Rushmoor Borough Council’s new Cabinet has welcomed an independent report that highlights the severe financial challenges facing the council and maps out the steps it needs to take to put it back onto a sound financial footing over the next three years.
At a meeting on Tuesday (July 23) members were advised that it would mean some tough decisions, including the sale of council assets, a review of the council’s regeneration programme, and further savings on services. However, the Leader of Rushmoor Borough Council, Councillor Gareth Williams, told members that he was confident that the new leadership could bring the council back into a sustainable financial position, maintain key services to residents and deliver on their promises including town centre regeneration and a new leisure centre.
In a report to Cabinet, members were told that last year’s budget had been set using £5.4 million of reserves and, without taking any action, the council’s Medium Term Financial Strategy (MTFS) would have a revenue shortfall of just over £19 million over four years with only £10 million in reserve.
The council has already agreed a financial recovery plan aimed at putting it on a firm financial footing and asked the Chartered Institute of Public Finance and Accountancy (CIPFA) to assess how robust its plans were.
Cabinet heard that CIPFA had now published the report, which highlighted that without taking immediate action to reduce the level of debt, the council would not be financially sustainable in the medium term. It confirmed, however, that the council’s recovery plan, if delivered, would put it back on a sound budget footing by 2027/28.
The Cabinet also heard that since CIPFA had carried out its initial assessment, the council’s financial position had improved from a predicted £2.2 million overspend, to a £1.2 million surplus in the previous financial year. However, this was mainly due to corrections to prior year errors. Using more realistic assumptions than in the original plan meant that the challenge to delivering financial sustainability was even greater than set out previously.
The Cabinet noted the end of year position for 2023/24 and made a set of recommendations to council, including a cross party Cabinet Working Group to oversee the plan. The recommendations were approved by the council on Thursday (25 July).
Councillor Williams said: “I welcome the CIPFA report, which confirms our earlier concerns about the council’s finances. Since taking control we have seen that the position is, if anything, worse than we had thought. As a new administration, we are uniquely placed to take a fresh look at the budgets and the council’s priorities, and to get the council back onto a sound and affordable footing.”
The Cabinet will receive a further update on the council’s finances in September. For more information, please see the Cabinet report.
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