Agenda item - Budget Update and Savings 2014/15

Report of the Executive Director for Finance & Resources (copy to follow).

(1)               That the updated forecasts for resources and expenditure for 2014/15 and an estimated budget savings requirement for 2014/15 be noted;

(2)               That the indicative allocations of one-off resources for 2014/15 set out in table 1 subject to the identification of sufficient further one-off resources to fund the proposed allocations be noted;

(3)               That the revised savings targets for 2014/15 and considers the budget strategies and detailed savings proposals relating to the General Fund for 2013/14 shown in appendix 5  be noted and their release for the scrutiny review be approved;

(4)               That the update on the HRA budget set out in paragraph 3.36 to the report be noted;

(5)               That the summary Capital Investment Programme set out in paragraphs 3.40 to 3.45 and appendix 6 to the report be noted.

76.1         The Executive Director for Finance & Resources introduced the report which set out the proposals for the General Fund Revenue Budget and Council Tax for 2014/15.  The report also provided an update on the Capital Programme, schools funding and Housing Revenue Account.  She noted that the Chancellor’s autumn statement had only been released earlier in the day and that this would have a bearing on the budgetary position which would have to be taken into account as part of the budgetary process for the Budget Council meeting in February.

76.2         Councillor Littman thanked the officers involved in producing the report and all those involved in bringing forward savings proposals.  He noted that the Budget report had been published early again so that comments could be made and where appropriate taken into consideration as part of finalising the budget proposals for 2014/15.  There was a need to achieve the savings targets and to protect services and he hoped that over the next few months that position would become clearer.

76.3         Councillor Morgan noted that there was a significant budget gap predicted at present and that the opposition groups had only had the budget report for a week so it was too early to comment fully on the proposals.  He was however disappointed by the piece-meal approach taken towards the savings and noted that government funding levels had been reduced.  He was concerned that the voluntary severance scheme had not achieved the anticipated savings and asked for clarification in regard to the level of business that was conducted with Able & Willing and the fact that the Welfare Rights post had remained unfilled since the last Budget Council.  He was unsure why it had remained open for redeployment rather than being recruited to.  He also asked for reassurance that the proposed cuts to the Homelessness Budget would not impact on the level of support that was required.

76.4         The Executive Director for Adult Services stated that she would need to look into the contract information for Able & Willing and would respond to Councillor Morgan in writing.

76.5         The Executive Director for Finance & Resources stated that the cuts to the Homelessness Budget related to a 3-year plan and a number of aspects which involved other providers within the city; which it was hoped would not impact on the level of support that needed to be maintained.  The budget was under-spending at present and would be monitored regularly.  In regard to the voluntary severance scheme, it had not resulted in the level of savings anticipated for the current financial year and it was not proposed to repeat it in the next one.  However, there was a likelihood that some services would need t be realigned and re-designed and as such would contribute to the savings target.  She did not have the information in relation to the Welfare Rights Team and would therefore respond to Councillor Morgan in writing after the meeting.

76.6         Councillor G. Theobald stated that the Conservative Group would not seek to start from the position as outlined in the report and suggested that consideration be given to freezing council tax and accepting the government support.  He also questioned why external advisers were only now being used to comment on the organisational structure of the authority rather than 3 years ago.  He believed that there was a need to look at how services were delivered and commissioned and that this work should have been undertaken at a much earlier stage.  There should be a much greater role for the voluntary and third sector to provide services and therefore his group could not accept the proposals as outlined in the report.

76.7         The Chair noted the comments and stated that the use of consultants was nothing new and would help to review how the organisation could maintain services when faced with such savings requirements and achieve value for money.  He also stated that the authority had £3.7m less in available funding because of the decision to freeze council tax and this needed to be avoided this time round otherwise there was a likelihood of services being lost.

76.8         Councillor A. Norman stated that she was concerned about the reduction to the discretionary grants programme and the need to support the voluntary sector and to work with them more closely.  She also queried the situation in relation to the business rates where she noted that the level of income was £2m higher than expected, but was being off-set by a reduction in the safety-net grant, rather than being used to cover the budget gap.

76.9         The Executive Director for Finance & Resources stated that business rates had been predicted to be below the safety net but for next year would be above it.  This may have an impact as it would become real income but it needed to be considered in line with the information contained in the autumn statement and therefore it was intended to bring a report to committee in January.  It was likely that the council would have to make some difficult decisions as had been the case last year.

76.10    The Chair stated that he agreed the Third Sector was an important area and needed to be supported and he would welcome any ideas in terms of whether services could be supported by or provided by Third Sector organisations.

76.11    Councillor Littman stated that the main difficulty arose from the reductions in grant funding made by central government and that there was a need to look at all the alternatives and make a judgement call on the need for a council tax rise.  He hoped that a balanced budget for the current financial year could be achieved so that savings and alternative provision could then be considered for 2014/15.  He stated that there was an aim to support Able & Willing and for the business to succeed and noted that the new Head of Procurement was looking at contracts to see if the organisation could be used.

76.12    Councillor Peltzer Dunn referred to page 81 of the report and questioned the £10k saving relating to traffic signals and expressed his concern that such a saving was hidden in a large report which had an impact on road and child safety.  He also questioned the level of saving for on-street parking and the benefit of that which was being achieved from enabling people to pay by phone when cash machines were being removed.

76.13    Councillor Davey stated that the proposed removal of traffic signals was based on safety evidence figures that zebra crossings were safer than those with lights.

76.14    Councillor G. Theobald asked for clarification in regard to the cost of the external advisers and the total gross expenditure for the authority in 2014/15.

76.15    The Executive Director for Finance & Resources stated that she would provide the information following the meeting and noted that for the current year the total expenditure had been £774m.  She also noted that the value for money programme that had been running for the last 3 years had been successful and that the appointment of advisers for the next programme was subject to a render process and a budget of £75k had been identified.

76.16    The Monitoring Officer stated that in having regard to the Hampshire & Somerset Decision, it would be helpful to note the information contained in the Equalities Impact Assessments (EIAs), which had been made accessible to Members and therefore proposed that a further recommendation to that effect be considered.

76.17    The Chair noted the comments of the Monitoring Officer and stated that he was pleased to be able to put forward budget proposals for consideration and consultation at such an early stage with a view to being to amend them in light of feedback received and alternative proposals that may come forward.  He noted that last year’s budget proposals had been altered as a result of comments and therefore put the recommendations with the additional one of noting the EIAs to the vote.

76.18    RESOLVED:

(1)               That the updated forecasts for resources and expenditure for 2014/15 and an estimated budget savings requirement for 2014/15 be noted;

(2)               That the indicative allocations of one-off resources for 2014/15 set out in table 1 subject to the identification of sufficient further one-off resources to fund the proposed allocations be noted;

(3)               That the revised savings targets for 2014/15 and considers the budget strategies and detailed savings proposals relating to the General Fund for 2013/14 shown in appendix 5  be noted and their release for the scrutiny review be approved;

(4)               That the update on the HRA budget set out in paragraph 3.36 to the report be noted;

(5)               That the summary Capital Investment Programme set out in paragraphs 3.40 to 3.45 and appendix 6 to the report be noted; and

(6)               That the cumulative Equality Impact Assessment, (appendix 9) and the Budget Equality Impact Assessment Screening Documents (appendix 10), to the report which were made available in the Members’ Rooms and online be noted.

Note:   The special circumstances for non-compliance with Council Procedural Rule 3, Access to Information Procedural Rule 5 and Section 100B(4) of the Local Government Act 1972 (as amended), (items not considered unless the agenda is open to inspection at least five clear days in advance of the meeting), were that some of the key financial information could not be updated until the in-year budget monitoring report elsewhere on the agenda had been completed.