Calculation of available resources to fund the revenue budget 2007/08
A crucial part of the budget strategy is to identify the level of resources available to fund the council’s revenue budget. These resources come from 1) the government via its revenue support grant and the distribution of business rates income from the national pot and 2) from our residents via the council tax. For 2007/08 the amount of available resources was calculated by as follows:
Projected council tax income
One of the priorities of the financial strategy is for the council to maintain a policy of low council tax increases. Council tax rises are to be no more than 3% per annum for Salford’s services. A 3% increase on the 2006/07 council tax level would produce a 2007/08 council tax level of £1,250.17 for our services (£1,213.76 + 3%).
The expected income from council tax in 2007/08 based on a 3% increase in the charge multiplied by the number of chargeable dwellings is as follows:
| Description | Amount |
|---|---|
| Band D council tax for the council's services in 2006/07 | £1,213.76 |
| Add: 3% based on the maximum increase per budget strategy | £36.41 |
| Band D council tax for the council's services 2007/08 | £1,250.17 |
|
Multiplied by: the council tax base (assumed number of Band D equivalent dwellings) |
£65.345 |
| Estimated council tax revenue 2007/08 | £81.692m |
Government formula grant
Government funding provides approximately 58% of the resources required to fund the council’s budget. The government decides how much it can afford to allocate to local authorities and then distributes it based on an assessment of perceived needs using complex formula. This calculation takes into account information including population, social structure and other characteristics of each authority. The amount of government grant allocated to the council under these arrangements is £115.652m.
Council tax surplus collection in prior years
The council has forecast that it will have a surplus collection of council tax by 31st march 2007. This effectively means that we will have collected more council tax than is required to fund our budget needs. This surplus will be used to reduce the council tax requirement in 2007/08 by £0.885m.
Total available resources
Based on the above information the total resources available to the council are as follows:
| Formula grant from the government | £115.652m |
|---|---|
| Council tax based on a maximum 3% increase on 2006/07 | £81.692m |
| Collection Fund - council's share of a projected surplus of £1m | £0.885m |
| Total available resources | £198.229m |
Budget assumptions and key service issues
This page was last updated on 01 June 2007
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