Authority, to ensure that the challenges ahead could be managed. He added that from the conversations with boroughs it was clear that there were opportunities for both the boroughs and the Authority in relation to collection and disposal of waste and downstream operations. Working together on this was important and encouraging boroughs to invest in their waste operations could see benefits down the line.


In response to a question in relation to Appendix 3 of the report and whether any consideration had been given to sharing risk registers and building joint risk statements, the Finance Director advised that the information in the report provided borough colleagues with a useful tool highlighting potential impacts and options. The Head of Service Delivery added that, following a workshop and away day in March, boroughs were working together to develop a collection and disposal plan for 2030 and that consideration would be given as to how to manage any changes in legislation and the risks moving forward. A Member welcomed the suggestion in terms of combined risk registers.


RESOLVED: That (1) the Draft Finance Strategy attached at Appendix 1 to the report, be approved for consultation with borough Directors;

(2) the aim to bring a final document to the September Authority meeting for approval be noted.



Supporting documents: