Agenda item

Julie Evans, Strategic Director of Resources, outlined a report and presentation setting out the latest projections of the council’s revenue budget for the period 2011/12 to 2014/15.  The report followed the previous Cabinet report of 13^th December, 2010 and the Policy, Performance and Review Group (PPRG) on 10^th January, 2011. 

The Committee received a presentation detailing the outcome of the Government’s settlement which provided clarity on the levels of national grant the council could expect to receive over the next two years.  It was noted however that some element of the funding notably relating to schools would provide only a one year settlement position.  Some uncertainty remained regarding the elements of grant funding outside of the Comprehensive Spending Review (CSR) and information was currently awaited on the allocation from a number of Government Departments including the Home Office and the Department for Work and Pensions.  The report therefore provided members with progress against the savings targets and estimates of savings requirements in the light of the information known to date. 

Within the presentation the Committee was advised that the Council’s planned response to cut in public expenditure had been £19,487,000 against an actual outcome of CSR confirmed funding of £18,921,000.  The Director advised that financial planning was on track, the population increase had been recognised to some degree, and schools funding had been maintained.  It was pleasing to advise that Sure Start funding had been protected and new people premiums would cushion the impact on schools to largely inflationary pressures.  In respect of council tax it had been assumed that there would be 2 year freeze but it was confirmed that this would actually be only for a period of one year.  The Committee noted the areas of the settlement which were not as good, including that there was a smaller funding pot provided to deliver early intervention activities, and there was a greater allocation of cuts in early years than previously indicated.  The Director advised that approximately £2.7m in grant funding had ended and therefore schools services operated by the Local Authority would no longer be funded (£1.6m Schools Development Grant).  It was also unfortunate that the local authority DSG allocation had been top sliced to fund the national academy programme which equated to a loss of circa £400k.  It was clear that there was therefore £2m of unfunded education/schools services and the council would need to address this.  It was highlighted that over the following four years the Council’s spending ability would be reduced overall by £25.2m and this would impact on local tax payers. 

The Committee was reminded that the balanced budget must be set by Council at its meeting on 21^st February, 2011.  It was noted that additional savings of £6m for year one had been secured to date and the Council would need to find £2.7m in funding for services where the grant funding had ended, otherwise the services would end. 

The Committee noted the progress on reducing the future funding gap and the detail of the first tranche of savings representing an estimated savings value of £6.9m with effect from 1^st April, 2001 (as set out within Appendix A of the report).  The Committee was advised that the focus of the savings was in line with members requirements and was focused away from customer facing frontline services, requiring reductions in corporate areas such as management costs and support services.  The Committee noted proposed additional elements of savings regarding the finance service and property services which if agreed would be subject to the required consultation and impact assessment process.

The Committee noted that the Council was currently undertaking a review of its assets and this would be reported to Cabinet in February 2011.  Trading functions, would also be reviewed to, for example, review fees and charges and this would contribute to the 2012/2013 forecast shortfall. 

Members raised a number of questions/comments in the ensuing debate including the following (responses in italics):

·  A member asked the Director to clarify the statement regarding the top slicing of the Authority’s DSF allocation to fund the National Academy Programme.

The Council had a statutory duty to schools and the Government had assumed that support would be reduced due to authority’s having a number of academies.  Whilst some authorities were unaffected by this position because they had several academies within their area, Slough BC at present only had one academy and therefore the Council was adversely affected by this situation. 

·  A member questioned the position regarding zero based budgets and the possibility that the Committee would be better placed to scrutinise how money was spent in future years over a longer period of time. 

The  Council did have a real opportunity to challenge why it spent money in particular services and it would be important to have a radical look at spending over the next three years or so, giving rise to potentially to big changes.  The Director of Resources advised that for example support services finances had completely been revisited so in effect an element of zero based budget process had applied in this area.

·  A member suggested that if the Council became leaner it could be in growth in three years time.  How could scrutiny contribute in a positive way to achieve the best outcome for the Town?

The Committee was advised that very stringent targets had been met in the current year and reductions would continue in the following year.  It was accepted that being able to design and shape the Council gave members considerable freedom in this area. 

Resolved – That the Committee note the recommendations set out in the report that will  be considered by Cabinet at its meeting on 24^th January, 2011.