Agenda item

Consideration was given to a report of the Director of Finance which provided the Select Committee with the forecast budget gap and the Administration’s budget proposals for 2019/20 together with forecast budget gap estimates for the period 2020/21 to 2023/24, having regard to the Provisional Local Government Finance Settlement published on 13 December 2018.

 

The Cabinet Member for Finance and Corporate Resources and the Director of Finance presented the report and addressed the enquiries of the Select Committee.

 

The report set out proposals for the Council’s Revenue Budget for 2019/20 and Medium Term Financial Strategy for 2019/20 to 2021/22. It advised Members of the key financial challenges and issues which would be faced by the Council over the forecast period and set out the Administration’s revenue budget proposals for 2019/20 together with updated budget gap estimates for the period 2020/21 to 2023/24.

 

The report highlighted policy announcements and implications which arose from the Chancellor’s Autumn Budget Statement and the Provisional Local Government Finance Settlement. The report also detailed key budget adjustments and expenditure pressures which underpinned the forecasts that provided the backdrop for the Council’s Medium-Term Financial Strategy.

 

Based on the latest estimates, the budget reduction requirement for 2019/20 had increased from the previously reported figure of £17.986m to £22.696m. This increase was due to a range of changes to the estimates which ware set out in detail in Section 11 of the report. Section 12 of the report detailed the Administration’s budget reduction proposals. There were a total of 35 proposals delivering savings of £7.829m in 2019/20. If approved in full, these proposals further reduced the budget reduction requirement to £14.867m for 2019/20. Section 13 explained the approach to balancing the 2019/20 budget. In order to remove the requirement for further spending reductions, it was proposed to part-finance the 2019/20 budget by using the opportunities provided by the ability to use Capital Receipts to support spending on transformational projects up to a value of £3.000m and from an available Collection Fund Surplus of £2.269m. A number of specific and corporate reserves would be used to address the balance.

 

Approval of the proposals set out in this report in full by Budget Council would deliver a balanced revenue budget for 2019/20. The budget reduction requirement for subsequent years was forecast to be £22.883m for 2020/21, £10.889m for 2021/22, £6.859m for 2022/23 and £4.160m for 2023/24.

 

Members sought and received clarification on the change to the amount of business rates expected. They were advised that this anticipated the expected change in the retention scheme in 2020/2021.

 

The Select Committee examined each of the budget reduction proposals as follows:

 

 

The Cabinet Member for Health and Social Care and the Managing Director, Community Health and Social Care Services (DASS) were in attendance to address the enquiries of the Select Committee on the following items:

 

HAS-BR1-237 Day Care Services

A proposal to re-render the service to a different provider. There would not be a reduction in service to service users.

 

HAS-BR1-238 Community Transport

Members asked for and received further information in relation to the services that were provided and the impact on service users of withdrawing the grant. They were informed that the organisation would need to consider its business case in relation to the ongoing provision of services.

 

The Select Committee requested that further information on this proposal and its impact be obtained for consideration by the Cabinet.

 

The Cabinet Member for Neighbourhood Services and the Director of Environmental Services were in attendance to address the enquiries of the Select Committee on the following items:

 

PPL-BR1-209 Reduction in budget supporting North West in Bloom

Members enquired whether there was a role for the Districts to assist in forming a route and were informed that this could be considered, along with assistance from community groups.

 

PPL-BR1-212 Charge for full-length kerbs in designated areas

Members were informed that there would be an increased fee for those that wanted this provision and areas had been identified in each of the cemeteries.

 

PPL-BR1-213 Reduction in Administrative Support

Automating processes had enabled efficiencies that meant the service could operate with one less post.

 

PPL-BR1-214 Reduction in maintenance costs following purchase over hire

Savings would be achieved through the purchase of fleet and equipment rather than hiring. 

 

PPL-BR1-217 Fleet Management

Savings would be achieved through covering seasonal variance by the retention of vehicles from the old fleet rather than hiring vehicles.

 

PPL-BR1-218 Highways IT and mobile working savings

Automating processes had enabled efficiencies.

 

PPL-BR1-208 Increase in Pest Control income/fees

The increased income would be achieved through and increase in the number of contracts delivered. There would be no increase in fees.

 

PPL-BR1-207

The revised standards would reduce the costs of testing.

 

The Cabinet Member for Neighbourhood Services and the Head of Strategic Assets and Facilities Management were in attendance to address the enquiries of the Select Committee on the following item:

 

PPL-BR1-233 Additional Bus Lane Enforcement

Members noted that this was not a proposal for additional bus lanes but to enforce the restrictions on those that were already there.

 

The Leader of the Council and Cabinet Member for Economy and Enterprise, and the Head of Strategic Assets and Facilities Management were in attendance to address the enquiries of the Select Committee on the following item:

 

PPl-BR1-202 Property Savings and Accommodation Review

informed Members of an ongoing number of workstreams that would re-design the corporate estate. Proposals would be brought forward for disposal of certain properties or community value transfers and the identified properties would be reported individually to Ward Members.

 

The Leader of the Council and Cabinet Member for Economy and Enterprise was in attendance to address the enquiries of the Select Committee on the following item:

 

CEX-BR1-252 Corporate Priorities

To reduce the level of non-pay budget held within the corporate priorities budget.

 

The Leader of the Council and Cabinet Member for Economy and Enterprise, and the Director of Legal Services were in attendance to address the enquiries of the Select Committee on the following item:

 

CCS-BR1-226 Constitutional and Civic and Political Support Services Staff restructure

A proposal to delete two vacant posts.

 

The Deputy Cabinet Member for Education and Culture, and the Interim Director of Public Health were in attendance to address the enquiries of the Select Committee on the following items:

 

REF-BR1-201 Oldham Library and Lifelong Learning Services – ICT Services

Revisions in the provision of ICT services enabled a budget reduction.

 

REF-BR1-225 Reduction in library staff budget

Members were informed that there were sufficient volunteers to deliver the Delph library service.

 

REF-BR1-242 Reduction in grants to cultural organisations 

Members suggested grants could be aligned to outcomes in future years.

 

REF-BR1-243 Reduction in Business Support Staff for Oldham Music Services

The service would explore different ways of working.

The Cabinet Member for Neighbourhood Services, and the Interim Director of Public Health were in attendance to address the enquiries of the Select Committee on the following item:

 

REF-BR1-234 Get Oldham Growing

It was noted that this was a difficult decision. Members suggested that officers could work with the Districts to undertake the ambassador roles. It was anticipated that the programme itself would continue.

 

The Cabinet Member for Finance and Corporate Resources, and the Director of Finance were in attendance to address the enquiries of the Select Committee on the following items:

 

CCS-BR1-249 Supplies and Services

Each service would have its budget reduced by 2% and would be responsible for delivering this.

 

CCS-BR1-250 Introduction of vacancy factor

Members were informed that there would be no delay in filling posts that were key of where there was an urgent requirement.

 

The Cabinet Member for Finance and Corporate Resources, the Director of Finance and the Deputy Chief Executive Corporate and Commercial Services were in attendance to address the enquiries of the Select Committee on the following item:

 

CCS-BR1-251 Development of the Unity Partnership operating model Phase 2

The way the company functioned had been considered and opportunities to make additional savings had been identified.

 

The Cabinet Member for Finance and Corporate Resources, the Director of Finance, the Deputy Chief Executive Corporate and Commercial Services, and Assistant Director, Commercial, were in attendance to address the enquiries of the Select Committee on the following item:

 

CCS-BR1-228 Council Traded Services/Unity Commercial Services Reviews

Members noted further savings may be identified.

 

The Cabinet Member for Finance and Corporate Resources, the Director of Finance and the Deputy Chief Executive Corporate and Commercial Services were in attendance to address the enquiries of the Select Committee on the following items:

 

CCS-BR1-253 Corporate and Commercial Services

Members were informed that the staffing review was currently subject to consultation.

 

CCS-BR1-227 Digital by Design

Members queried how much of the service could be digitalised whilst still offering a good service and were informed that, whilst it would not be appropriate to digitalise every aspect, the new infrastructure would enable better access and was a more-stable platform. The public would be able to access the service when convenient to them.

 

CCS-BR1-229 Insurance Review

Members noted this was an additional saving and the contract was due to be re-tendered in April 2019.

 

CCS-BR1-221 Housing Benefit – Reduction in provision for loss of subsidy

The number of recipients of Housing Benefit had decreased, as this was now part of Universal Credit, therefore the number of overpayments had reduced. Members noted this was a saving with no impact.

 

CCS-BR1-222 Audit Fee Reduction

This was an additional saving due to the reduced cost of external audit.

 

CCS-BR1-223 Treasury Management

Members noted this was additional income.

 

CCS-BR1-245 Financial Services Redesign

The service redesign was noted.

 

The Cabinet Member for Finance and Corporate Resources, the Director of Finance, the Deputy Chief Executive Corporate and Commercial Services, and Head of Shared and Collaborative Services, were in attendance to address the enquiries of the Select Committee on the following item:

 

CCS-BR1-247 Transition AVC Contributions to Salary Sacrifice

Members were informed that the ability to pay AVC’s as salary sacrifice, free of tax and national insurance, reduced the Council’s contribution.

 

The Cabinet Member for Finance and Corporate Resources and the Director of Finance were in attendance to address the enquiries of the Select Committee on the following items:

 

CCS-BR1-240 Fees and Charges additional Income

Members sought and received clarification on the following:-

·       Link Centre Room – this was the market rate for the facility.

·       School.

·       School Meals – this service was provided on a cost-recovery basis, Increases in salaries had increased the cost. The last increase had been two years ago and prior to that in 2011. It was not possible to sustain the current deficit, and this was a valued and excellent service.

·       Increase in inter-library reservation fee – this was a large % but small monetary amount.

·       Adoption fee – now similar to the rest of Greater Manchester.

·       Fees for weddings – after a service review, weddings would no longer be conducted on Mondays and fees were therefore set for Tuesdays to Thursdays.

·       Taxi Marshall Levy – this was fully costed and paid for as part of the licensing fee.

 

Options/Alternatives considered:-

·       Option 1 – PVFM accept the assumptions and resulting financial forecasts presented within the report and the budget position at Appendix 2.

·       Option 2 – PVFM propose amendments to the assumptions which will change the resulting budget gap and financial forecasts.

·       Option 3 – PVFM recommend all the budget reduction proposals included in this report to the value of £7.829m for approval and the approach to the use of reserves and balances and as well as Council Tax and Adult Social Care Precept increases.

·       Option 4 - PVFM request that further work is undertaken on some or all of the budget proposals and the approach to reserves and balances and that Cabinet considers a revised position.

 

The Director of Finance confirmed that these proposals constituted a valid budget that could be delivered.

 

RESOLVED that:

 

1.            The national and regional policy landscape determining the context in which the Council was setting its revenue budget for 2019/20 and Medium Term Financial Strategy to 2023/24 be considered and accepted.

2.            The impact of Oldham Council Policies and Strategies on the Council’s budget setting process and the development of its Medium Term Financial Strategy be considered and accepted.

3.            The financial forecasts for 2019/20 to 2023/24 having regard to the Provisional Local Government Finance Settlement and associated funding announcements be considered and accepted.

4.            The key issues to be addressed in continuing to respond to the financial challenges facing the Council be considered and accepted.

5.            The 2019/20 Budget Reduction Proposals at a value of £7.829m be considered and accepted.

6.            The proposed use of £2.946m of reserves for specific purposes and £6.652m of corporate reserves to balance the 2019/20 budget be considered and accepted.

7.            The fees and charges schedule included at Appendix 5 be considered and accepted.

8.            The pay policy statement included at Appendix 6 be considered and accepted.

9.            The proposed Council Tax increase of 3.99% for Oldham Council services resulting in the charges set out at paragraph 17.3 and Table 22 of the report be considered and accepted.

10.         The proposed increase to the empty property premium from 50% to the maximum 100% allowed from 1 April 2019 be considered and accepted.

11.         The proposal to draw on the Collection Fund for major preceptors of £105.824m for Borough Wide services and £92.090m for Council services be considered and accepted.

12.         The proposed budget for 2019/20 for the Council set at £223.939m be considered and accepted.

13.         The revised estimated budget reduction targets of £22.883m for 2020/21, £10.889m for 2021/22, £6.859m for 2022/23 and £4.160m for 2023/24 be considered and accepted.