Agenda item

That the County Council approve the recommendation of the Cabinet from its meeting held on 18 February 2014 as set out in section 9 of the Cabinet report attached to the Council report. 

The Chief Executive and the Head of Finance jointly introduced a report which provided Members with the recommendations of the Cabinet for the Council Fund Revenue Budget 2014/15. 

The Council was informed that at its meeting on 18 February 2014, Cabinet had considered a report of the Head of Finance on the Council Fund Revenue Budget 2014/15 which was attached at Appendix A to the report.  The initial budget proposals considered by Cabinet on 21 January 2014 had been referred to Overview and Scrutiny for consideration.  A summary of the Overview and Scrutiny Committee’s observations and questions, together with responses, was included in the Appendix of the 18 February 2014 Cabinet report.

The Chief Executive and Head of Finance gave a joint presentation and commented upon the following areas:-

·        National Context and Local Impact

·        Budget Strategy

·        Organisational Redesign & Change

·        Financial Strategy

·        Closing the budget gap – progress, final stages and overview

·        Efficiencies in the Budget

·        Investment Strategy

·        Reserves and Balances

·        Risk Assessment & Assurance

·        2015/16 and the Medium Term

·        Consultation in 2014 for 2015+

Councillor Aaron Shotton, Leader of the Council and Cabinet Member for Finance expressed his thanks on behalf of the Cabinet Members for the work undertaken on the budget.  He referred to the significant and unprecedented challenge faced by the Council due to reductions in funding and increased demand for services and the clear signal of intent set out by the Authority to protect front line services.  He spoke of the proposed reductions in senior management and workforce and he praised the workforce for their assistance and ideas of how to achieve savings within the Council as the pressure facing the Authority could have been significantly higher without their help.  He welcomed the proposal to retain Council Tax at an increase of 3% and he urged Members to support the budget and the proposals contained within it. 

Councillor Mike Peers thanked officers for the report and their work on the budget.  He suggested that the numbering of the appendices be replicated throughout the budget process to allow for easy comparison between the documents.  He also suggested that the budget consultation meetings with Overview & Scrutiny Committees be reviewed to ensure that sufficient time was allocated to consider the issues.  He spoke of the need to recognise the drastic measures that were required to protect frontline services due to the cuts in funding from Welsh Government (WG) of 6% in real terms but also indicated that it was important for WG to prioritise its funding and distribute it fairly across all Welsh local authorities.  The budget proposals in the report were based on an increase of 3% in Council Tax and Councillor Peers welcomed this as raising the rate was one of the possible measures to assist in closing the budget gap.  He requested further information on the efficiencies that had been found following the completion of the Overview & Scrutiny budget consultation meetings and proposed that a headcount freeze be put in place once the re-organisation of the Council had taken place. 

Councillor Matt Wright recognised the difficult decisions faced by the Council and he approved of the intention to protect frontline services, however, he raised a number of concerns about the changes to the organisation and the structure and queried the cost of the exercise.  He felt that the document which set out the changes was opaque and was difficult to follow.  Even though a balanced budget had been presented, Councillor Wright did not have sufficient confidence in the structure and the ability of the Council to deliver the intended efficiencies and said that he would abstain from voting on the budget. 

In thanking officers and Members for their work on the budget, Councillor Richard Jones spoke of the need to find efficiencies but he felt that the process should be scrutinised.  He referred to the Value for Money exercise and said that in his opinion, some of the services had been shoe-horned in to fit the budget.  He asked for additional information on the risk and benefits and the details behind the decisions and referred to a risk to vulnerable people who he believed were to be charged to receive financial advice which was currently being provided for free.  Councillor Jones also raised concern about the consultation document that had been prepared on the Fleet Efficiency and said that he felt that the opportunity to consider how to change and improve the service had been missed.  He spoke of the amount of work outsourced to other companies in the previous 18 months which he felt could have been undertaken internally and asked whether performance levels in future years were expected to be similar or higher than previously reported.  He added that he found it difficult to agree with the budget.  Councillor Jones also referred to the figure for workforce costs of employment of £0.160m in slide 9 and asked for further information on this.    

Councillor Tony Sharps expressed concern that some Members were not able to support the budget proposals and said that most of the criticism seemed to be based on the speed of the reductions in management and workforce, not the financial element.  He spoke of the proposals to protect front line services and the difficult choices that had to be made but he thanked the Leader and Deputy Leader for their work on the budget and the Chief Executive and officers for the advice that they had provided.  He concluded by saying that he felt that even though this year had been difficult, next year would be even more challenging. 

Councillor Gareth Roberts accepted the general theme of the budget and indicated that he would support the proposals but said that losing experienced staff could create problems in the future and could result in the need to employ consultants to fill the gaps.  He commented on the need to spend up to the Standard Spending Assessment (SSA) to ensure that Flintshire was not penalised by Welsh Government in future years and suggested that an increase in Council Tax by 4% or 5% would provide much needed funding to retain some of the workforce and reduce the need to make efficiencies.  He felt that an increase would not be unpopular with residents to ensure continuation of services. 

Councillor Chris Dolphin praised the Leader and Deputy Leader for the difficult decisions that they had made.  He referred to community responsibility and ownership referred to in slide 18 of the presentation and spoke of community facilities that had been neglected and allowed to fall into a state of disrepair.  He queried whether funding would be available for communities to refurbish the buildings for use by future generations. 

Councillor Alex Aldridge said that this year was unprecedented in local government but that it was the intention of the Council to protect local services which were vital to its residents such as libraries.  He said that if SSA had been set in previous years, there would be additional monies available for these services but Members had no alternative but to agree the proposals before them today which included maintaining the level of Council Tax increase at 3%.  Councillor Aldridge referred to the challenges of future re-organisation.  He asked Members to support the proposals and thanked the Leader, Chief Executive and officers for their work on the budget. 

The Leader of the Council, Councillor Shotton, welcomed the fact that no alternative proposals had been put forward.  He thanked Members for their comments but raised concern about the proposal to freeze the headcount as he felt that it was not practical, even though it was not expected that additional staff would be employed.  He expressed his disappointment at the comment of Councillor Wright and indicated that if the organisational change could have been undertaken over a longer period, then it would have been but this was not possible due to the significant reductions in funding.  He asked the Head of Finance to calculate what the budget gap would have been if the organisational change proposals were not carried out.  Councillor Shotton also clarified that it was not the intention of the Council to start to charge for providing financial advice to vulnerable people.  In referring to the comments of Councillor Dolphin, he spoke of the Community Asset Transfer which he said was a key strand and said that some community assets were in the process of being transferred.        

In response to the comments made, the Chief Executive said that the 2015/16 budget process would commence earlier and he added that raising Council Taxover and above Council policy was an option but would only be recommended as a last resort.  The £0.160m costs for the workforce were due to terms and conditions outside part 3 and this had been brought forward early due to works undertaken with the Trade Unions.  He did not agree with a vacancy freeze as some services might increase and some might reduce but he added that each vacancy request would be challenged.  The Chief Executive said that he would welcome a discussion with Councillor Wright about the proposed organisational changes but said that it was a consultation exercise and it was anticipated that if the plans were adopted, they would be positively supported.  He referred to the positive comments that had been received following the work on the Fleet efficiencies.  The Chief Executive added that it was not anticipated that there would be large amount of funds available prior to transfer of buildings to communities.  It would be difficult to replicate the level of cuts proposed this year in future years and he concurred that the decisions required in the future would be more difficult.  

On the issue of funding, the Head of Finance explained that of the £300m funding received, £230m of this came from Welsh Government in the form of Revenue Support Grants or specific grants.  There would be reductions year on year and the 4% for this year did not take account of any anticipated pay award or inflation in some costs.  There were also challenges for demands for services that the Council could not control so the overall reduction was between 6 and 8%.  It was not known what the level of funding would be in the future so there was a level of uncertainty.  If the organisational change proposals were not implemented, the efficiency amount referred to in slide 11 of £3.1m for 2014/15 would be the budget gap faced by the Council at this time.         

RESOLVED:

That the County Council approve the recommendation of the Cabinet from its meeting held on 18 February 2014 as set out in section 9 of the Cabinet report attached to the Council report.