Prudhoe Town Council agreed the 2020/21 budget at its meeting last night. The budget will cost the average Band D householder in Prudhoe an estimated, additional £5.55/year, representing a 5% increase on last year.
In summary, the major changes in the budget include an increase in the monies available to support socially-driven youth activities, a capital commitment of £50k towards the redevelopment of Highfield Park Skate Park and a greater emphasis on building reserves to replace and improve the Council’s growing number of physical assets.
The precept element of Council Tax, collected by Northumberland County Council and paid over to Prudhoe Town Council, covers every item of expenditure of the Council. We calculate the amount needed in the following way:
1. Noting all fixed costs for the forthcoming year, i.e. the cost to run the Council and our contracts, less any expected income.
2. Agreeing additional budget for new items of expenditure or capital projects.
3. Agreeing an adequate general reserves and contingency figure.
4. Agreeing an earmarked reserve fund for large capital costs that will exceed one-year and to fund the future replacement of physical assets.
5. Calculating the balances expected at the year-end to off-set against the precept demand.
The Council agreed a budget of £327,836, with total reserves of £150k. With balances of £107,797, this gives a precept demand of £370,039.
Whilst the operating budget has decreased slightly, the Council has agreed a more strategic approach to holding reserves. General reserves and contingency have been increased to 25% of general running costs, an increase of 20% on previously held general reserves.
Additionally, the Council has agreed an earmarked reserves budget. This important consideration allows the Council to forward plan for larger projects and to replace physical assets.
The 2020/21 earmarked reserves pot includes £50k towards the development of a new skatepark at Highfield Park. It is expected that the project will be more than 12-months in the making, therefore, we can plan to include the remainder of any funds required in the 2021/22 budget. By January 2021 we should also have an actual design and have confirmed any funding we can achieve.
There is a further £40k in earmarked reserves which will be built up for the replacement and improvement of other physical assets; this includes bus shelters, litter bins and public toilets (environmental services) and play areas and allotments (recreation and leisure). The Council accepts that it is lacking in financial reserves for this purpose, but in order to limit the impact on the tax-payer, this fund will be increased over a number of years, following a review of assets.
The attached charts compare the budget agreed for the coming year with the expected outturn for 2019/20 (what we expect to have spent at the year-end minus any income). Click to open charts in PDF format.
The Council has increased its financial commitment and support of community groups and youth provision with an expected increase of 28%. The Grant Aid budget was maintained at £34k, with £20k committed for Prudhoe Youth Project and £20k committed for further, socially-driven youth provision, similar but not identical to ’42 days of summer’, held in 2019 and 2018.
Whilst investment in Edgewell Cemeteries remains at a very similar level, 9% of expected spending in 2019/20 against 6% in 2020/21, it would be fair to say that efficiencies have been sought in the cemetery in a bid to greater align income with costs. Further work on the south-east corner of the old cemetery will be carried out in the coming year.
The reduction in ‘other services’ can be attributed to contingency reserves being removed from this heading. The increase in ‘Recreation & Leisure’ is largely as a result of £50k being earmarked for Highfield Park and likewise the increase in Environmental Services is due to ear-marked reserves.
The Council spent considerable time agreeing the budget and in considering how best to improve the services and amenities of the community within an affordable precept. More detailed information will be available at the start of the financial year. Any questions can be directed to the Clerk, by telephone or email. Full budget and expenditure information is available on our Finance page.