The Mayor presented a report for Executive’s consideration.
The Council was required to set a legally balanced budget for
2024/25 by the statutory deadline of 11 March 2024. This was the responsibility
of all Council Members. At its meeting on 20 December 2023, Executive
considered an update report in relation to progress made in developing the
2024/25 Budget and MTFP for the period 2024/25 to 2026/27.
The report identified that, despite substantial work
undertaken by the Leadership Management Team, the Elected Mayor and the
Executive to identify savings and income growth proposals sufficient to balance
the 2024/25 budget, a shortfall of £6.279m remained for 2024/25.
Further gaps of £1.596m for 2025/26 and £0.305m for 2026/27,
equivalent to a cumulative budget gap of £8.180m were also reported. The draft
savings and income growth proposals that were subject to consultation totalled
£14.038m in 2024/25. This was equivalent to 11% of the 2023/24 net budget of
£126.354m and was of significant scale and challenge for Middlesbrough Council.
These savings rose by a further £5.083m in 2025/26 and
£1.967m in 2026/27, presenting a cumulative savings plan of £21.088m by the end
of 2026/27. It was also proposed to levy a total Council Tax increase of 4.99%,
comprising 2% on the Adult Social Care Precept and 2.99% on general Council
Tax. It was possible for the Council to seek authorisation from the Department
of Levelling Up and Communities to waive the referendum limit to levy a higher
Council Tax as part of its application for Exceptional Financial Support, but
this course of action was not proposed.
Executive was advised if the Council was unable to agree and
set a legally balanced budget the s151 Officer was required by law to issue a
s114 Notice under the provisions of the Local Government Act 1988. The
implications of issuing a section 114 included no new expenditure being
permitted, except for funding statutory services, including safeguarding
vulnerable people, at minimum level as well as existing commitments and
contracts would continue to be honoured.
Decision type: Non-key - Low
Decision status: Recommendations Approved