Ashford Borough Council
Opens 29 December 2017
Closes 7 February 2018
At the last Ashford Borough Council cabinet meeting, members agreed a draft budget for the 2018-19 financial year, which begins on 1st April 2018.
The draft budget is presented to Council members at a time when the Chancellor of the Exchequer has just delivered his 2018 Autumn Budget to parliament. It is also set against the backdrop of the negotiations to leave the European Union, which continue to cause uncertainty.
Please read ABC’s draft budget summary document to help you take part in our budget consultation for the 2018-2019 financial year. We would value your feedback on our proposals.
2018-19_budget_consultation [pdf] 1295KB www.ashford.gov.uk/media/5384/2018-19_budget_consultation.pdf
The budget contains a large amount of information, so we felt it might be beneficial to outline the key points below:
It is proposed that Ashford Borough Council increases its element of council tax by £3.50 per year for the average band D property, increasing the amount payable to Ashford Borough Council from £154 to £157.50 per year– please note this is based on the Ashford element of council tax only and will be adjusted to reflect your property band.
For context, even if all the other local authorities in Kent froze their council tax Ashford would still be setting the lowest council tax in Kent.
The council proposes to increase its element of council tax by £3.50 (which equates to 2.28%) as government allows councils to increase their council tax by 2% or £5, whichever is greater. So, although ours is proposed to increase by 2.28%, this is within agreed parameters.
The council’s Corporate Plan is focused on the delivery of business and housing growth as well as income generation from commercial activities – such as the £42m Elwick Place project, which is on budget and on schedule. The commercial approach needs time to mature and so for now we propose to increase council tax, however the future ambition of the council is to do so by a smaller amount every year. For example, last year the council raised council tax by £4. This year it proposes to do so by £3.50.
Ashford will still set the lowest council tax in Kent.
The Chancellor’s budget spoke about increasing the premium on empty properties from 50% to 100%. This will affect 60 long-term empty properties in the borough.
It will encourage the owners of the properties to bring them back into use but will not increase revenue to the council significantly.
The Chancellor’s budget referenced the possibility for local authorities in areas of high demand to increase the debt caps within their housing revenue accounts (HRAs) to build new homes – the HRA is a separate account into which rent paid by tenants in the council’s housing stock is collected. The money collected in this account is solely for the use of management, maintenance, repairs and upgrading of these properties.
Following the announcement of a pot of funding being made available for local authorities during the Prime Minister’s conference speech in October, the council submitted a request to the Department for Communities and Local Government to increase our HRA debt cap by £21m to build 108 homes over five years. We await the official outcome of our request.
Local government funding
As the council anticipated some years ago, central government funding (which was known as the revenue support grant [RSG]) will cease in the 2018-19 financial year.
From 2019-20 onwards the council will be liable for ‘negative RSG’. This will see the council actually give money back to government so that it can help less advantaged councils. In the 2019-20 financial year the council is expected to pay a net amount of £140,000, rising to £358,000 by 2022-23.
The council will continue to lobby government about the fairness of negative RSG but it should be noted that the fact the council is liable to negative RSG indicates that the council’s finances are in a healthy position, despite setting the lowest council tax in Kent.
New Homes Bonus
New Homes Bonus (NHB) is measured on the number of properties that have been completed in a year (from October to September). An amount is paid to the council for a period of four years per property.
This calculation has changed, with the number of eligible years for payment reducing from six to four, thus reducing the overall funding to the council.
Ashford Borough Council is projected to receive £2.6m in the 2018-19 financial year but if it were to fall to below £2.1m there would be insufficient money to fund the base budget. Building homes therefore, is not only an obligation but critical to our success.
The council is looking to achieve 1% efficiency savings in the 2018-19 financial year – such savings will not result in any reduction in the quality or frequency of our services to the public.
Homelessness, inflationary pressures and planning appeals are all placing a greater burden on the budget and these can be offset by these savings.
Housing Revenue Account
The HRA is still affected by the 1% reduction in rents that must be applied between the 2016-17 and 2019-20 financial years.
The amount of funding required for disabled adaptations is reducing from £605,000 to £400,000 as the council has made good progress in meeting demand and reducing the number of people waiting as well as the time they are waiting.
Separate to the HRA, £200,000 will be set aside for disabled facilities grants in the private sector, for the 2018-19 financial year.
Cllr Neil Shorter, Ashford Borough Council’s portfolio holder for Finance, Budget and Resource Management, said: “Once again I am pleased to be able to report to cabinet the council’s sound financial position. This has been secured through our policy of good asset management, horizon scanning, planning ahead and investing in long-term assets that will produce a net income.