Agenda item

2019/20 Council Fund Budget: Updated Forecast and Stage 1 and 2 Budget Proposals

To advise of the latest position on the 2019/20 budget  and to approve the stage 1 and stage 2 budget proposals.



(a)       That the Stage 1 and Stage 2 budget proposals be approved; and


(b)       That the proposed campaign be supported and that Council makes a formal response to the Welsh Government on the Provisional Welsh Local Government Settlement.


The Chief Executive introduced the report to advise on the latest position on the 2019/20 budget.  Council was invited to approve the Stage 1 and Stage  2 budget proposals and to make a formal response to the Welsh Government (WG) on the Provisional Welsh Local Government Settlement which was out for consultation.  Members were also being asked individually and collectively to support the #BacktheAsk campaign for fairer funding for local government and for Flintshire.


The Chief Executive advised that Stage 1 of the budget addressed Corporate Finance and Stage 2 addressed Service Portfolios.  Stage 3, which was to follow, would address national solutions and balancing the overall budget.


The Chief Executive and Corporate Finance Manager gave a joint presentation which covered the following key points:


·         Local budget forecast and our funding position

o   update on national budget position

o   Chancellor’s UK Budget Statement

o   budget forecast 2019/20

o   updated budget forecast 2019/20

o   funding gap make-up pre-settlement

o   MTFS budget setting approach

o   the context for local decision making

o   the position we are in

·         Stage 1 – Corporate Finance 

o   Stage 1 – corporate budget solutions

·         Stage 2 – Service Portfolios

o   Stage 2 summary of portfolio business plan proposals

·         National budget position and Stage 3 of  budget-setting

o   summary of the Welsh budget position

o   National funding versus Council Tax

o   Council Tax analysis

o   balance of RSG and Council Tax income

o   workforce sessions feedback

o   #BacktheAsk - campaigning position

o   #BacktheAsk - messages of support

o   #BacktheAsk - Council Tax

o   #BacktheAsk - public debate

o   #Our Day - 20 November 2018

o   next steps and timelines 


Councillor Aaron Shotton, thanked the Chief Executive, Corporate Finance Manager, and Chief Officers, for their hard work on the 2019/20 Council budget.  He commented on the need to agree Stages 1 and  2 of the budget and said he hoped there would be unanimous support from  Members for the proposals which had been consulted on through the Overview and Scrutiny process.  He  referred to the efficiencies proposed, as detailed in Stages 1 and 2 of the budget report, to contribute to closing the ‘gap’,  and commented there had been a further call on the Council’s reserves in its strategy to defend services during austerity. Although this  budget included an illustrative 4.5% increase in Council Tax, and a further £250K reduction in senior management costs, there was still a significant gap to make-up. 


Councillor Shotton commented on the move from national funding to Council Tax funding  to support local government services and,  whether  intended or not as a policy this  was a reality in England and Wales.  He said this was a cause of significant concern and commented that the possibility of increases in Council Tax up to around 15% was not what the Authority wanted and was what we must campaign against with improved national funding.


Councillor Shotton moved the recommendation in the report that Council approve Stage 1 and Stage 2 of the budget .proposals.   He also referred to the second recommendation in the report and spoke of his pride in the #BacktheAsk campaign which had been launched today. Wide ranging support for the campaign was encouraged in conjunction with the Local Government Association ‘Our Day’ campaign.  He continued that the #BacktheAsk campaign was not unrealistic as it was seeking currently unallocated  funding from the WG to be passed to local government to ease the financial pressures.  He commented on the positive discussions which had taken place with WG, in conjunction with the Welsh Local Government Association (WLGA), and said he was hopeful that the First Minister and the WG recognised that local government should be first in line for additional funding following the Chancellor’s budget statement. Councillor Shotton emphasised the importance of continuing to campaign collectively to protect services and the residents of Flintshire from further austerity measures.


Councillor Chris Bithell also commented on the shift from national taxation to local taxation to close the gap created by reductions in national government funding.  He commented on the cost for policing and the assumption in national government that 51% of funding would be imposed on local tax payers.  He continued that moving the responsibility for funding for police and crime and local government services to local council tax payers had been ongoing for a number of years and was viewed by many as taxation by stealth.  He expressed the view that this practice was unfair and unacceptable and residents needed to be made aware that local taxation would not provide the same level of services that were funded by national taxation.  Council tax was being increased but less services were being provided across councils. 


Councillor Mike Peers supported the statement that the Provisional Local Government Settlement, which was out for consultation, was grossly inadequate to meet need.  He suspected that the WG was holding large funds which could be passed to local authorities to ease financial pressures and supported the #BacktheAsk campaign for fair funding for local government and for Flintshire.  He expressed a concern that there was an imbalance in the provisional settlement between local authorities and commented on a “north/south divide” in terms of funding.  He emphasised the need for adequate funding in Wales to be provided for basic services and said local council tax payers should not be asked to subsidise the shortfall in national funding proposed by the WG.  He said he fully supported the comments which had been made by Councillor Chris Bithell.  He referred to the budget ‘gap’ of £15.3m and thanked all involved for their hard work to reduce the ‘gap’ to the current £6.7m. 


In conclusion Councillor Peers spoke of the need to engage the support of local and North Wales Assembly Members for the campaign for fair funding to deliver local services.  He stated that raising Council Tax was not an efficiency but was income generation at the expense of the general public, and was not fair or appropriate.


Councillor Patrick Heesom concurred with the views expressed that Council Tax as a solution to the problem of inadequate government funding was  not appropriate.  He said that any increase above a 4% or 5% rise in Council Tax would be unacceptable to the public and stated it was regressive and undermined the principle of a fair society.  He commented on the context for local decision making and said he did not agree with the statement that the mandatory versus discretionary debate had limited value.  He also commented on the reference to major transformational change and queried whether the current Medium Term Financial Strategy had any value.   He said there was a need to rethink the current strategy as he felt it did not meet current or future pressures and was no longer fit for purpose.


Councillor Carol Ellis said she supported the #BacktheAsk campaign and reiterated the comments expressed by Councillor Mike Peers that there was a need for Assembly Members to give their support to the campaign for fair funding.  She referred to the recommendation to increase Council Tax to 4.5% and said  this did not include the Town and Community Council and Police and Crime Commissioner precepts which would increase the rise to a minimum of 7%.  She said there was a need to raise public awareness of the Council Tax versus WG funding.


Councillor Richard Jones commented on the funding to the Health Service which had received a 5.2% (£315m) increase this year and said £95m was being allocated to pay awards in Wales.  He referred to the balances provided on the RSG and Council Tax income which had been provided in the presentation and said there had been a 1% increase in the figures each year.  He gave an example of the impact of continued rises and the effect on the budget for the revenue account in future years and said as much as a third of the budget would be provided from local taxation (32% - an increase of £23m).


Councillor Richard Jones referred to the budget gap of £6.7m and said that the #BacktheAsk campaign asked for £5.6m (a shortfall of £1.1m). He asked for clarification of the calculations on the gap and on the calculations on Council Tax. 


Councillor Jones referred to the Housing Revenue Account (HRA) and asked if there was a means of recharging the cost of Members’ salaries to the HRA account for the time that Members allocated to addressing housing issues.


Councillor Jones referred to the 9% reduction in the support/subsidy that the Authority provided to  Aura Leisure & Libraries, and asked if there was a possibility of reducing the support further  to achieve additional savings. 


Referring to page 73 of the report, Councillor Jones  queried the figures provided for Planning and Enforcement (£0.111m) and Housing and Assets (£0.035). 


Councillor Jones asked if he could also be provided with the information requested in response to the questions he had raised at the last meeting of the Corporate Resources Overview & Scrutiny Committee meeting.


The Chief Executive explained that detailed analysis would be provided to Councillor Jones in response to his questions on the Housing Revenue Account and transport matters.  Referring to the suggestion from Councillor Jones that the Authority considered further reducing the support it provided to Aura Leisure & Libraries and Newydd Catering & Cleaning Services, the Chief Executive advised against this as it would   seriously impact on the business plans of both companies and commented on  the cost pressures which had already been absorbed by both e.g. pay awards.  Referring to the HRA the Chief Executive advised that some costs were charged for democracy services but this could be looked at again in more detail. The Chief Executive provided further clarification on the differential between the £6.7m budget gap and the £5.6m asked for in the #BacktheAsk campaign and, whilst acknowledging that this was not sufficient to bridge the gap before Council Tax, he explained the rationale taking into account the  WG unallocated funding which was available.  


The Corporate Finance Manager explained that the HRA was recharged for central support costs and cited human resources, finance, legal, corporate management costs, and Member involvement as examples.  The Chief Executive commented that the recharges were applied on a fair calculation.


Councillor Kevin Hughes spoke of the need for ongoing collective  support of the #BacktheAsk campaign until local authorities received a fair deal from both the national and Welsh Governments.


Councillor Glyn Banks congratulated the Chief Executive and Corporate Finance Manager on the report and the presentation provided.  He said he could not support increases of up to 15% in local council taxation for the residents of Flintshire whilst the WG had large funds which could be passed to local government. 


Councillor Hilary McGuill said there was a need to raise greater  awareness of how the general public could support the #BacktheAsk campaign and said the online petition was not easy to complete.  She commented that  residents wanted the funding which was passported by national government to the Welsh Government to be spent on local services now.


Councillor David Williams asked if public consultation events were being held in local communities and said they had been helpful in the past in raising public interest.  The Chief Executive explained that public attendance at previous events had been disappointing and suggested that it would be best to wait and see what  developed around the #BacktheAsk campaign, the national budget position and Stage 3 of the budget setting, before holding public events.  However, all options were open for consideration.


Councillor Colin Legg congratulated the Leader, Cabinet Members, Chief Executive, Corporate Finance Manager and his team, for their hard work in achieving the skilful reduction in costs.  However, he expressed concern that the reduction in staffing resources meant that the Authority was not able to maintain  the quality of services it wanted to provide for Flintshire’s residents.  He expressed concerns for the well-being of staff and commented on the pressure of increased workload due to reduced staffing resources and said this could cause employees to suffer from stress related illness. 


In his concluding comments the Chief Executive acknowledged the  comments which had been made by Councillor Mike Peers and Councillor Patrick Heesom and said it had not been possible to identify cuts or transformation for next year’s budget on a financial scale beyond what had been done.  He continued that there was no local alternative to a rise in local Council taxation to help bridge the gap next year and emphasised that the Authority had worked robustly to cut costs to protect Flintshire residents from greater increases in Council Tax.  He also commented on the need for public understanding of the other costs included in Council Tax charges  and cited the Fire Authority, Police and Crime Commissioner North Wales, and town and community council precepts.   He emphasised that the funding of local government was a national and not just a Flintshire issue. 


Referring to the comments made by Councillor Hilary McGuill on the  #BacktheAsk campaign the Chief Executive commented on the rising social media interest and said there was a plan for controlled and uncontrolled lobbying. 


The Chair said all Members had a responsibility to ask Assembly Members to give their support to the #BacktheAsk campaign and to raise awareness amongst their local residents and explain the importance of their support being made known to the WG.


The Chief Executive reminded Members that the Authority’s  formal response to the WG on consultation on the Provisional Welsh Local Government Settlement would include the #BacktheAsk campaign and the key themes discussed at the meeting today and would be signed by the Leader and the Chief Executive.  


The Chief Officer (Governance) advised that Councillor Aaron Shotton had moved the recommendations in the report.  The recommendations were duly seconded and on being put to the vote were carried.




(a)       That the Stage 1 and Stage 2 budget proposals be approved; and


(b)       That the proposed campaign be supported and that Council makes a formal response to the Welsh Government on the Provisional Welsh Local Government Settlement.

Supporting documents: