Agenda item
OSC Comments on Initial 2013/14 Budget Proposals
To endorse OSC comments on the Mayor’s Initial 2013/14 Budget proposals, arising from Extraordinary Budget OSC meetings held on 21st and 22nd January 2013, and to consider further comments on the Budget proposals.
Minutes:
The Chair outlined:
· The process to date in formulating the OSC response to consultation on the Mayor’s initial 2013/14 Budget proposals.
· The purpose of this Budget session: to finalise and formally endorse the OSC response to consultation.
· The next steps in the formal Budget making process.
· The potential for/ purpose of a third Extraordinary Budget OSC meeting.
· That the February Cabinet had been postponed, the agenda papers had not yet been published, and therefore the OSC had not had an opportunity to pre-scrutinise Budget proposals contained therein. In this context the Chair commented that it would be important for Councillor Choudhury, Cabinet Member for Resources, to attend any third extraordinary Budget OSC meeting to provide an opportunity for the OSC to receive a response to any questions/ comments it had.
The Chair informed OSC members that:
· Notes, in Question and Answer format, from the two extraordinary Budget OSC meetings held on 21st and 22nd January 2013, together with a related sheet of Chair’s “summary comments” had been Tabled, a copy of which would be interleaved with the minutes.
· Officer responses to outstanding questions raised at the two extraordinary Budget OSC meetings held on 21st and 22nd January 2013 had been Tabled, a copy of which would be interleaved with the minutes.
Councillor Alibor Choudhury (Cabinet Member Resources), Chris Holme (Acting Corporate Director Resources), and Alan Finch (Interim S151 Officer & Service Head Financial Services, Risk & Accountability) were in attendance to answer questions from the OSC.
A discussion followed which focused on the following points, considered beyond the scope of the tabled Q&A notes and Officer responses and requiring further clarification to be sought and given:-
CLC
· Referencing the tabled Officer response on the Council’s new public health roles for infection control and prevention, and the comment therein that “The Council needs to determine if there is a budget issue before it can act”, whether the new roles went beyond that provided for in the budget of £31.2 million transferring from the NHS to the Council to accompany the transfer of PH responsibilities.(Ms Cohen, SH Commissioning & Health - AHWB).
· Referencing the tabled Officer response on levels of rubbish dumping and any correlation of this to the introduction of charging for bulk rubbish collection, it was noted that call volumes reporting all “fly tipping” had increased by 10%, and although no significant increase in “fly tipping” or additional costs had been identified by Officers, consideration that further monitoring was needed to ensure that costs were contained, and this phenomena factored into the letting of bulk waste contracts.
CSF
· Referencing the tabled Officer response on Mayor’s Education Allowance (MEA): whether unused funding allocated for MEA (due to the linkage with student attendance) could be used in another way for the benefit of the young people it was intended to help. Also, referencing the Chair’s tabled summary comments highlighting OSC concern that monies earmarked for MEA were not being used, when this appeared predictable given the spend under Government EMA and related attendance levels, what were the next steps if the funding for MEA was unused: would there be a further allocation of the same level, would it be used for a similar purpose to that which was intended, would it be allocated elsewhere for a different use, what was the explanation for over-budgeting.
· Referencing the Officer response on vacancy management in the Q&A notes (21st January), consideration that this was not the best approach going forward.
AHWB
· Referencing the vacancy management savings highlighted by Officers, comment that the AHWB directorate had already made significant savings in difficult circumstances, and it was a concern that a further 5% saving from the staffing budget was proposed without further details of how/ where this was to be achieved and what the impact on services might be.
· Concern reiterated that change management programmes were off track, and savings were not being delivered as fast as they should be.
· Comment that the Budget process had commenced with no expectation of identifying further savings in AHWB, circumstances now meant there was to be a transfer of Public Health (PH) responsibilities to the Council, but there was uncertainty as to how this would happen and the risks/ costs attached, with uncertainty exacerbated by the vacancy for a Director of PH in Tower Hamlets. Consideration that this post be recruited to as soon as possible and certainly before the transfer of PH responsibilities to the Council on 1st April.
· The nature of the anticipated release of funding from the PH Grant.
· Whether these savings be reflected in an adjustment to the Budget at February Cabinet.
RES/ CEs/ Corporate
· Referencing the tabled Officer response on Earmarked Reserves and the narrative relating to the Corporate Initiatives Reserve of £1.091 million: specifics as to what was the reserve would cover, who had taken the decision to undertake a reorganisation of the Communications Team, and what had this been intended to achieve, which Officer had been responsible for this reorganisation. Also the reference to “future Chief Executive’s department organisations implied a broad reorganisation, who would be responsible for this work. A written answer would be provided (Mr Alan Finch Interim S151 Officer and SH Financial Services, Risk and Accountability).
· Referencing the tabled Officer response on Earmarked Reserves and the narrative relating to the Various Unallocated Reserve of £1.65 million: whether it was the intention to identify a further £400k to increase this to £2 million, in order to increase the current allocation of £900k to fund grants for Faith Based Buildings (FBB). Also where had this funding decision been taken.
· Referencing the tabled Officer response on Earmarked Reserves and the narrative relating to the Employment & Other Corporate Initiatives - Access to Employment/ Future Jobs Fund Reserve of £1.539 million: why was this in reserves and not spent. In response to an OSC request it was agreed that the 5 year business plan and details of the funding thereof be provided to the OSC. (Mr Holme, Acting CD Resources)
· Referencing the tabled Officer response on General Fund Reserves and Corporate Reserves, what action was being taken to mitigate the significant budgetary risk facing the Council due to the large funding gap in 2015/16 and beyond.
· The Budget contained significant resources, in excess of approximately £6 million, available for spending on Mayoral priorities; and some initiatives, such as increasing funding for FBB Grant to £2 million, were not considered critical by residents and did not have budgeted outcomes. Consideration also that the available resources should be set in the context of the imminent funding gap of approximately £20-30 million in 2015/16; and further thought be given to funding services the Council was required to provide, whether all the Mayoral spending was necessary, and whether resources would be more wisely placed in reserves to meet the funding gap.
· Consideration that investment in local infrastructure to facilitate local people delivering services for the community was to be welcomed, but there appeared to be no related criteria to meet when applying for FBB Grant. How would the funding be prioritised. When applying for grant, what information had to be provided on service delivery outcomes should grant be awarded.
· What were the award criteria for FBB Grant in terms of historical and cultural heritage value. When applying for grant how were applicants required to demonstrate that the award of FBB Grant would maintain/ improve historical and cultural heritage in the borough.
· With reference to Chief Executive’s (CEs) directorate, consideration that savings and growth, even if not substantial, should be detailed in the Budget papers, and this had not been the case with the savings and growth for CEs that had now been highlighted in Officer responses. Also disappointment that there had been no provision on the agenda for a Q&A session on CEs Budget, when there were questions to ask eg staff costs for the Mayor’s Office; and consideration that OSC had a legitimate expectation to scrutinise and ask questions on such issues. Although new narrative had been provided on the CEs budget it was insufficient. Also given the current climate of budgetary constraint, savings required/ delivered previously, and savings required of other directorates, was it not reasonable to expect CEs to make further savings.
The Chair summarised that the draft response of the OSC to consultation on the Mayor’s initial Budget proposals, previously circulated to the Mayor and Cabinet Member for Resources, would be supplemented by the addition of further narrative from this Budget session, but would not change substantively. The response would be finalised in the next few days, as this was not urgent given the postponement of February Cabinet and Budget Council. Information requested in this Budget session should be provided as soon as possible to facilitate this. The Chair the Moved and it was:-
Resolved
That the OSC response to consultation on the Mayor’s initial 2013/14 Budget proposals comprises of a composite report to be presented, by the Chair of the OSC, to the Mayor in Cabinet on 13 February2013 including:
(a) The Q&A notes from the two extraordinary Budget OSCs held on 21st and 22nd January 2013, and the Budget session of the ordinary OSC held on 5th February 2013;
(b) The written responses provided by Officers to questions at the meetings detailed in (a) above;
(c) A sheet of summary comments, relating to meetings detailed in (a) above, from the Chair of the OSC.
Action by:
Angus Taylor, Principal Committee Officer