PAPER G
Purpose : For
Decision
Committee : EXECUTIVE
Date : 21
MAY 2002
Title : PUBLIC
SERVICE AGREEMENT
DEPUTY
LEADER
1.
SUMMARY/PURPOSE
This paper sets
out the draft Public Service Agreement for the Council in Schedule 1.
It seeks the Executive’s approval before opening negotiations with the
DTLR on the 1 July 2002.
2.
BACKGROUND
2.1.1
The Government has invited 154 First Tier Local Authorities to enter
into a Public Service Agreement to ‘stretch’ existing performance targets over
a three year period.
2.2 The Isle of Wight has been asked to
submit a draft agreement to the Department of Transport, Local Government & Regions (DTLR) by the 1
July 2002. The Council is expecting to
have a series of detailed negotiations with the DTLR and other government
departments before agreeing a final draft with ministers in September 2002.
2.3 Guidance issued to all Local Authorities
sets out the details required. Each
agreement should have a set of targets which stretch the Council’s performance
in a number of different service areas.
Each agreement must include at least one Education target, one Social
Service target, one extra either Education or Social Service target and one
Transport target.
2.4 The guidance sets out 12 national
targets for which the Government is looking to improve Local Authority
performance. Each agreement will also
include, in the final targets, a majority of national targets and the remainder
will be local targets.
2.5 In return for reaching an agreement and
to help Councils achieve their targets the Government will let Local
Authorities bid for pump priming
money. This could be up to will be
£875.000 for the Isle of Wight. The
Government will also let Councils borrow extra money, but unlike normal credit approvals, the
cost of repayments will not be
met through the Revenue Support Grant system and will therefore represent a
charge to future year’s budgets. The
bid for unsupported credit approval amounts to £1m for the Isle of Wight,
representing an additional revenue charge of just under £100,000 per annum in
the early stages of repayment.
2.6 Successful performance will result in a
further one-off allocation of ‘reward
grant’. Each Council is eligible for
this fund once 60% of the agreed improvements have been achieved up to a total
of £3,325,000 for 100% performance. Achievement of less than 60% of the agreed
target would mean that no reward grant was payable.
2.7 The targets have been selected from areas
of where performance can be improved and/or where residents have identified
them as local priorities.
3.
ISSUES
3.1 The Council has been putting together a
draft PSA since December 2001. Schedule
1 of the attachments sets out 15 draft targets. Each target shows what would have been achieved without a PSA;
what is projected to be done with a PSA and what the added value of a PSA is
expected to be. The local targets have
been selected to help the Council tackle issues of poor performance and/or
areas of concern raised by local residents during consultation exercises.
3.2
The DTLR has invited Council’s to bid for extra freedoms and
flexibilities to help with the achievement of these targets. Details of these requested by the Isle of
Wight Council are set out in Schedule 2.
3.3
Schedule 3 sets out the proposed
bids for pump priming money, showing the amount attributable for each target
area. It also sets out the bids for unsupported credit approval on a similar
basis.
3.4
Schedule 4 sets out the basis for calculating any entitlement to
Performance Reward Grant.
3.5
It is anticipated that the final agreement will consist of
approximately 13 targets; 7 of which will be national targets. To give officers flexibility in the
negotiations with Government departments, we are recommending a total of 15
initial targets, in anticipation that we will want to withdraw two, if we feel
we are being pushed to achieve unrealistic targets.
3.6
Some targets rely upon the support of partner agencies to achieve
them. In these cases, the relevant
Council officer has negotiated the support of the partner agency.
3.7
The draft agreement will go to the Council on the 12 June 2002 and to
the Local Strategic Partnership Board on the 25 June 2002, before being finally
submitted to the DTLR on the 1 July 2002.
4 FINANCIAL
IMPLICATIONS
4.1
Councils are expected to improve their performance continuously as part
of Best Value. The PSA provides some
opportunities for getting additional financial help to achieve this. Extra
revenue costs not subject to bids for pump-priming funds are all to be met from
existing budgets or from savings generated by the various initiatives.
4.2
Potential extra costs arise from the repayments of the Unsupported
Credit Approval borrowings (£100,000 per annum) and from the excess of pump
priming bids over and above the maximum sum available (£503,000 over the life
of the agreement). It would be reasonable to expect offsetting savings from
e-government developments to meet the loan charges, as the borrowing is for
that purpose. The excess of pump priming bids would need to be met either by
increasing the matched funding component made from within existing service
budgets, or by accepting an addition to future years’ budgets.
5 LEGAL
IMPLICATIONS
5.1
The PSA will not be a legal agreement between the Isle of Wight Council
and the Government. The Performance
Reward Grant will only be paid if it can be shown that the Council has met 60%
or more of its performance targets.
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6 RECOMMENDATIONS
The Isle of
Wight Council’s Executive is asked to agree:
·
The draft agreement as set out in Schedule 1
·
The extra freedoms and flexibilities set out in Schedule 2, it is
intended to negotiate with the DTLR to achieve the targets
·
The proposals for allocating pump priming money bids and unsupported
credit approval bids as set out in Schedules 2 and 3
·
How to deal with the extra
costs of unsupported borrowing, and the excess pump priming bids over the sum
available (see para 4.2)
·
The proposal to seek to approval of Council on the 12 June 2002 and
the Local Strategic Partnership Board on the 25 June 2002
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BACKGROUND PAPERS
Report to Executive in
December 2001
Report to Directors’ Group
dated the 8 April 2002 and 1 May 2002
Contact Point : Charles Waddicor , F 520600 ext 2225
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C WADDICOR
Strategic Director of
Social Services and Housing
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P HARRIS
Deputy Leader
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