PAPER B
Committee : RESOURCES SELECT COMMITTEE
Date : 23 JANUARY
2003
Title : LOCAL
GOVERNMENT FINANCE SETTLEMENT, BUDGET FOR 2003-04 AND FORWARD PLAN FOR 2004-06
REPORT OF THE STRATEGIC
DIRECTOR FOR FINANCE AND INFORMATION AND COUNTY TREASURER
REASON FOR SELECT COMMITTEE CONSIDERATION
This report sets out the draft budget proposals for
2003-04 as considered by the Executive on 15th January 2003. The
Committee have requested the opportunity to consider the budget proposals, in
particular those which will have an impact on the service areas within the
Committee’s terms of reference.
ACTION REQUIRED BY
THE SELECT COMMITTEE
The Committee’s views are invited, particularly in
relation to the possible increases and decreases in expenditure and income set
out in appendix 4.
BACKGROUND
On 5 December 2002 the Government’s proposals on the
Local Government Settlement for 2003/04 were announced, and brief information
was circulated to all members on 11th December.
The proposals incorporate a major change to Revenue
Support Grant methodology, which is disadvantageous to a number of authorities,
particularly in the south east area. Generally speaking, councils in the north
and midlands benefit from the new arrangements.
Of all the Education and Social Services authorities
in England, the Isle of Wight Council has the second worst grant figure, with a
long term impact equivalent to 22% on the Council Tax or expenditure reductions
of £10 millions. Temporary protection through floors and damping reduces this
in 2003-04 only to 11% on Council Tax or £5 millions of spending reductions.
In addition to this the Council is being asked to
passport more funds to schools than it receives in increased Formula Spending
Share. This would add a further 1.8% to Council Tax, or require further
reductions of £807,000.
On the 15th January 2003 the Executive
received a position statement as a starting point for discussion. The
appendices to the report are attached, and comprise the following:
·
An overview
of the grant settlement for 2003/04 for England (appendix 1)
·
A summary of
the national SSA comparisons for 2003/04 with 2002/03 adjusted (appendix 2)
·
Details of
the proposed settlement for the Isle of Wight showing comparisons with national
trends and a year on year comparison (appendix 3)
·
As a basis
for discussion the Directors have put forward proposals for a draft budget
which would have the effect of limiting any Council Tax increase to 17.8% if
there is full passporting of funds to schools (appendix 4). Items within
this Committee’s terms of reference are highlighted.
·
The Council’s
main capital borrowing approvals are shown in Appendix 5. These presently show
an overall increase of some 10%. However, contained within that figure is a
large increase for Education and a reduction for Highways (appendix 5).
·
Public
consultation results (appendix 6)
·
Revised
planning and budget timetable (appendix 7).
The Executive agreed that the draft budget be
presented to the Co-ordinating Committee for comment and also resolved in
principle to recommend to the Council that full passporting to schools should
take place.
RELEVANT PLANS, POLICIES, STRATEGIES AND PERFORMANCE
INDICATORS
The services included within this report are linked to
a number of the Council’s key strategic objectives and plans, in particular in
raising standards of achievement, encouraging learning and promoting opportunities
for all, developing the knowledge and skills needed for employment
opportunities, supporting and developing Council staff and managing the
Council’s property and other resources efficiently and effectively.
There are no immediate implications for performance
indicators arising from the production of this report. However, there will be
implications for future performance measures and indicators arising from the
information contained within the report, in particular cost based indicators,
but also the outcomes arising from the provision of services to which this
report refers.
The recent CPA result recommended that the Council
take forward current work aimed at better integration of corporate, service and
financial planning, and that the Council should move to ensure the full
implementation of a corporate performance management system which links service
and financial monitoring.
CONSULTATION PROCESS
A summary of the results of the Autumn consultation
process with members of the public on budget priorities is included as appendix
6.
FINANCIAL, LEGAL, CRIME AND DISORDER IMPLICATIONS
Since this is a budget report there are a considerable
number of financial implications for the Council as a whole, and for the
services for which this Committee has responsibility, which are set out in
appendix 4.
There is a statutory requirement for the Council to
set its Council Tax for next year by no later than 11 March 2003.
There are no direct crime and disorder implications
arising from the production of this report.
BACKGROUND PAPERS
Council publication ‘Budget 2002-03’
Executive Committee report of 15th January
2003 - ‘Local Government Finance Settlement And Budget 2003-04’
Contact Point : Andrew Carpenter, F 823641
John Pulsford
Strategic Director for Finance and Information and
County Treasurer
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 Crime 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)
|
