2003/4,
after the effect of the temporary protection.
The increase in proposed spending in the national settlement is however
far greater, for instance the grant increase is not enough to provide for what
schools would need simply to stand still in real terms. The gearing effect on Council Tax (which
finances only part of spending) therefore produces a far greater percentage
increase in Council Tax.
7. Overall
the change in the grant system in excess of inflation is equivalent to an 11% increase
in next year’s IWC Council Tax with a further potential 2% due to the way the
system underfunds the proposed passporting of resources to Island schools.
8. Full
details of the changes at national level are set out in Appendices 1 and 2.
9. Responses
to the draft Settlement proposals are invited by 14 January 2003.
Floors and Ceilings
10. The Secretary of State has announced an 8%
ceiling and a 3.5% floor on grant increases. This Council has part of its grant
losses from the system change offset, in the short run only, by the operation
of the floor.
Isle of Wight Council Situation
11. Appendix 3 sets out the proposed Settlement for the Isle of
Wight Council.
Education
12. The Secretary of State for Education and Skills
is proposing that resources be passported through to schools so as to give
schools not less than a 3.2% cash increase in per pupil funding. Unfortunately, those resources have not been
made available to the Council via the grant system. The shortfall in resources amounts to £807k.
13. This means that passporting in full could
only be at the expense of reductions elsewhere or an increase of a further 2%
in next year’s Council Tax.
14. If the council does not passport the
full amount to schools the schools will receive up to 1.4% less than would otherwise be the case. Even with full passporting there is likely
to be a real terms reduction in schools’ resources. The Council would have to
rely, for instance, on spending at FSS on education as one of the possible
valid reasons for not passporting. If this is not accepted by the Secretary of
State he could institute a process which could delay the council tax setting
beyond the planned date of 19 February.
15. However
this may only delay the problem of the underfunding of schools passporting
until the future, albeit with more time for schools to adapt.
16. Members will also be aware that the Council has recently
received a ‘2 star’ rating for this service in the CPA process and retaining
that rating will in part be dependent on funding levels.
17. The proposed Schools Budget must be notified to the Secretary
of State by 31 January and will be proposed to the Executive on 29 January.
Social Services
18. There are many heavy service pressures on Social Services
particularly in the areas of elderly residential care and community support,
with the additional emphasis on facilitating prompt hospital discharge,
enhanced support for foster carers and the recruitment of social work staff are
pressing issues for children’s services.
19. To achieve the same position relative
to FSS in 2003/4 as the 2002/3 budget for Social Services is to SSA (on a like
for like basis) the Social Services budget would effectively allow only for 3%
inflation for Social Services and no growth or inflationary increase beyond
that point.
20. This would, however, fail to address the service pressures in
Social Services or the economic forces affecting the private sector
providers. Furthermore, the chances of
the Council retaining its ‘star’ rating for parts of the service and the
consequential impact on CPA will be potentially affected by funding levels.
Collection Fund
21. An estimated collection fund surplus of
£100,000 due to the efficiency of Council Tax collection in this authority is
taken into account in the forecast.
Directors’ Proposals
22. After consideration in the light of the
proposed grant settlement and the public consultation exercise and as a basis for
discussion the Directors have put forward proposals for a draft budget which
would have the effect of limiting the Council Tax increase to 16.0% with a
possible extra 1.8% if there is full passporting of funds to schools. This is set out in summary in Appendix 4.
23. The draft proposals would:-
·
provide for £2.3 million (7%) of Social Services extra
spending over and above the 3% inflation provision.
·
identify savings of over £1.2m.
·
require for the Public Service Agreement (PSA) commitments
to be met from within the draft totals.
·
require estimated savings of £2.3 million in Education eg
from former Standards Fund monies, postponing some new nursery places, Special
Needs, School Transport etc (or £1.5 million if full passporting takes place).
24. There could of course be alternative
strategies and if, for instance, members wish for a lower tax increase then the
following further net reductions need to be made
|
Tax increase
|
With
passporting for schools
from 17.8%
|
Without
passporting for schools
from 16.0%
|
|
17%
16%
15%
14%
13%
12%
|
£000
360
811
1,262
1,714
2,165
2,616
|
£000
451
902
1,353
1,804
|
25. Each 1% change in Council Tax for this
Council’s services necessitates a £451k change in expenditure and produces an £8.95
per annum change in Band D Council Tax or £7.96 for the typical Band C Island
Council Tax Payer.
Uncertainties
26. At this stage the actual level of some
pay awards for 2003/04 is unknown.
27. There are as always a number of budget pressures
which will need to be considered as part of the process. If the Secretary of State for Education and Skills rejects the
Council’s proposed Schools Budget he may institute a process which lasts four
weeks and would therefore delay the scheduled Council Tax setting date of 19
February.
Balances
28. Due largely to the now estimated £380,000
loss on the music festival in June 2002, it is expected that the General Fund
balance at 31 March 2003 will be reduced to just over the £2 million level
(less than 2% of net expenditure). The
District Auditor has commented that this is a very low level of balances
leaving little flexibility for meeting unexpected liabilities or reductions in
income.
Capping
29. There is no pre-announced capping limit
for 2003/04 although reserve powers will still be available to the Government
to curb what it might decide are excessive increases in spending or Council
Tax.
Capital Allocations
30. The Council has received its main capital
borrowing approvals for 2003/4. These
are set out in Appendix 5 and show a very large increase in the Education
sector, a 19% reduction in Highways and an overall 10% increase. There will also be some specific
Supplementary Credit Approvals (SCAs) to come.
A full report on the capital programme will be made in February.
Future Years
Appendix
4 continued
2003 2004
2005
Efficiency savings 2004 2005
2006
£ £ £
Select
Committee Support
216 Select Committee Various
economies -9 -9 -9
Support
Total
for Select Committee Support -9 -9 -9
Cross cutting items
256 Local Public Service Restrict pump priming to
Government limit, or meet from service -392 0 0
Agreement economies
Total
for Cross cutting items -392 0 0
Community Development
228 Arts Appointment
of Theatres Manager 45 -45 -45
Total
for Community Development 45 -45 -45
Education
251 Various Miscellaneous
savings -19 -19 -19
Total
for Education -19 -19 -19
Consumer Protection
258 Bereavement Services Externalisation 0 0 0
Options
to be investigated
Total
for Consumer Protection 0 0 0
Planning
210 Planning Trimming a
number of budgets -50 -50 -50
Total
for Planning -50 -50 -50
Total
Efficiency savings -425 -123 -123
03 January 2003 12:07 PM Page
1 of 6
Appendix
4 continued
2003 2004
2005
Income generation 2004 2005
2006
£ £ £
Legal
& Democratic
214 Land Charges Increase by £14
to £117 - saving net of inflation -49 -49 -49
Part
funding for item 22
Total
for Legal & Democratic -49 -49 -49
Consumer Protection
14 Bereavement Services Increase of 3% over inflation for
bereavement services -18 -18 -18
197 Bereavement Services Single occupancy charge for
graves (£130) -40 -40 -40
Total
for Consumer Protection -58 -58 -58
Engineering Services
211 Car parks Traffic management and offset to reduction in Highways FSS -500 -500 -500
Total
for Engineering Services -500 -500 -500
Total
Income generation -607 -607 -607
03 January 2003 12:07 PM Page
2 of 6
Appendix
4 continued
2003 2004
2005
Maintain existing service levels 2004 2005
2006
£ £ £
Corporate
Policy & Communications
209 Crime and Disorder CCTV costs at
Ryde - part funding 12
One
year only, then passed to Ryde Forum
Total
for Corporate Policy & Communications 12
Finance
1 Finance & Business To achieve
Government standards for benefit payments - 5 staff 25 50 75
offset
by sanction income
2 Finance & Business To meet
requirements of the Local Government Bill, especially 25 25
prudential
code
Review
as part of medium term budget
184 Finance & Business New tax &
pension credits - additional 2500 benefit claims p.a. 22 22 22
Total
for Finance 47 97 122
Education
74 School budgets Pupil numbers
(excl 6th form) 212 241 195
78 School support Complex/severe
SEN statements 120 234 342
85 SEN Communications
& Interaction team - funding at risk 70 70 70
86 SEN Nodehill
centre - funding at risk 25 25 25
250 School Transport Increase in
contract costs by Transport Fleet 118 118 118
Total
for Education 545 688 750
Consumer Protection
4 Environmental Health Replacement noise monitoring
systems 8 6 0
5 Environmental Health Increased pest control contract
costs 7 7 7
9 Bereavement Services Implementation of Health &
Safety recommendations re 15 15 15
Further
£15k from risk management funds
Total
for Consumer Protection 30 28 22
Engineering Services
44 Newport Harbour Loss of income
as area is developed 10 10 10
54 Transport Concessionary
fares age equalisation 180 185 190
254 Transport Fund concessionary
fares equalisation from other existing -180 -185 -190
Total
for Engineering Services 10 10 10
Property Services
25 Property Markets security 10 10 10
Total
for Property Services 10 10 10
Fire & Rescue
72 Fire Service Radio licence
fee 10 20 30
73 Fire Service Fire inspector's
recommendations 66 66 66
164 Fire Service Radio
replacement 29 29 29
166 Fire Service Personal
protective equipment - includes admin and replacement 85 85 85
178 Fire Service Working at height/near
water regulations 23 35 35
259 Fire Service Reduce bids by
£53k to £160k -53 -53 -53
Total
for Fire & Rescue 160 182 192
Social Services
Social Services Expenditure
increase in excess of inflation 2277 2434 2434
Total
for Social Services 2277 2434 2434
Total
Maintain existing service levels 3091 3449 3540
Page 3 of 6
Appendix
4 continued
2003 2004
2005
Service improvement 2004 2005
2006
£ £ £
Finance
3 Finance & Business To improve audit
coverage of identified risk areas - one additional 25 25 25
auditor
to bring resources closer to District Auditor
Combined
with restructuring
Total
for Finance 25 25 25
Information & Communication Technology
18 Trading Standards Upgrade of Trading
Standards ICT to corporate standard 4 0 0
19 Trading Standards Replacement of
Trading Standards ICT hardware (FLAIR) 12 0 0
21 ICT ICT/e-government
strategy in excess of £500k in base 0 0 0
31 Engineering Web development 10 5 5
32 Engineering e-government
requirements 5 5 5
46 Car parking ICT 0 8 8
Meet
from income in year 1
147 Social Services - central ICT - Local Implementation Plan bid
(£1.1m over 3 years) 120 120 120
Unsupported
credit approval of £1.3m
167 Fire Service Fire service ICT
developments 250 350 350
185 Finance & Business Education Forum
secure web page 6 12 12
187 Finance & Business Registrar's Web
Site - additional income? 5 0 0
227 Libraries Peoples Network
- additional costs caused by company failure 30 30 30
253 Various Reduction in ICT
bids -242 -242 -242
Total
for Information & Communication Technology 200 288 288
Legal & Democratic
22 Legal & Democratic Additional officer to co-ordinate
new statutory requirement 30 30 30
Funded
by part of item 214
Total
for Legal & Democratic 30 30 30
Education
71 School budgets Education Forum
secure web page 6 12 12
252 SEN Childrens'
SEN project leader 50 50 50
Total
for Education 56 62 62
Engineering Services
260 Car parks Improvements to car
parks, financed from item 211 0 100 100
Total
for Engineering Services 0 100 100
Planning
58 Development control Additional qualified planner for
major applications 27 28 29
Total
for Planning 27 28 29
Fire & Rescue
168 Fire Service Community Fire Safety 18 23 28
172 Fire Service Breathing
apparatus replacement 0 0 150
Total
for Fire & Rescue 18 23 178
Total
Service improvement 356 556 712
03 January 2003 12:07 PM Page
4 of 6
Appendix
4 continued
2003 2004
2005
Service reduction 2004 2005
2006
£ £ £
Corporate
Policy & Communications
203 Communications Ryde Help Centre
one off saving -7 0 0
204 Community Budgets Reduce community forum grants -32 -32 -32
205 Communications Cut one issue of
Wight Insight -5 -5 -5
206 Economic Development -24 -24 -24
207 Communications Citizens panel
questions to be funded 50% from departments, if -9 -9 -9
required
208 Crimw and Disorder Supplies and
services budgets -2 -2 -2
Total
for Corporate Policy & Communications -79 -72 -72
Finance
193 Finance & Business Staff rationalisation -66 -66 -66
Services
Additional
burden on remaining staff
195 Administrative Buildings Reduce budget for improvements and
refurbishments -24 -24 -24
Total
for Finance -90 -90 -90
Legal & Democratic
215 Members Expenses Reduce
conference and travel budgets -7 -7 -7
Total
for Legal & Democratic -7 -7 -7
Cross cutting items
262 Spend to save Delete annual
spend, and replace by repayable loans from -250 -250 -250
Total
for Cross cutting items -250 -250 -250
Community Development
218 Parks and Beaches Discontinue
seaside awards 0 -10 -10
219 Parks and Beaches Discontinue
beach lifeguards -25 -25 -25
220 Parks and Beaches Reduce beach
cleaning standards to EEC minimum -75 -75 -75
221 Parks and Beaches Discontinue
decorative lighting -9 -18 -18
222 Libraries Closure of 5
libraries -60 -106 -106
223 Tourism Closure of a TIC -20 -20 -20
Total
for Community Development -189 -254 -254
Consumer Protection
198 Dog Warden contract Reduce coverage of non-statutory
contract -4 -4 -4
Total
for Consumer Protection -4 -4 -4
Engineering Services
261 Highways Reduce spending
by half of increase in excess of FSS -248 -248 -248
Highways
standstill budget represents increase £488k greater than FSS
Total
for Engineering Services -248 -248 -248
Property Services
212 Property Services Reduce
consultants budget -9 -9 -9
213 Building maintenance Reduction of maintenance budget -40 -40 -40
Total
for Property Services -49 -49 -49
Housing
249 Bed and breakfast Savings from
Housing Action Plan -25 -25 -25
03 January 2003 12:07 PM Page
5 of 6
Appendix
4 continued
2003 2004
2005
Service reduction 2004 2005
2006
£ £ £
Total
for Housing -25 -25 -25
Social Services
244 Adult services Top slice budget -99 -99 -99
245 Adult Services Staff turnover
period increased to 3 months -19 -19 -19
246 Childrens services Multi agency
working (special projects) -20 0 0
247 Childrens Services Residentail
services top slice -30 -30 -30
248 Policy Performance & Top slicing -39 -39 -39
Resources
Total
for Social Services -207 -187 -187
Total
Service reduction -1148 -1186 -1186
Report
total 1429 2251 2498
Page
6 of 6
APPENDIX
5
CAPITAL ALLOCATIONS
2003/4
2003/4 2002/3 %
£000 £000 Change
1 Annual Capital Guideline (ACG) 14,207 12,908 +10.1
Receipts Taken Into Account (RTIA) 0 754 -100.0
Basic Credit Approval (BCA) 14,207 12,154 +16.9
The breakdown of ACG between services
is as follows:-
2003/4 2002/3 %
£000 £000 Change
Education 6,357 3,508 +81.2
Environment 240 284 -15.5
Highways 5,495 6,782 -19.0
Housing 1,532 1,781 -14.0
Social Services 105 120 -8.8
Performance related 478 433 +10.4
14,207 12,908 +10.1
Notes:
1 In 2002/03 an additional total of
£1,819,000 was allocated to Education through Supplementary Credit Approval
(SCA). The total capital allocation for
2003/04 has been made in the form of ACG.
2. The reduced Highways allocation arises from the 2002/03 year
containing additional allocation relating to the Niton Undercliff situation.
3 The performance related total relates
to Government’s overall assessment of our capital investment plans including a
total reward of £100,000 relating to our good assessment for both Capital
Strategy and Asset Management Plan submission.
4 RTIA is the amount of ACG that the
Government assumes will be met from our capital receipts. It is calculated by reference to capital
receipts in the past financial year, but no RTIA is currently apparent in the
2003/04 announcement.
5 BCA represents the Council’s capital
basic borrowing approval for the year
GARETH HUGHES
Corporate Finance Manager
10 December 2002 gwh/capital/2002/capitalallocations2002
APPENDIX 6
|
November consultation - preference for service
cuts if required (% responses)
|
|
|
Service
|
Definitely
Reduce
|
Reduce
if I had to
|
Definitely
not Reduce
|
|
community forums
|
78
|
19
|
3
|
|
leisure events
|
76
|
20
|
5
|
|
museums, theatres and support for the arts
|
64
|
30
|
7
|
|
sporting and leisure facilities
|
60
|
33
|
8
|
|
economic development and support for local
businesses
|
38
|
43
|
20
|
|
promoting tourism
|
40
|
34
|
27
|
|
consumer protection including environmental
health and trading standards
|
29
|
52
|
19
|
|
supporting public transport and concessionary
fares
|
36
|
34
|
30
|
|
housing and homelessness
|
28
|
49
|
24
|
|
youth services
|
27
|
50
|
22
|
|
parks and open spaces
|
23
|
56
|
21
|
|
the library service
|
21
|
50
|
29
|
|
street lighting
|
14
|
53
|
34
|
|
keeping roads, pavements and beaches clean
|
11
|
54
|
35
|
|
waste management and recycling
|
10
|
50
|
40
|
|
schools
|
17
|
31
|
52
|
|
helping children with educational and other
problems
|
11
|
36
|
53
|
|
The Fire Service
|
14
|
28
|
57
|
|
support for people with physical or other
learning difficulties
|
8
|
38
|
55
|
|
public toilets
|
8
|
37
|
55
|
|
repairing roads and pavements
|
7
|
36
|
57
|
|
services for older people
|
8
|
28
|
64
|
|
crime and disorder
|
7
|
13
|
80
|
|
|
|
|
|
|
Increased charges (% responses):
|
|
|
|
|
|
No
Increase
|
Increase
|
No
View
|
|
car parking
|
51
|
45
|
4
|
|
sports facilities
|
16
|
79
|
5
|
|
other leisure facilities
|
11
|
82
|
7
|
|
burial and cremation charges
|
53
|
34
|
13
|
|
charges for social services clients
|
35
|
50
|
15
|
|
|
|
|
|
|
|
Increase
Council Tax
|
Reduce
Services
|
|
|
increase tax or reduce services
|
16
|
84
|
|
APPENDIX 7
Revised planning
and budget timetable
|
|
Select Committees
|
Executive/Other
|
|
Mid January
|
|
Executive considers draft budget
proposals/options in the light of Proposed Grant Settlement, budget consultation,
Best Value Reviews
|
|
End January
|
|
Final Grant Settlement
|
|
Late January
|
Co-ordinating Committee considers
Executive budget proposals/options
|
Consultation with business, unions,
partners
|
|
February
|
|
Executive considers all responses and
recommends budget to Council (12th)
Budget and Tax set. 3 Year Projection approved (19th)
|
