Agenda item

The Cabinet considered the 2017-18 draft Budget and Council Tax for recommendation to Full Council. The details were set out in the report and its Appendices.

In the ensuing discussion, the following main points were made:

·         The Leader of the Council introduced the report and commented that:

Ø  the final budget settlement took account of the provisional local government settlement, consultation and information from District Councils in relation to Council Tax collection and Business Rates. There may be some last minute changes to the figures from Government

Ø  The budget included proposals to close the £2.9m financial gap for 2017/18

Ø  There were additional pressures for example home to school transport for special educational needs children and additional resources for safeguarding children

Ø  It recommended that Council Tax should be increased by 2.94% (2.0% for Adult Social Care precept and 0.94% to fund delivering outcomes). This represented only a small increase on a Band D property. The County Council remained one of the lowest Council Tax precepts in the country

Ø  It reaffirmed the commitment to investments - £1m for roads, £6m over two years for pavements, £5m to cut congestion and £2m to complete town centre improvements, £1.5m for work on the A38 and the Southern Link Road

Ø  Children's Safeguarding – An extra £800k to augment the previously proposed £700k as well as two x £1m investments and some capital investments

Ø  Adult Social Care - £9m new investments including the £2.4m grant from the Government. However this grant was not guaranteed for future years and the Council's concern about this would be made to the Government

Ø  The Budget addressed the issues highlighted by the public including congestion, road/pavement improvement, and vulnerable children and adults 

Ø  The building of new housing had led to a £4.5m increase in income and a one off payment of £2.5m through the Collection Fund

Ø  He thanked OSPB and the Budget Task Group for their suggestions to close the financial gap. These suggestions were not applicable for 2017/18 but were worthy of consideration for 2018/19

Ø  In summary the budget responded to the views of the public, and invested and grew the local economy. It was acknowledged that there was a medium term financial gap to address in the future 

·         This was a balanced budget that reflected the policies in the Corporate Plan. The consultation had been very useful. A further £0.6m earmarked reserve had been allocated to the Divisional Fund Scheme which guaranteed the scheme for the next 2 years. There remained the fairer funding anomaly and the Council was determined to ensure that the County received its fair allocation of funding from the Government. £0.3m had been added to the Transformation budget to ensure that the Council operated in a way that it could afford to in the future. The New Homes Bonus allocated different amounts of money between the district councils and County Council and the Government would be lobbied to ensure consistent and fair funding for the future 

·         The budget was sound and legally robust. The Government Grant and precept and Medium Term Financial Plan helped to provide a degree of certainty around the funding of Adult Social Care, but there remained uncertainty about funding for the Independent Living Fund, the Care Act Prisons Funding and the Better Care Fund

·         The Council had started its consultation process earlier than usual and consulted 55,000 people. One of the emerging themes was to encourage people to do more for themselves and realise their aspirations for example through volunteering and doing things differently. Partner organisations had been consulted including the voluntary and Community Sector, town and parish councils, schools, local businesses, and unions. Their comments related to closing the financial gap, divisional funds, footpaths, additional resources for Children's Social Care, economic development, innovation centres, changes to Worcestershire Regulatory Services and the level of precept. As part of the FutureFit savings the Council had worked with the DWP to provide office space in Redditch and Kidderminster Libraries to help sustain the countywide library service

·         The Leader of the Council indicated that the feedback from the budget consultation process with partner organisations would be made available to all councillors prior to consideration of the Budget at Council

·    Following the recommendations of the Children's Safeguarding Board, the Council had responded to this important area by investing an extra £800k in the Children's Safeguarding budget to make a total of £1.5m worth of investment. This investment would be for social work activity to improve practise and service rather than increase placements. A further £1m revenue investment and £1m capital investment had also been included 

·         The Chief Financial Officer, his team and other officers who had contributed to producing this budget should be thanked for their efforts

·         The OSPB had brought forward some useful suggestions for the budget for the future particularly in respect of sale and lease back of Council property and "Revolving Door" investment in the County. The suggestions around smallholdings were puzzling given the scale of the issue in comparison with the other major issues facing the Council. The Leader of the Council emphasised the limited corporate resource available and the need to focus on the most important areas

·         Worcestershire Parkway Station had been granted ministerial approval and therefore work on the station was pressing ahead. The comments from OSPB were welcomed particularly improved consultation with highways officers which was uneven at present and greater involvement of the agricultural community in the maintenance of footpaths

·         The Chairman of the OSPB introduced the key messages from the budget scrutiny and thanked the Leader of the Council, the Chief Executive, the Chief Financial Officer and his team for their support in preparing the report. The findings were unanimous as anything without consensus support was not included. The Task Group agreed that the budget was legal and robust. The Group suggested investigating the sale and lease back of Council property. It was accepted that the suggestions would be for future years. There was no agreement on Council Tax therefore no recommendation was included in the report. OSPB would support the Cabinet Member for Children and Families to ensure following the Ofsted Inspection that funding was appropriate for children safeguarding and to assist in future years. OSPB accepted its own responsibility in holding the executive to account. The Council's commissioning programme would be scrutinised to give assurance to the Council Tax payers that the Council was not being exploited.  The suggestion for the Council's smallholdings related to better uses of resources rather than their disposal. More member scrutiny work was required but more scrutiny officer resource was needed to support that work

·         A Member from outside the Cabinet expressed concern about the Council's ability to absorb cuts and the proposals to increase Council Tax. In particular the consequences of the ceasing of the Revenue Support Grant were immense and the Leader of the Labour Group offered to accompany the Leader of the Council to lobby the Government on this matter. The Leader of the Council responded that the Budget struck a balance between increasing Council Tax to protect services for vulnerable people and the ability for people to pay the increase. There was an opportunity to lobby the Government because there remained uncertainty about the future of the Grant and Adult Social care funding, particularly on the needs review and he welcomed a cross-party approach

·         A Member from outside the Cabinet commented that the lateness of information made it difficult for non-Cabinet members to put forward proper proposals. The consultation was welcomed but notification of the feedback would have been beneficial. Cross-party lobbying of Government was also welcomed and members should be kept informed of progress. The Council was not making best use of the intellectual property of the organisation. The Leader of the Council responded that unfortunately specific Government Grants were received very late. As soon as information was available, it was disseminated and the budget information had made available as early as November 2016

·         The Chief Financial Officer updated Cabinet on the following issues:

Ø  Government Grants – This was now £7m. However final guidance on the Better Care Grant had not been received – the provisional amount of £30m was expected to remain but the restrictions on how it could be spent were not known

Ø  All district council tax rates had been received as set out in the report. Business rate notification had just been received and early indication was that they were as reported

Ø  The Local Government Financial Settlement had not been received yet

Ø  The consultation exercise had provided valuable feedback into the budget process

·         The Leader of the Council undertook to arrange for the consultation feedback to be circulated to all councillors as well as any information about the financial settlement from the Government. If the financial settlement was in the Council's favour, he would commit any additional resources to Adult social Care. 

RESOLVEDTO RECOMMEND TO COUNCIL: that

(a)          the conclusions set out in the report concerning revenue budget monitoring up to 30 November 2016 be endorsed;

(b)          the virement and transfers to Earmarked Reserves in paragraph 20 be endorsed;

(c)          the budget requirement for 2017/18 be approved at £318.478 million including a transfer from earmarked reserves of £5.185 million;

(d)          the Council Tax band D equivalent for 2017/18 be set at £1,155.31 which includes £44.05 relating to the ring-fenced Adult Social Care precept, and the Council Tax Requirement be set at £236.204 million;

(e)          consistent with the provisional Local Government Finance Settlement that revenue cash limits be set for each Directorate:

*Public Health services are funded by a £0.1 million budget as above plus a £29.9 million specific grant.

(f)           the Council's Pay Policy Statement is recommended for approval as set out in Appendix 8;

(g)          the conclusions set out in the report concerning capital budget monitoring up to 30 November 2016 be endorsed;

(h)          the capital programme as set out in Appendix 9 be approved;

(i)            that £10 million be added to the Capital Programme to support the overall A4440 Worcester Southern Link Road improvements;

(j)            the Medium Term Financial Plan as set out in Appendix 10 be approved;

(k)          the Treasury Management Strategy set out in Appendix 11 be approved; and

(l)            the Statement of Prudential Indicators and Minimum Revenue Statement as set out in Appendix 12 be approved.

RESOLVED: that

(m)         delegated authority be given to the Leader of the Council to recommend to Full Council, in consultation with the Chief Financial Officer, any further adjustments to the revenue cash limits in (c) and (e) above as a result of Central Government confirming the final Local Government Finance Settlement, Council Tax and Business Rates Income,  and associated Specific Grants for 2017/18;

(n)          delegated authority be given to the Cabinet Member for Children and Families, in consultation with the Director of Children, Families and Communities, to approve the decision on the new Early Years Single Funding Formula (EYSFF) and Early Years provider rate;

(o)          delegated authority be given to the Chief Financial Officer, in consultation with the Leader of the Council, to allocate funding to specific projects within the Revolving Investment Fund (RIF), subject to satisfactory business case completion, financial and operational due diligence advice from the RIF Investment Board. Details of decisions made will be published on the County Council's website as part of the Record of Officer Executive Decision process; 

(p)          the Director of Adult Services and the Director of Children, Families and Communities be authorised to finalise the details in respect of their Directorates and formally execute the Section 75 agreement for Commissioning arrangements with Health for 2017/18;

(q)          delegated authority be given to the Director of Economy and Infrastructure, in consultation with the Cabinet Member for Economy, Skills and Infrastructure to allocate capital projects within the £2 million Town Centre Improvements programme and the National Productivity Improvement Fund. Details of decisions made will be published on the County Council's website as part of the Record of Officer Executive Decision process; and

(r)           delegated authority be given to the Director of Economy and Infrastructure in consultation with the Cabinet Member for Highways  to allocate funding to specific projects with respect to the £5 million Cutting Congestion programme, the £6 million investment into Footpaths and Pavements, and the Pothole Action Fund. Details of decisions made will be published on the County Council's website as part of the Record of Officer Executive Decision process.