Agenda item

To consider a report by the Head Finance and Assets (copy enclosed) which  provides the third update with regard to the process of setting the Council’s budget for 2014/15. 

 

A report by the Head of Finance and Assets, previously circulated, provided the third update with regard to the process of setting the Council’s budget for 2014/15.

 

Councillor J. Thompson-Hill provided a summary of the report.  He explained that an analysis of the Draft Local Government Settlement and the consequences for the Council had indicated that savings of approximately £8.5m would be required.  The budget process had to date resulted in savings of £1.7m for 2014/15 being approved by County Council in September (Phase 1) and £4.7m (Phase 2) on 3^rd December.

 

The savings included in Phase 2 had been presented to a Member Workshop in October with Lead Members, providing details of the saving, the impact and an assessment of risk.  Members had been invited to comment on any of the proposals prior to the Council in December.  Responses were received in respect of savings proposed in the school music service (£52k) and a review of the work opportunity service for adults with a learning disability (£50k).  Further detail in support of the music service saving had been reported to Council, and a Task and Finish Group had been established to oversee the review of work opportunities.

 

The budget process to date had identified savings of £6.459m, leaving a gap of approximately £2.0m and this had been the focus of the Member Workshop held on the 9^th December.  Details from this session had been included in the Appendix to the report and included:-

 

Final Local Government Settlement - The Settlement had been published on the 11^th December and was largely unchanged from the Draft settlement.  The most notable change being the Council Tax Reduction Scheme Pensioner Grant to the Revenue Support Grant, which now formed part of the Council’s base budget.

 

Third Budget Workshop - The workshop had been held on the 9^th December, 31 members. The key theme presented details and options to be considered to bridge the £2m budget gap for 2014/15.

 

The key information presented included:

 

·                     An update of the in-year position of social care and education budgets

·                     Analysis of school funding

·                     Options to increase school budgets

·                     Review of balances and reserves

·                     Corporate Plan update

·                     Council Tax options

·                     Additional Savings Proposals

·                     Recommendation

The additional saving proposals for 2014/15 related to bringing forward savings previously identified for 2015/16 and total £395k.  £95k related to bringing forward restructures in Business Planning and Performance and £300k was the proposed removal of the budgeted contribution to balances one year earlier than originally planned.  The recommendation included a proposal to use a general balances as part of the budget in 2014/15.

 

The final budget proposals would be presented to Council on the 27^th January, 2014. This would include a range of options and a recommendation for the level of Council Tax increase for 2014/15, and a detailed report on Council Tax levels would be approved by County Council in February.  The CA referred to the consultation process and possible ways in which the Committee could improve Member engagement.  The Chair felt that circulation of the papers for consideration, prior to the Workshop had assisted and informed the debate.

 

A recent budget workshop had revealed that the Council Tax level would be the key debate in the final phase of approving the 2014/15 budget.  A range of Council Tax options, and their financial implications, would be presented to Council in January.  In terms of the budget process the views of the Corporate Governance Committee would be welcomed on ways of encouraging engagement and debate with individual Members or groups prior to the report being presented to Council.

 

The officers provided the following responses to matters and issues raised by Members:-

 

-                 Confirmation was provided that Members had been encouraged to raise any issues about the proposals with the Lead Member or the Head of Finance and Assets at any point prior to formal proposals being taken to Council for approval.

-         The general consensus of opinion at the recent Workshop had been that the level of Council Tax increase should be 3%.  Councillor Thomson-Hill explained that although this was the target further consideration might be required depending on other balancing elements, such as the risk aspect.

-               The issue of the removal of funding for a Trade Union official by the Authority had been raised previously at Service Challenge meetings.  It was explained that it had been felt that the potential ramifications of such action outweighed the possible savings.  The CA informed Members that negotiations regarding this issue could be undertaken with the Trade Unions at a future date.

-               The Committee were informed that Member attendance figures at the Workshop had been influenced by the flooding in the County.

-               The CA provided details of the alarming increase in pension costs to the Authority and confirmed that these could increase by 20% over the next three years.  Reference was made to the recent changes in legislation which impacted on the figures, together with, changes to overtime regulations.

-               In response to a question from Mr P. Whitham regarding risks relating to the consequences of failing to meet the requirements of encouraging engagement and debate with Members, the CA provided details of the consultation and dialogue processes adopted.

-    Members were informed that planning for 2015/16 had already commenced and would escalate following approval of the 2014/15 budget.  The Committee noted that future budget planning would be extremely challenging and Member involvement in the decision making process would be crucial.

 

In reply to a question from Councillor M.L. Holland regarding the remit of the Committee in respect of interaction with external bodies, Members agreed that issues pertaining to Clwyd Leisure be included on the Agenda, as a Part II item, for the next Corporate Governance Committee.  

 

Following further discussion, it was:-

 

RESOLVED – that the Corporate Governance Committee:-

 

(a)          receives the report and notes the latest position and progress made to date, and

(b)          agrees that a Part II item on Clwyd Leisure be included in the Committee’s Forward Work Programme for the January, 2014.