Agenda item

a)          Budget Scrutiny Working Group – Chair, Councillor Kane

b)          Performance Scrutiny Working Group – Chair, Councillor Kane

Councillor Kane reported that a Budget Scrutiny Working Group meetings took place on 3^rd and 31^st January 2023 respectively. Councillor Kane informed the Committee that she had prepared a report on the matters discussed at the 31^st January meeting. This was read out to the Committee, with the main points noted as follows:

·       At the 31^st January meeting, the Budget Scrutiny Working Group discussed the Medium Term Financial Plan 2023/4 to 2025/6.

·       The overall conclusion was that in order to continue to build reserves to fund transformational changes, the Council must continue to drive down its expenditure.

• The 2022/3 pay award delivered to staff in December and the impact was expected to be £928k, however, the actual impact on budgets was £200k less than expected. This was mainly due to staff vacancies.
• Reviewing all the capital programme schemes. The Working Group requested an updated list of schemes that would not be going ahead for 2023/24.
• The Council was looking at cuts in services and jobs for 2024/25, otherwise the budget might not be sustainable. The council would have to change the way it works and a large part of this will be changes to the back office. A working group had been set up to implement this – the aim was by April 2024.
• The Council had set up an Earmarked Reserve for Utilities Pressures. This reserve might be drawn upon for additional costs for the new fuel to make council vehicles environmentally friendly – estimated at £130k. A total of £1.710m had been reallocated to a Utilities Reserve and £1.508m transferred to the General Fund. Most of this funding had come from the Covid-19 Reserve (£0.941m) and the Business Rates Retention Reserve (£1.500m).
• The extra 1% on Council Tax allowed in the Chancellor’s Statement was worth £69k to the Council.

Councillor Kane then reported on significant risks to the medium-term budget that the Council needed to manage:

• The council had not yet closed its 2021/22 accounts. This was not expected to happen until the summer.
• The 2022/23 monitoring was showing an overspend position of £1.424m. This needed to be managed down because it would take out half the present General Fund balances.
• If the Towns Fund and UK Shared Prosperity Funds programmes were not completed by the timescales specified by the Government, the Council would have to pay for whatever work was needed to finish the projects.
• The Council needed to find a way to start to build back the General Fund Reserve to the best practice benchmark of 5% of gross spending (which would be £1.25m as net expenditure is around £25m). The intention was that the Council needs to do more than this and move to build back the reserve close to 9%. This was because 5% would not cover the level of overspend being reported for this financial year.
• An estimate on future Government settlements had been made for 2024/5 and 2025/6 based on historic data. The net Government funding of £468k was in line with previous years’ equivalent grants but an assumption had been made that Grant levels would remain at the net level of £450k for the 2nd and 3rd years of the 3-year plan.
• The Council had a significant portion of its tax base in the bottom three Council Tax bands. This meant that council tax revenues were lower than the ‘average’ council but there was a higher requirement for council services in the Borough due to a higher proportion of lower income households. This situation had become far more acute with the present cost of living crisis.
• Loss of key Council employees, with the average age of staff being 49. The concern was that a large number of people could retire at the same time.
• Business Rate Income – especially with the 1^st April 2023 revaluations, actual income received will vary depending on actual Business Rates growth, and levels of appeals. There was also an issue with collection this year being under target as a result of the cost of living crisis.
• The ongoing impact of inflation, especially around utilities. The Council’s “Corporate Buildings” including leisure buildings for the delivery of services directly to the public were highlighted as a particular risk.

Councillor Kane highlighted actions recorded from the Budget Scrutiny Working Group meeting which included providing Members with a clarification on Paragraph 3.38 of the report to theExecutive Committee on the Medium Term Financial Plan 2023/4 to 2025/6, which included the sentence: ‘The HRA Rents were set at Executive on the 10^th January where a 7% increase in rents will be made over the next two years.’ The Working Group asked for a clarification to be made to the Executive next Tuesday because the 7% increase had been made for one year, not two.

Following the verbal report on Budget Scrutiny Working Group, Councillor Kane provided an update with respect to the Performance Scrutiny Working Group which took place on the 11^th January 2023. Councillor Kane read out her update report, the main points of which were as follow:

·       Officers at the meeting provided an update with respect to Local Environment including landscaping and trees.

• All tree enquiries were assessed on their own merit and any health and safety issues were top priority; Officers aimed to deal with all enquiries as quickly as possible.
• The majority of the tree works were currently carried out by about 10-12 external providers via a framework contract.
• The Place Teams also carried out minor tree works and aimed to carry out proactive work in the winter with the intention of reducing the number of enquiries receive.
• All tree related insurance claims were dealt with as a priority and Tree Officers worked closely with Legal Services and the Council Insurance Officers. Claims of this type, which related to properties, usually took long to resolve, and required detailed investigation before any claim could be challenged or settled. Such claims were small in the number; three to four claims a year was typical.
• The Council was the administrator of Tree Protection Orders and had a duty to protect trees under these orders.
• We also discussed plans for tree removal and planting over the next few years.
• At the meeting, Members raised questions over the length of time it took to process complaints or issues with trees – whether reported delays of up to 18 months were improving, and what communication there is with residents who have made enquiries or complaints. Officers were currently pulling together further information on this.
• Other questions included queries about the management of ash dieback, what happened to the wood (where possible the timber was sold to go into a funding pot to help manage woodlands), and potential funding for replacement woods.
• Members also discussed clearing wood after trees have been felled and the challenges this can present, for example if the land was too wet for heavy machinery to take the trees away immediately after completion of work.
• The agenda for the next meeting of the Performance Scrutiny Working Group, included discussion around Events and a review of the work of the Group during the municipal year.

RESOLVED that

the Task Groups, Short Sharp Reviews and Working Group Update Reports be noted.