Agenda and minutes

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Note: Start time : 12:00 noon or immediately following the prior meeting of the Council, whichever is the later. 

No. Item



To receive apologies for absence.


An apology for absence was received from Mr. R. Childerhouse.



Non-members wishing to address the meeting

To note the names of any non-members wishing to address the meeting.


Lady Fisher, Executive Member for Governance, was in attendance.



Draft Estimates 2009-10 - Consultation (Agenda Item 4) pdf icon PDF 173 KB

Report of the Executive Member (Governance) as previously submitted to the meeting of the Cabinet on 14 October 2008.

Additional documents:


The Assistant Director, Governance, presented the draft Estimates for 2009-10 and updated the Committee on changes which had been made to take account of circumstances since their original preparation for Cabinet in October.


The following items were highlighted and discussed.


1.      Executive Summary


The budget allowed for a worst-case scenario regarding the position on the investments with the Icelandic banks and a comment would be added to the Executive Summary on page 2 to suggest there might be a need to draw on the General Fund balances if necessary.  It was noted, however, that the money at risk was capital monies and this would not impact on day to day service delivery.


2.      Assumptions


Consideration was being given to the best means of strengthening the protection on existing and future investments, for example whether through Government-backed securities or investing in other local authorities via fixed term terms to meet their short-term borrowing needs.  The latter was something the Council had done in the past. 


A member commented that there were indications that the majority of the Council’s Icelandic investments would ultimately be returned and it was noted that the Council would have some time before it needed to make a decision on future investment policy.  In the meantime, advice was being sought.


The budget did not assume a general inflation rate across the board and inflation was included only in budgets where necessary, for example to allow for the impact from rising fuel and energy prices or where existing contractual arrangements included contract inflation.


The average cash balance had been adjusted downwards from £27m to £14m in 2009-10, allowing for the position on the Icelandic investments, but future years assumed this money would be returned.


It was also noted that the return on cash investments was currently based on an average return of 4% but it was recognised that this could drop in the New Year consequent on further decreases in bank base rates.


3.      2008/09 Outturn


The investment income figure in the report to Cabinet would need to be adjusted to reflect the Icelandic bank situation. Over the years, the Council had normally overachieved on its investment income, which would help in the current financial year but there were budgetary pressures in other areas.  The 2008/09 outturn on this had been affected by recent events and reflected the impact from the drop in interest rates over the period since March.


The budget allowed for lower rent from commercial properties and offices, in particular service charges which the Council was not able to recover, but it was noted some further corrections to these figures were required to be made.  Generally, however, it was considered that the commercial portfolio was holding up well in the current economic climate.


With regard to contract inflation, the indices this year had reached 5% but they were now expected to tail-off quite quickly in the short term but were expected to rise again.


The outturn on utilities costs and empty property business rates reflected the  ...  view the full minutes text for item 53.


Next Meeting

To confirm arrangements for the next meeting.


The date of the next meeting was confirmed as Friday, 9 January 2008.