Developing the Council’s Financial Plans

This part of this MTFP sets out the resource considerations surrounding the achievement of the aims of the Council given the changing environment in which it operates.  It covers the development of the budgets for the General Fund and Housing Revenue Accounts over the medium term outlining the financial resources needed to support the day to day activities of the Council as well as planned investment in its assets.

Medium Term Financial Planning

Councils are required by law to set their budgets in advance of a financial year so to enable the Council Tax to be set.  A budget is simply a plan expressed in financial terms, whereas medium term financial plans recognise the need to plan for longer timeframes and present indicative budgets for a number of years.

Given the relatively long time between when the MTFP is drafted and the final year that it covers (year 5) the budget projections within it are provisional and will need to be reviewed as part of subsequent years’ budget setting processes.  The main reasons why more firm estimates are not able to be produced are:

• Timescales for implementation – all plans are drawn up based on the best available information at the time of drafting and as time passes these plans need to be reviewed and at times revised.  Where a budget is associated with a change in policy or process, any delay can have significant implications for the budget.
• Government targets and policies – instructions can come from a number of external government agencies which the Council has little choice but to respond to, for which there can often be cost implications of doing so. 
• Market forces – The Council sources many of its supplies and services through competitive processes which enable us to keep our price increases to a minimum.  But even so, there are times when it can not avoid high price increases, especially for essential services and utility charges (such as electricity and gas).  Often these can not be anticipated with any accuracy very far in advance.

The figures that follow in this Plan represent best estimates using available cost information, uplifted for inflation (where appropriate) and planned implementation timeframes.  Where assumptions have been used the basis of these has been explained.

Next: General Fund Revenue Account

Back: The Local context

• Introduction
• Executive Summary
• Local Government Finance Environment
• Local Government Act 2007
• Value for Money
• The Local Context
• Developing Financial Plans
• General Fund Revenue Account
• Housing Revenue Account
• Capital Programme
• Treasury Management

Financial Services

E-mail:

accountancy@
thanet.gov.uk

Tel: 01843 577000