Agenda item

As detailed in the recommendations.

The Chief Executive introduced the updated Medium Term Financial Plan (MTFP) 2014/15 to 2018/19 which also set out key dates in the budget planning process for 2014/15. 

The Head of Finance outlined that the second revision of the MTFP set out the financial position on the best known information available as at 30 September which identified a budget gap to be met from efficiencies of £16.5m in 2014/15 and £47.8m over the coming five years.

Since the paper had been finalised the draft Welsh Government (WG) budget had been announced on 8 October 2013 and the provisional local government settlement was expected to be received on 16 October 2013.  The prospects around the level of funding that would be available to local government in 2014/15 had worsened considerably in recent months and potentially could get worse.  It was likely that when the settlement was received it would not include details of specific grants, details of which may not be known until the New Year. 

The Head of Finance went on to set out the assumptions of the MTFP about inflation, investment in services experiencing demand and the follow through of costs and efficiencies in the current year.

The outcome of the provisional settlement and updates to costs and efficiency measures would be incorporated into revisions to the financial forecast which would be ongoing over the coming months as part of the budget process for 2014/15.

The Chief Executive then went on to set out the organisational change strategy to meet the efficiency and savings targets.  The projected revenue gap of approximately £50m over the five year period to 2018/19 would result in the Council undergoing a major structural review consisting of:

·        Corporate Efficiency: assets, customer, finance and procurement;

·        Functional Efficiency: value for money in all service and support functions;

·        Organisational Design – Structure and Operating Models: functional and structural design including service alignment and management structures, Council and service operating models and alternative delivery models;

·        Organisational Design – Workforce: workforce planning, phased workforce reduction, vacancy management and costs of employment

There would inevitably be services changes and consultations would take place on services such as libraries and leisure.

The organisational change strategy would require strong, positive and effective leadership and governance, programme management and investment capacity and capability.

The Flintshire Futures Programme with its four sub-programmes of (1) corporate change (2) service review led functional change (3) regional collaboration and (4) local collaboration had been successful to a point in changing and improving the organisation however it was not of a scale to meet the changing financial challenge.

The Chief Executive emphasised the scale of the challenge facing the Council.  Detailed work would take place with Members, officers and external consultants for specific selective areas, where required.

The Head of Finance explained the timetable of the budget planning process for 2014/15, details of which were in the report.  Regular update reports would be submitted to Cabinet on revisions to the forecasts.

RESOLVED:

(a)       That the Medium Term Financial Plan 2014/15 to 2018/19 as at 30 September 2013 be received;

(b)       That the Medium Term  Financial Plan 2014/15 to 2018/19 be referred to Corporate Resources Overview and Scrutiny  Committee on 14 November 2013 for consideration and to provide feedback to Cabinet;

(c)        That the approach of bringing revisions to the forecasts within the MTFP to Cabinet on an ongoing basis over the coming months as part of the budget process for 2014/15 be supported; and

(d)       That the key dates in the budget planning process for 2014/15 be noted.