Agenda item

Report of the Budget Task Group and its appendix

·         Appendix - Guidance related to the scrutiny of the precept by Police and Crime Panels.

The West Mercia Budget 2017/18 and the Medium Term Financial Plan 2017/18 – 2020/21

·         Appendix - Budget Consultation 2017/18 summary

The Police and Crime Commissioner (PCC) gave a presentation regarding the 2017/18 budget proposals, Capital Programme and Medium Term Financial Plan. (2017-2021).

The PCC expressed his thanks to the OPCC Chief Executive, OPCC Treasurer and police force for the support given to him since his appointment to office.

In terms of spending the policing budget, the PCC made the following main points:

·       The total budget of £212.2m included an increase of £4.5m for investment in modernising and reforming the policing service

·       There would be an additional investment £1.3m to protect the most vulnerable people

·       Investment in increasing officer visibility in communities was a priority

·       There would be a  freeze in the policing element of the Council Tax

·       Financial reserves would be used effectively and responsibly.

The total budget of £212.2m was made up of funding from a Central Government Grant of £120.2m (reduced by just under 1% since last year) and £82m from Council Tax.  The priorities for deploying these funds were:

·       Putting victims and survivors first (£100,000 in restorative justice services, adding £1m to the Government Grant for victim services and developing specialist services for the most vulnerable people)

·       Building a secure West Mercia (an additional £1.3m for protection of vulnerable people (moving and increasing policing capability) £0.2m for Digital Forensics, £0.1m for drugs testing by roads policing, £0.1m to support the Multi Agency Safeguarding Hub's (MASH) and £0.1m for Regional Intelligence)

·       Reforming West Mercia (an additional £1.2m revenue funding for the Transformation Programme (including ICT), Capital investment of £20.8m in ICT (including mobile working, SAAB, Athena), additional £1m revenue funding for Estates (for backlog maintenance),capital investment of £36.2m in Estates (including OCC, Firearms Range, Hereford, Shrewsbury)

·       Reassuring West Mercia Communities. (Investment in mobile technology to improve police community visibility, continue to invest £1m a year in the Police and Crime Investment Fund, invest in body worn video costing £0.5m a year revenue).

The PCC drew the Panels attention to the Treasurer's Report on pages 4 and 5 of the West Mercia Budget 2017/18 and the Medium Term Financial Plan (MTFP) 2017/18 – 2020/21 and in doing so highlighted in particular paragraphs k) and l) which were different to other years in that they  asked the Chief Executive and the Treasurer work with West Mercia Police to develop plans to deliver the savings targets outlined in the Strategy (the Panel would be encouraged to have a role in scrutinising this work) and also to work with the Chief Constable to develop a revised Corporate Strategy planning process.

Paul Middlebrough, Chairman of the Budget Task Group, which looked at the proposed budget, MTFP and the Policing Plan, introduced his report on the proposals. He thanked the other members of the group as well as Sean Pearce, Worcestershire County Council's Chief Financial Officer, for assisting them.  Reference was made to the Task Group's report that had been circulated as part of the Agenda papers.

The PCC's Chief Finance Officer had outlined to the Task Group the financial risks and the reserves strategy. Balances would reduce from £50.6m at 1 April 2017 to £19.8m at 31 March 2021. The minimum level of balances recommended was £14.5m. The income foregone from not increasing the precept in 2017/2018 was £1.5m per year and the MTFP assumed future annual increases in the precept.

The four main financial themes explored by the Task Group were:

·       The opportunity that may be foregone from not raising the precept in 2017/18 in line with the increases that have been levied in previous financial years

·       The deliverability of the budget in the context of a significant savings requirement in 2017/18 based on the budget pressures and savings set out in Section 5 including those that were intended to be delivered through invest to save schemes such as the PCC's Digital Strategy

·       The Medium Term risk presented by the Home Office review of Police Funding and the reserves carried for the future impact from any changes to funding methodologies; and

·       The extent to which future increases in interest rates may increase the costs of borrowing that need to be undertaken to deliver significant capital investment over the MTFP.

During the discussion with the Commissioner, issues were addressed arising from questions about investment in premises in Shrewsbury and Telford, rural policing, mental health, communication blackspots and balancing policing resources as some parts of West Mercia see greater demographic growth than other areas.

The Task Group recommended that the Panel approved the precept recommendation for 2017/18.

During the discussion the following main points were made:

·       In response to the question from the Chairman about the risk of inflation, especially on pay, the PCC advised the Panel that with the economy looking to continue to grow, there may be some upward pressure on pay inflation. This was starting to look increasingly possible within the life of the plan. In the Autumn Statement in 2016, the Chancellor estimated that inflation would rise to 2% a year in future years.  The MTFP included a provision of 1% for pay. The Treasurer was therefore recommending that a provision equivalent to a 1% increase in inflation in a year be held amounting to £1.9m

·       It was confirmed that cost of the Police Federation was paid for by the contributions of individual members

·       Reassurance was given to the Panel that West Mercia Police were compliant with all national wage regulations and would continue to be

·       The PCC acknowledged the importance of value for money in terms of the plans for ICT and confirmed that he was taking a personal interest in this area of investment

·       Although not strictly a matter of concern for the West Mercia PCC, he was confident in the robustness of the reserves policy of the Warwickshire PCC as Alliance Partner and in fact both PCCs shared the same Treasurer

·       The PCC confirmed that there were no plans to close any police stations as part of the £36.2m improvement to Estates; there would however be no single use police buildings

·       For a number of years, there had been a plan to update the Firearms Range. Historically, the Range had received national recognition and was a valuable income stream. Unfortunately, the Range was no longer fit for purpose and the facilities required investment to bring them up to date.  Given that the requirements for the size of the Range and facilities required had changed significantly and that there was some national specialist capabilities work going on, the PCC would wait for the results of this work and then agree the upgrade strategy with a view to return to being a provider with national recognition and having an income stream once again

·       Vehicle Procurement for West Mercia was done in conjunction with Warwickshire and also as part of a national framework in order to ensure best value

·       There was also some investment planned for vehicle telematics to ensure more efficient use of police vehicles

·       There were no plans for every police officer to be equipped with Body Worn Video; they would be allocated in a prioritised way

·       Digital coverage was difficult in some areas of West Mercia and was unlikely to be available in all areas but would be available wherever possible as would Wi-Fi

·       The relocated Herefordshire Police Station (with the Fire Station) was likely to be open by 2020

·       The capital works for the shared police station and fire station in Peterchurch, Herefordshire was nearing completion

·       In response to the concern about the increase in rural crime, the PCC confirmed that he was committed to making rural crime part and parcel of policing, rather than a stand-alone initiative

·       The position of Transformation Director was due to be advertised externally; meanwhile an interim officer had been appointed to the post.

The precept proposal recommended to the Panel was to freeze the precept at the existing 2016/17 level. 

Following consideration and full discussion by the Panel, having taken account of the PCC presentation and the responses provided by the PCC and his officers to questions from the Panel, and the work of the Budget Task Group, the Panel unanimously supported the PCC proposal to freeze the precept for 2017/18 as set out in the report.