Agenda item

The Panel considered the draft budget for 2023/24 for the areas within its remit relating to the Environment including Net Zero Plans, Highways, Flooding and Waste.

By way of introduction, the Chief Financial Officer made the following main points:

·       Cabinet had agreed the Council’s draft budget for 2023/24 on 5 January and a programme of public engagement would run throughout January.  Comments from the Overview and Scrutiny Panels would be reported to the Overview and Scrutiny Performance Board on 30 January.  The draft budget and comments received would be discussed by Cabinet on 2 February and the budget would be agreed at Council on 16 February.

·       The Local Government Settlement had been announced on 19 December.  It was a one-year settlement and contained net additional grant funding for the County Council of £26.3m.  The Government had also published a policy statement which suggested that core funding grants would increase by inflation in 2024/25 and a funding review was anticipated for 2025/26.

·       In response to a question from the Panel Chairman, it was confirmed that Worcestershire County Council’s settlement was average in relation to other County Councils and this was a good result for the County.

·       It was confirmed that this was the last year of the New Homes Bonus which would be replaced next year by a new ‘Housing Grant’ covering all councils.

·       It was proposed that Council Tax would be increased by 2.94%, plus a 2% Adult Social Care Levy, giving a total increase of 4.94%.

·       Pressures on the budget included inflation and latent demand in some services such as adult and children’s social care and home to school transport.  Additional borrowing would support the capital programme and public transport would be supported by the use of reserves.

·       The proposed increase in Council Tax would mean an average £1.33 increase per week for a Band D household.  The annual cost would be £266 less than the highest County Council and Worcestershire would remain in the lower quartile.

·       Representatives of the County Council would continue to lobby the Government on Fair Funding.

·       In response to a Member’s question, it was confirmed that, if the Council had proposed increasing Council tax by 4.99% (the maximum allowed by Government), this would have raised an additional £152k and meant an extra 70p per year on Council Tax bills for a Band D property.

·       The Council expected that Department for Transport grants would be received by 16 February (the date the Council would set its budget).  Lobbying had been to increase grants in line with inflation but this had not yet been confirmed by Government.

The Deputy Chief Finance Officer summarised the draft budget for areas with the remit of this Panel.  The following points were raised in the ensuing discussion:

·       Members were reminded that the figures in the Cabinet report (included at appendix 2 to the Panel’s agenda report) included areas within the remit of the Economy O&S Panel.  The total budget for areas within the remit of the Environment O&S Panel was £53,759m.

·       The draft budget included a £500k revenue increase for highways maintenance and tree pruning, and a £434k increase in response to increased demand for waste services.  It was suggested that this increase in demand was as a result of more houses having been built and more people working at home.

·       A further £519k was included for pay inflation and £3.631 for contract inflation (including waste).  Further details were given on the investment of £7.4m to rebase budgets to reflect the full cost of waste PFI financing and to remove the use of one-off funding.

·       In response to a question from the Chairman, it was confirmed that the service was confident that current levels of income generation via fees and charges for streetworks would be maintained.  The amount of income generated had increased due to higher prices and an increase in volume of work.

·       In relation to lane pricing, the Strategic Director informed the Panel that a policy paper was currently being refined with a view to bringing it to Corporate Business Board in due course.  The Chairman looked forward to hearing further details at a future Panel meeting.

·       With reference to vacancy management, there was a Council-wide savings target of 6.5% of the overall salary budget.  For service areas within the remit of this Panel, this equated to £981k.  In response to a question about what would happen if turnover of staff was less that forecast, Members were reminded that this target covered the Council as a whole.  If fewer than expected staff left the organisation, managers would be asked to look at alternative ways of making savings.  There was also a buffer in reserves in case the savings target was not met.

·       In terms of reporting lines, a number of staff had moved from the remit of this Panel to that of the Economy O&S Panel.  It was confirmed that data in relation to Public Rights of Way would still be considered by the Environment O&S Panel as part of quarterly performance monitoring.

·       With reference to contract inflation, it was confirmed that different inflation rates had been used to reflect the different inflationary factors impacting each contract.

·       A question was asked about the budget for Development Management.  It was confirmed that the figures in the agenda report referred to the net budget and the gross budget was significantly bigger.  Most of the budget was offset by income.  It was suggested that, for clarity, in future reports it may be helpful to include a column giving the figures for the gross budget.

·       The Chairman agreed that it would be helpful to see the full cost and actual number of employees for each service, details that had been considered in previous years via a budget task group.  This had not been possible this year due to the late arrival of the Local Government Settlement.  He hoped that it would be possible to have a budget task group in future as this approach gave a greater understanding of each department’s budget.

·       It was confirmed that the £14k savings in Road Lighting would be achieved as a result of vacancy management and energy savings from the ongoing LED conversion programme which was scheduled to be completed by June 2023.  The Assistant Director for Highways and Transport Operations confirmed that a trial of solar power for streetlights (and other highways uses) was ongoing and the Panel would be provided with an update when available.  It was confirmed that all LED lights were switched on for the hours of darkness.

·       The currently approved capital programme for the Environment totalled £174m.  It was confirmed that the Pavement Improvement Programme was in addition to funding available for maintenance.  It also excluded contributions from local members.

·       Members were reminded that the use of solar power and other renewable energy infrastructure by the Council would be part of the corporate budget via property services.  The Council acted as the administrator of grants to business to improve energy efficiency.

·       The Panel was informed that the draft budget for areas within the remit of the Economy O&S Panel was similar in that it included investment in relation to contract and pay inflation and a target for vacancy management.

The Chairman summarised the discussion as follows.  The Panel felt that this was a good budget for the environment and for Worcestershire and welcomed the unexpected additional grant funding from central Government.  Members also welcomed the Cabinet’s continued commitment to funding the Pavement Improvement Programme, flood mitigation measures and LED street lighting.

However, concerns remained about particular service areas which the Panel had identified through its quarterly monitoring of performance information, including Public Rights of Way and the backlog of Definitive Map Modification Orders (DMMOs), and issues relating to Section 278s.

Overall, the Panel welcomed the budget proposals.  Looking forward to 2023/24 budget scrutiny, the Chairman requested that a budget task group be set up to allow more in-depth consideration of proposed budgets.  The Chairman thanked the Cabinet Members and Officers for their help and assistance.