Agenda item
General Fund Revenue Budget and Medium Term Financial Plan 2011/2012- 2013/2014 (CAB 086/101)
The report and appendices comprising the General Fund Revenue Budget and Medium Term Financial Plan 2011/2012- 2013/2014 are being circulated as a supplementary agenda pack in conjunction with this agenda.
Decision:
Resolved:
1. That the comments and advice of the Overview and Scrutiny Committee meeting arising from its meeting held on 8 February 2011 be noted.
2. That the outcome of the various consultations carried out in relation to this budget as set out in Appendix H of the report and circulated separately as report CAB 097/101, be noted.
3. That the grant funding available for 2011/12 and the indications and forecasts for future years be noted as detailed in Section 8 of the report (CAB 086/101).
4. That the base budgets for 2011/12 be approved for each Directorate as set out at Appendix A of the report (CAB 086/101).
5. That the growth contingency and savings for 2011/12 be agreed as set out in Sections 10, 11 and 13, subject to the amendments set out in resolutions 12-26 below, and Appendices B and D of the report (CAB 086/101) and the implications for later financial years be noted.
6. That the Medium Term Financial Plan set out at Appendix C of the report (CAB 086/101) be noted, together with the savings target arising in relation to future years and the actions being taken to address it.
7. That the advice on strategic budget risks be noted as set out in section 15 and Appendix E of the report (CAB 086/101), in particular the significant increase in risk that the Council is exposed to as a result of the financial settlement, and the proposed response of the Council to managing this risk.
8. That the advice of the Corporate Director Resources be noted in relation to the robustness of the budget process as set out in section 17 of the report (CAB 086/101).
9. That the review of reserves be noted as set out in section 16 and further detailed in Appendices F and G of the report (CAB 086/101).
10. That officers’ advice be noted on the strategy for general reserves and it be noted that this will be further considered by the Cabinet in February.
11. That a General Fund Revenue Budget of £310.960m and a Council Tax (Band D) of £885.52 for 2011/12 be agreed and the proposal be referred to Budget Council for consideration.
12. That the above resolutions be subject to any amendments required following the adoption of the motion proposed by the Cabinet Member for Resources in the terms set out below:
Homecare
13. That the transition from Homecare to Reablement be managed over a longer period so that capacity is reduced due to a natural turnover rather than redundancy.
14. That the aim be to draw down the service fully by March 2016. This will cost approximately £1m and will be funded by:
· A saving of £550,000 from reduced redundancy costs as a result of delivering savings through natural wastage (£8m contingency set aside for redundancy payments)
· £364,000 from an additional transitional grant from the government
· £86,000 from contingencies released by a lower than expected overspend in 2010/11
15. That the transition be reviewed regularly to ensure the standard of provision remains high and that staff are supported throughout the change.
Housing Link
16. That £60,000 be allocated to fund up to three posts for one year to the Housing Link service to ensure a smooth transition for users. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
Adventure Play Provision
17. That the future be protected and sustainability be ensured of the adventure playgrounds in Bartlett Park and at Whitehorse Lane.
18. That the local community be engaged in the management of the facilities to better reflect the needs of those young people that continue to use them.
19. That the future of these adventure playgrounds be protected from the savages of the Coalition Government’s cutbacks.
20. That an additional £50,000 be allocated to ensure that supervised play continues until a 3rd Sector organisation can be engaged to manage the facilities. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
Junior Youth Service
21. That £15,000 be allocated (a total of £120,000) to each school signed up to the scheme as seed funding to establish the new service. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
Democratic Services
22. That savings from the member support team (as set out in pro-forma CE/2) be deferred until June 30 2100.
23. That the budgets for the proposed Mayor’s office and budgets to member’s support be combined into a single pot.
24. That funding of £80,000 be allocated to this pot to allow implementation of the full saving to be deferred to the end of the first quarter of 2011. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
25. That the money currently allocated to member support and the Mayor’s office be combined in one pot.
26. That a cross-party working group be assembled to draw up proposals that ensure that both the Mayor and Members are adequately supported in their roles but the savings identified in CE/2 are achieved from this bigger pot.
Action by:
CORPORATE DIRECTOR RESOURCES (C. NAYLOR)
Service Head, Corporate Finance (A. Finch)
ASSISTANT CHIEF EXECUTIVE (I. FREEMAN)
Service Head, Democratic Services (J. Williams)
Minutes:
Please note that the order of business was varied by resolution of the Mayor and Cabinet earlier in the proceedings to enable this item to be considered along with Agenda items 10.2 “2011/12 – 2013/14 Capital Programme” and 10.3 “Treasury Management Strategy Statement, Minimum Revenue Provision Policy Statement and Annual Investment Strategy 2011/12” following Agenda item 5.1 “Chair’s Key advice of Key Issues or Questions in relation to Unrestricted Business to be considered”. However, for ease of reference the deliberations of the Mayor and Cabinet, and the subsequent decisions taken, are set out below in the order detailed in the agenda.
Mr Chris Naylor, Corporate Director Resources, at the request of the Mayor, in introducing the report, summarised the key points contained therein, indicating in particular that:
- The projected outturn for the Council’s General Fund for 2010/11, a previously-calculated overspend of £1.084m, had now been reduced to £691,000.
- The Transition Grant that the Council would receive in 2011/12 had been confirmed as £4.143m, which was £376,000 more than originally announced.
Councillor Alibor Choudhury, Cabinet Member for Resources, at the request of the Mayor, queried what members may be doing to communicate the impact of budget cuts on services and indicating that some staff were fearful of contacting Members to voice their own concerns. He stressed that the cuts had been imposed on the Council and were a huge blow to the Borough, with £30m savings required in the current year. Opinions of local people and the advice of Officers had been taken into account in order to produce a balanced proposal, with £55m in efficiencies having been identified, although more cuts might be imposed. The rationale was to maintain front end staff and achieve effective management delayering and deal with any waste as it was discovered. None of the budget proposals was designed to weaken support for vulnerable or needy residents, nor to disempower elected Members, who provided a great service in the main.
In Tabling amendments to the recommendations contained in the report, Councillor Choudhury asked the Council to note:
Homecare
- That as a result of massive Government cuts a wide range of Council services must make savings, including those that provide vital services such as Homecare.
- That Tower Hamlets was the only borough in the country with free Homecare and that the Mayor was committed to maintaining a service that was free to end-users for as long as possible.
- The concerns expressed to the Mayor and Lead Members by users and providers of the Homecare service about proposals to draw down in-house provision by 2013.
- That Reablement was an important, effective and popular service but there were many complex factors in the transition to a future system where the in-house Homecare service provided a smaller, specialist reablement service.
Councillor Choudhury then proposed amendments which are shown as resolutions 13-15 below.
Housing Link
- An allocation of £60,000 to fund up to three posts for up to one year.
Councillor Choudhury then proposed an amendment which is shown as resolution 16 below.
Adventure Play Provision
- That during a period of severe financial constraint it was vitally important that the Council continued to provide our young people with access to high quality play facilities.
- The adventure play facilities at Bartlett Park and Whitehorse Lane offered a range of important play facilities that should be preserved at all costs by this Council.
- That with limited open space available to it the provision of structured adventure play provision became even more important.
- That engaging local communities in the provision of adventure play facilities was not only desirable but essential in ensuring that the services that were offered represented those services that were desired and required by the local community.
Councillor Choudhury then proposed amendments which are shown as resolutions 17-20 below.
Junior Youth Service
- That due to changes in Government policy, funding for after school provision now went directly to schools.
- That the Council had worked hard to ensure that eight of the ten schools who previously provided the service in partnership with the Council continued to do so.
- That schools needed support to ensure that the transition from Council-led to School-led provision had minimal impact on parents and children.
Councillor Choudhury then proposed an amendment which is shown as resolution 21 below.
Democratic Services
· That the people of Tower Hamlets had voted overwhelmingly for a Mayoral system.
· That in every other borough with such a system that Mayor had a strong office to drive change, in many cases more expensive than those proposed for Tower Hamlets.
· That the start of the Mayoralty had coincided with unprecedented Government cuts.
· That members had raised concerns about the level of support they were due to receive under current savings proposals (as set out in pro forma CE/2) of £323,000.
· That the Mayoralty and Councillors had a duty to work together for the community.
Councillor Choudhury then proposed amendments which are shown as resolutions 22-26 below.
Councillor Ohid Ahmed, Deputy Mayor, expressed the view that it was correct for the Mayor to mention that his Administration had only had four months out of a 12-month period to prepare a budget. His team had worked very hard and there had been no playing politics with people’s lifestyles. The Mayor had also been correct in re-examining all savings proposals and he thanked the Cabinet Member for Resources for his hard work. The Cabinet team had listened to all stakeholders and the Trades Unions, which demonstrated how seriously they had taken the process.
Councillor Rania Khan, Cabinet Member for Regeneration, commented that, despite the necessary cuts, all opportunities were being sought to save service provision. The Mayor, Officers and Cabinet members had been working night and day for residents and she thanked them accordingly.
Councillor Oliur Rahman, Cabinet Member for Children’s Services, indicated that Members had taken people’s concerns seriously and there was no evidence to support the myth that staff felt threatened by or afraid of Members. There had been much misleading information from some Councillors who had said the Junior Youth Service would be scrapped – this was not so and people had the opportunity to speak to Cabinet members on the issue.
Councillor Rabina Khan, Cabinet Member for Housing, thanked Councillor Choudhury and Officers for budget preparation work and stressed that a consensual budget was important. The Cabinet had listened to people to make sure that the needs and aspirations of local residents were understood.
A Labour Group Member, speaking with the consent of the Mayor and Cabinet, sought and was given clarification/assurance in relation to the following points:
o The budget had been forced upon the Council but regard must be had to proper constructive dialogue.
o The statements supporting the amendments proposed by the Cabinet Member for Resources should have been provided to the Overview and Scrutiny Committee on 8th February 2011 and would have been better tabled at the start of the Cabinet meeting.
o Proposals regarding the Housing Link and Junior Youth Services would be given further consideration.
o With regard to the Members’ Support Service and Mayor’s Office, it was important that Councillors could represent people properly but this must be fully considered in the face of the extant of cuts needed.
o The matter of a £3m reserve fund would also be considered and a response prepared.
At the request of the Mayor, Mr Naylor, Corporate Director Resources, indicated that he had written to each Political Group Leader giving advice about the purpose of reserve funds and he commented further on the extent and use of reserves available to the Council.
The Mayor Moved the recommendations as set out in the reports 10.1, 10.2 and 10.3 on the agenda (taking account of the amendments proposed by Councillor Alibor Choudhury) and it was:-
Resolved:
1. That the comments and advice of the Overview and Scrutiny Committee meeting arising from its meeting held on 8 February 2011 be noted.
2. That the outcome of the various consultations carried out in relation to this budget as set out in Appendix H of the report and circulated separately as report CAB 097/101, be noted.
3. That the grant funding available for 2011/12 and the indications and forecasts for future years be noted as detailed in Section 8 of the report (CAB 086/101).
4. That the base budgets for 2011/12 be approved for each Directorate as set out at Appendix A of the report (CAB 086/101).
5. That the growth contingency and savings for 2011/12 be agreed as set out in Sections 10, 11 and 13, subject to the amendments set out in resolutions 12-26 below, and Appendices B and D of the report (CAB 086/101) and the implications for later financial years be noted.
6. That the Medium Term Financial Plan set out at Appendix C of the report (CAB 086/101) be noted, together with the savings target arising in relation to future years and the actions being taken to address it.
7. That the advice on strategic budget risks be noted as set out in section 15 and Appendix E of the report (CAB 086/101), in particular the significant increase in risk that the Council is exposed to as a result of the financial settlement, and the proposed response of the Council to managing this risk.
8. That the advice of the Corporate Director Resources be noted in relation to the robustness of the budget process as set out in section 17 of the report (CAB 086/101).
9. That the review of reserves be noted as set out in section 16 and further detailed in Appendices F and G of the report (CAB 086/101).
10. That officers’ advice be noted on the strategy for general reserves and it be noted that this will be further considered by the Cabinet in February.
11. That a General Fund Revenue Budget of £310.960m and a Council Tax (Band D) of £885.52 for 2011/12 be agreed and the proposal be referred to Budget Council for consideration.
12. That the above resolutions be subject to any amendments required following the adoption of the motion proposed by the Cabinet Member for Resources in the terms set out below:
Homecare
13. That the transition from Homecare to Reablement be managed over a longer period so that capacity is reduced due to a natural turnover rather than redundancy.
14. That the aim be to draw down the service fully by March 2016. This will cost approximately £1m and will be funded by:
· A saving of £550,000 from reduced redundancy costs as a result of delivering savings through natural wastage (£8m contingency set aside for redundancy payments)
· £364,000 from an additional transitional grant from the government
· £86,000 from contingencies released by a lower than expected overspend in 2010/11
15. That the transition be reviewed regularly to ensure the standard of provision remains high and that staff are supported throughout the change.
Housing Link
16. That £60,000 be allocated to fund up to three posts for one year to the Housing Link service to ensure a smooth transition for users. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
Adventure Play Provision
17. That the future be protected and sustainability be ensured of the adventure playgrounds in Bartlett Park and at Whitehorse Lane.
18. That the local community be engaged in the management of the facilities to better reflect the needs of those young people that continue to use them.
19. That the future of these adventure playgrounds be protected from the savages of the Coalition Government’s cutbacks.
20. That an additional £50,000 be allocated to ensure that supervised play continues until a 3rd Sector organisation can be engaged to manage the facilities. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
Junior Youth Service
21. That £15,000 be allocated (a total of £120,000) to each school signed up to the scheme as seed funding to establish the new service. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
Democratic Services
22. That savings from the member support team (as set out in pro-forma CE/2) be deferred until June 30 2100.
23. That the budgets for the proposed Mayor’s office and budgets to member’s support be combined into a single pot.
24. That funding of £80,000 be allocated to this pot to allow implementation of the full saving to be deferred to the end of the first quarter of 2011. This will be funded from contingencies released by a lower than expected overspend in 2010/11.
25. That the money currently allocated to member support and the Mayor’s office be combined in one pot.
26. That a cross-party working group be assembled to draw up proposals that ensure that both the Mayor and Members are adequately supported in their roles but the savings identified in CE/2 are achieved from this bigger pot.
Reasons for Decisions
These are detailed in paragraphs 3.1-3.2 of the report (CAB 086/101).
Alternative Options Considered
These are detailed in paragraph 4.1 of the report (CAB 086/101).
Supporting documents:
- General Fund Revenue Budget 9 2 2011 (3) SS AF Final SS2601111638pm, item 10.1 PDF 220 KB
- Appendix A - Provisional Base.pdf SS2601111638pm, item 10.1 PDF 19 KB
- Copy of Appendix B - Growth Bids (Final) (2) SS2601111638pm, item 10.1 PDF 38 KB
- App C- Medium Term Financial Plan SS2601111638pm, item 10.1 PDF 17 KB
- Copy of Appendix D1 - Savings Summary (Final)v4 SS2601111638pm, item 10.1 PDF 23 KB
- D2 Appendix All Proformas FINAL SS2601111638pm, item 10.1 PDF 6 MB
- Appendix E - Strategic and Corporate Risks AF (2) SS2601111638pm, item 10.1 PDF 105 KB
- Appendix F - Reserves Balances SS2601111638pm, item 10.1 PDF 84 KB
- Appendix G - GF Balances SS2601111638pm, item 10.1 PDF 46 KB
- General Fund Revenue Budget 9 2 2011 Addendum AF0402111621pm plus DG, item 10.1 PDF 120 KB