Agenda item

(Indicative timing 3:05 – 4:05pm)

The Panel considered the draft Budget for 2023/24 for the areas within the remit of the Panel and the main messages from it, as identified by the Director for Commercial and Change and the Strategic Director for People.

The Chief Financial Officer introduced the Report and advised the Panel that Cabinet had published the draft Budget Proposals on 5 January 2023 and that the Council was now entering a stage of engagement with various partners and organisations. Any comments from this meeting would be fed back to the Overview and Scrutiny Performance Board on 30 January which would then be fed back to Cabinet on 2 February and then be included in the Council meeting of 16 March 2023.

The budget headlines were:

·         There had been a £27.7m increase in the Council’s net budget of which £14.1m related to the increase from Council Tax income, £8.4m from the increase in Business Rates/SFA and £5.2m net use of reserves. 

·         The Local Government Settlement Grant of £26.3 million had been announced in December 2022 and had been welcomed by the Council.

·         The Council was experiencing budget pressures for 2023/24 with a £30.6 million demand in care services.

·         The Council’s capital programme would continue with further money being invested into highways and footpaths and a further £3.5 million funded from reserves for public transport.

·         Proposed Council Tax increase of 2.94% plus a 2% Adult Social Care levy equating to a £69 p.a. increase for a Band D property and would remain one of the lowest increases in Council Tax for County Councils without fire responsibilities.

·         The budget pressures relating to Communities were c£2m due to pay and contract inflation which would be offset by £1.64m of savings resulting in a net investment of c.£0.3m.

·         The Corporate areas had total revenue investment and inflation of c£10.8m, revenue savings, efficiencies and income generation of £8.6m resulting in an overall net investment of £2.2m.

·         There was a £0.5m revenue increase to for Legal Services

·         One of the largest savings in the whole of the budget was Pension Fund backdating totalling £4,464m. The Panel were advised that the pension fund has done incredibly well in terms of its level of investment which enabled employer contributions to be reduced, giving a significant saving.

·         The Revenue Net Investment for the roll out of the Libraries Unlocked technology totalled £225k.

·         Savings of £184k in HR relating to vacancy management were on course as in Financial Services for example, vacancies had already been deleted and there was no expectation to recruit to them.

During the opportunity for questions, the following main points were noted:

• It was confirmed that the £0.5m increase in investment for Legal Services was to support the continuing demand for childcare cases. Previously, efficiencies had been used to offset demands in the Legal Team, but this was no longer possible with the scale of increased demand within these services. Worcestershire Children First (WCF) would continue to work on early intervention and prevention and no reductions were anticipated in this area. It was likely that the Public Health Ring Fenced Grant (when received) would increase by the rate of inflation and there would be further investment into front line services for adults and children’s care.
• As a result of successful investment performance of the Pension Fund, the Council’s contribution hadreduced from 22.3% to 19.4%, resulting in a significant saving of £4.464m for the Council.
• In relation to the proposed move to introduce a standardising ‘vacancy factor’ (ie holding vacancies wherever possible) of 6.5% for all staffing budgets there is a savings target of £184,000 for CoaCh. It was however noted that this would be challenging for some areas.
• It was confirmed that every library (except the Hive) was being considered as part of the roll out of libraries unlocked, although it may not be appropriate for every library. The savings target for this initiative was £225k. The proposals relating to Redditch Library were not detailed in this Budget Report due to the funding being provided by external funds and also the consultation had not yet closed.
• In response to a question on whether, in respect of the Arts, the Public Health Ring Fenced grant would be devolved to Severn Arts, the Panel was advised that the contract with Severn Arts was due for renewal and there was no appetite to consider any other alternative for delivery as Severn Arts were doing a great job.
• The Strategic Director for CoaCh confirmed that the revenue savings and income generation targets for CoaCh were achievable.
• There was a £800k target to maximise income generation across the County Hall Campus which would be achieved by leasing parts of County Hall.

·         A Member questioned how fluctuations in inflation would impact on the Council’s Medium Term Financial Plan. It was explained that fluctuations’ in inflation were taken into account during contract negotiation and would be monitored accordingly.

The Panel was keen to look at the individual budgets within its remit and to scrutinise through Quarterly Budget Monitoring during 2023/2024 year with a view to feeding into the 2024/2025 budget process starting in September 2023.