Agenda item
Budget Implementation 2013/14 (No 1)
- Meeting of Overview & Scrutiny Committee, Tuesday, 9th April, 2013 7.00 p.m. (Item 5.1)
- View the background to item 5.1
Minutes:
Please note that the order of business was varied by resolution of the OSC earlier in the proceedings in order to allow this item of business to be taken as the second item of substantive business (considered after agenda item 5.2), however for ease of reference OSC deliberations, and subsequent decisions taken, are set out below in the order detailed in the agenda.
Please note that composite “Special Circumstances and Reasons for Urgency” were agreed for this “Call In” at agenda item 5 above.
The Chair welcomed: Councillor Carlo Gibbs, one of seven Councillors who had “Called In” decision of the Mayor outside Cabinet (Decision Log Number 021 “Budget Implementation 2013/14 (No 1)” in accordance with the provisions of Part 4 of the Council’s Constitution. Also Councillor Alibor Choudhury, Cabinet Member for Resources, and Mr Chris Holme Acting Corporate Director Resources, who were in attendance to respond to the “Call-in”.
Councillor Carlo Gibbs presented the “Call-in”: summarising the reasons for “calling in” the Mayoral Decision, outlining the key concerns of the “Call-in” Members, and setting out the action sought from the OSC to address these. He also highlighted the additional point that Councillor Choudhury had indicated in his response to the “Call In” considered at agenda item 5.2 earlier in the proceedings, that Mayor considered the amendment to the Budget at Budget Council to have been politically motivated. To take a decision to change that would have political ramifications, and it must therefore be a ’key’ decision. By determining otherwise the Mayor had placed the Authority at risk of legal challenge
Councillor Alibor Choudhury, Cabinet Member for Resources, responded to the concerns raised by the “Call-in” Members and subsequently responded to questions from the OSC summarised as follows:
· Referring to the above point on political ramifications of the decision, made by Councillor Gibbs, he had not used the word political in its literal sense in the previous discussion.
· Legal advice made clear that the Authority could not lawfully place an artificial cap on statutory adverts, and it was wrong to suggest this.
· The reduction in the Budget for East End Life (EEL) would lead to redundancy of12 full time staff, and it was therefore subject to the Authority’s processes requiring consultation on such matters with staff and trades unions. The amendment to the Budget had no regard for this process. Also a high proportion of these staff were women and BME, a matter the Mayor took seriously.
· Due regard must be paid to the equality impacts of the proposals, and a full EQIA would need undertaken. Thought needed given to the people that accessed EEL, their reasons for doing so and the impact of closure.
· Financial and contractual obligations needed consideration eg the Authority had recently joined a London-wide print contract and the implications of breaking the contract needed assessed.
· The Authority had a duty to promote equality and social cohesion and used EEL to reach service users and the wider community and the Budget amendment did not take this into consideration.
· Placing statutory notices elsewhere would increase costs significantly, as the former Chief Finance Officer had previously advised. This needed consideration.
· The Mayor considered it sensible to continue the provision of EEL whilst a review of the options was undertaken.
· The Authority had a continuing need to communicate with the maximum number of residents and EEL reached 80 or 90,000 households each week. The Mayor didn’t believe this could be achieved without it.
· Consideration that there was a difference between whether EEL was a priority service and the reasons listed for the Mayor’s decision. However there was no merit in duplicating the discussion at full Council as it had reached a decision, passed by two thirds majority. The issue needing addressed was whether it was right to reverse that decision through the virement. Responded that the decision of full Council had been erroneous, as the proposals had not been properly evaluated, with all important issues taken into account. The decision had been taken as the politically motivated Budget amendment, intended to undermine the Mayor, had resulted in collateral damage to vulnerable sections of the community who relied on EEL.
· Why had this decision not been placed on the Authority’s Forward Plan for Cabinet decision if there were significant concerns regarding the Budget reduction. Responded that the information was not new and already in the public domain. The criteria for a key decision had been weighed when the decision was made: the political sensitivity of the matter was erroneous, being based on malicious politics. The impact of the virement had not been considered significant in terms of impact on 2 or more wards. The consequent rationale of “Call-in” Members that the decision was Key, was therefore not accepted.
· Council employees had a legitimate expectation of continued employment, and if redundancy was proposed, consultation on such matters with staff and trades unions should take place; it was also reasonable for the Mayor to have time to consider the alternative options to EEL. If a timescale for this review and consultation was proposed and funding provided for that period, the virement decision might appear more reasonable. However the virement proposed a sum identical to the annual EEL budget, withdrawn by Budget Council, be re-included. This was a reversal of the full Council decision and contravened constitutional process. What was the rationale for a virement of £433k and what was the timescale for the review. Responded that the Mayor was doing what he considered necessary to undertake a review of the options relating to EEL, and allow time for any reprocurement; and it had been considered appropriate to provide the staff of EEL with security and stability for a year whilst this took place.
Councillor Gibbs and Councillor Choudhury withdrew from the meeting room at the commencement of OSC deliberations on referral/ non-referral of the “Call In”, being 8.15pm.
A discussion followed which focused on the following points:-
· The positive value of EEL for communicating information to residents of the borough and the socially inclusive nature of this outreach. Also the need for cross party co-operation on editorial content if EEL continued. Also, however, that the Budget Council discussion in support of withdrawing funding for EEL, did not focus on the quality of the EEL service, but whether it’s £0.5million budget was a priority for the Authority in the context of unprecedented cuts.
· Consideration that the decision was in contravention of the Budget and Policy Framework, agreed by a two thirds majority of full Council, and for the Mayor to attempt to work around this through the virement was unconstitutional and made a mockery of the Budget setting process; accordingly proposed that the Monitoring Officer and Chief Finance Officer/ Section 151 Officer should be requested to provide advice on this in a report as set out in the Constitution. Also proposed that this report and deliberations of the OSC in relation to this Mayoral decision making be placed on the agenda of the full Council meeting to be held on 17th April 2013 at the request of the Chair of the OSC. Noted that the report may come to OSC for consideration prior to consideration by full Council.
· The OSC was advised by Mr Galpin, Head of Legal Services Community, that the OSC could refer the “Call In” of the Mayoral Decision back for further consideration. However, the OSC could not, at this point in time, refer this matter to full Council under the provisions of Rule 7.3 of the BPF rules in the Constitution, as the advice of the Monitoring Officer and Section 151 Officer that the decision was contrary to the Authority’s BPF had not yet been obtained. The Chair responded that she had received senior officer advice, that as OSC Chair she could request a report be placed on the full Council agenda, and if this was not so the report to OSC should have advised otherwise. Also regardless of any referral on the basis that the mayoral decision was contrary to the BPF, as OSC Chair she could place the matter on the full Council agenda as a complaint regarding the way the matter had been handled.The Vice-Chair concurred that a referral to full Council should be made on both counts.
· Consideration that there was a lack of clarity on the decision making on whether the decision was ‘key’ or ‘non-key’. Also Councillor Choudhury’s response on the importance of EEL to vulnerable elements of the community indicated a significant impact in all wards. The decision appeared “key”, given its significant impact on the borough, given it was politically controversial and given the substantial public interest shown. Accordingly proposed that the report requested from Monitoring Officer and Chief Finance Officer/ Section 151 Officer should include advice on the the validity of the determination that the decision was not key.
· Commented that a Bill in the new session of Parliament was likely to include the current guidance on operation of local authority media on a statutory basis, resulting in EEL having to be abolished. OffCom had previously rejected the rationale used for maintaining a Council publication, and therefore examination of that rationale was merited by Officers. Commented also that costs would arise from the enforced closure of EEL
· Consideration also that any referral of the Mayoral Decision should acknowledge the legitimacy of consultation with staff and the trades unions where proposals involved redundancies; and if a virement to continue EEL, linked to a consultation timetable, and therefore of a smaller amount than the EEL annual Budget, the OSC was supportive of that.
· Consideration that full Council had fully weighed the implications of withdrawing funding for EEL. Also that the credibility of EEL had been compromised as it the message it conveyed was not entirely corporate.
The Chair Moved and it was:-
Resolved
1. To refer the decision of the Mayor outside Cabinet back to the Mayor for further consideration;
2. That the Monitoring Officer and Chief Finance Officer/ Section 151 Officer be requested to provide a report, as set out in Rule 7.2 of the Budget and Policy Frameworks Rules of the Authority’s Constitution, containing their advice as to whether the decision of the Mayor outside Cabinet was in contravention of the Authority’s Budget and Policy Framework. Also that the report include their advice on the the validity of the Mayor’s determination that the decision was not ‘key’;
3. That the report referred to at Resolution 2 above, and deliberations of the OSC in relation to the Mayoral decision making in this case, be placed on the agenda of the full Council meeting to be held on 17th April 2013 at the request of the Chair of the OSC; and
Action by:
Isabella Freeman (Assistant Chief Executive – Legal, CE’s)
Chris Holme (Acting Corporate Director Resources)
Alan Finch (Service Head Financial Services Risk and Accountability)
Councillor Gibbs and Councillor Choudhury did not return to the proceedings following OSC deliberations on referral/ non-referral of the “Call In”.
Supporting documents:
- 5.1 Callin cover report Mayor Decision Log No 21, item 5.1 PDF 108 KB
- Appx 1 - Mayor Decision Pf Log 0021BudgetImplementation201314, item 5.1 PDF 122 KB