GBC Executive Agrees Budget But Cites Future Challenges to be Faced

Published on: 27 Jan, 2021
Updated on: 27 Jan, 2021

The borough council’s Executive approved the budget for the next two years and other financial plans at last night’s meeting (January 26). These decisions will go to full council to be ratified next month.

Cllr Tim Anderson

Cllr Tim Anderson, lead for finance, said: “We started off this financial year in a good financial position with diverse income streams and a good level of reserves.

“But despite achieving savings through our ongoing Future Guildford Transformation Programme, supporting our communities through the pandemic means we have a projected £8 million overspend this financial year and we are using reserves to maintain our services, which is not sustainable.

“As we move into 2021-22, we initially had a predicted shortfall of £2 million. Additional funding from the government as part of the finance settlement and a significant review of the capital programme has meant we now expect to balance our 2021-22 budget, but we are projecting a significant deficit of £1.6million in 2022-23 which may rise to £5.9million by 2025-26 if we do not take action.

“We have government funding to cover some Covid expenditure but our commercial income such as retail and hospitality, car parking and income from sports facilities which brought in about £21 million each year has been severely impacted.

“For us to maintain a strong financial position it’s important that we continue with our forward-thinking approach through our new finance and saving strategy. We need to avoid any further reductions in our general fund reserves for a medium-term balanced budget.

“While we continue to face further financial challenges in the next two to four years due to the continued reductions in government funding and the ongoing pandemic, we must remember it is later in 2022-23 when we expect to face the most significant impact and while we will have difficult decisions to make, our residents remain at the forefront of everything we do.”

Capital Programme Investment

Cllr Anderson (R4GV, Clandon & Horsley) added: “We have an ambitious capital programme to invest in the borough and our services and meet the targets within our Corporate Plan. The budget for 2021-22 includes projects from our existing Corporate Plan and some new projects such as investment in services to address climate change, housing and infrastructure which will feature in our next plan, due later in 2021.

“We are adopting a new, more rigorous approach to our projects so the decision to fund each future scheme will become part of a more detailed business case to help us evaluate the relevance and need of the project.

“We have reduced part of our capital programme after a review but will continue to invest in the borough – particularly in regeneration schemes to deliver housing on brownfield land.”

Key projects for 2021-22:

Guildford Economic Regeneration Programme;
North Street Regeneration Scheme;
Strategic Property Acquisitions;
Town Centre transport schemes;
Town Centre Masterplan;
Ash road bridge;
North Downs Housing / Guildford Holdings;
Midleton redevelopment;
Weyside Urban Village; and
Sustainable Movement Corridor.

The following schemes will be removed from the capital programme subject to the full council’s approval next month:

Museum;
Public realm;
Bike Share; and
Town Centre gateway regeneration.

If all planned schemes were to continue within their predicted timescales, there would be an underlying need to borrow £400 million by March 31, 2025. The consultation, with Guildford residents detailed below, has helped shape the decision to remove these projects.

Council Tax

The provisional Local Government Finance Settlement (LGFS) for 2021-22 included giving local authorities the ability to increase the level of council tax by up to £5 without the need for a referendum.

To set a balanced budget, council tax will be increased by up to £5 this year. The council tax requirement for 2021-22 is set at £10,392,720.

GBC receives about 5% of the council tax. For an average Band D property, GBC keeps £200 a year. Surrey County Council gets 76%, the Police and Crime Commissioner 13% and parish councils 2%.

For the £200, GBC has provided about £450 of services per household through commercial income such as property investment, car parking and income from sports facilities. Before Covid-19, these brought in about £21 million each year.

Investing and maintaining services

The council has been streamlining and modernising services to become more efficient through the Future Guildford Transformation Programme, which enables a saving of £4.9 million a year in 2021-22 compared to the spend two years ago.

In December 2020, Guildford’s residents were asked where the council should prioritise spending for the medium-term, using an independent, experienced research company called SMSR Ltd.

A representative group of 1,100 people aged 16 to 65+ selected by random sampling were phoned. An online survey with the same questions was completed by 381 residents. The survey was shared with all of councillors, parish councils, residents’ associations and other partner agencies.

The services residents didn’t feel were a high priority for spending were arts and heritage, and tourism. They also felt transport and parking and public facilities such as public toilets were less important. These results will inform the savings strategy.

Climate Change

Over the past 10 years, GBC has invested approximately £10 million on initiatives on the estate and in social housing to achieve significant carbon reductions in the borough.

Last year, a new high-level action plan was agreed that will help continue to work towards achieving net-zero carbon by 2030. This will include developing projects aimed to reduce carbon emissions through operational services.

To help reduce emissions and improve air quality, 20 new electric vehicle charging points will be installed in Guildford town centre with additional charging points in car parks.

There are also new initiatives to help residents across Surrey reduce their carbon emissions and save money. A new Green Homes Grant of up to £15,000 will help eligible owner-occupied households to improve the energy efficiency of their homes and save money.

Affordable homes to buy and rent

Cllr Caroline Reeves, lead for housing and development, said: “We reinvest all surplus on the housing revenue account along with profits from the sale of our council houses under the Right to Buy scheme (RTB) into new affordable new build housing and regeneration.

“There are plans to expand our Housing Revenue Account (HRA) Capital Programme across a range of sites and there is considerable capacity to build new homes across our 30-year business plan.

“We understand the need for affordable, energy-efficient housing in our borough and we have some really exciting projects on the horizon including Weyside Urban Village and the North Street Regeneration Scheme.

“Both projects involve regenerating brownfield land which will protect our green belt and prevent urban sprawl while providing some affordable housing and attractive environments for all ages both from the borough and attracting new residents to Guildford.

“We also have housing schemes in place to continue to redevelop town centre, brownfield sites such as Guildford Park and Bright Hill car parks to allow us to increase our own housing stock, while offering affordable town centre housing. This is an exciting new chapter in Guildford’s future.”

Opposition parties have been invited to comment. Please check back tomorrow for report.

See the Executive Agenda here

See the Budget Consultation: Results Report here