Agenda item

The Executive Board considered a report which brought together the latest proposals for the Revenue Budget 2019/2020, provided indicative figures for the 2020/2021 and 2021/2022 financial years and summarised the latest budgetary position giving an update on the budget validation, spending pressures, the Welsh Government final settlement and the responses from the budget consultation.

The Executive Board Member – Resources outlined to the Board a number of factors influencing the budget, including, the final settlement received from the Welsh Government on the 19^th December, 2018 that provided additional funding compared to the provisional settlement announced in October 2018. As a result of that additional funding, it had been possible to revisit some of the initial budget proposals and consider further options including, taking account of the latest pay award offer and supporting services that were demand led and faced continued pressure for service provision, such as Social Care. Whilst the final settlement for Carmarthenshire represented a slightly improved figure on the provisional settlement, it still remained a very challenging budget and represented a reduction in funding in real terms having regard to inflation and other price movements. Furthermore, the Welsh Government had only been able to provide figures at Authority level for one year, restricting scope in relation to medium term forecasting within the Medium Term Financial Plan. In particular, the Authority had to be aware of the Westminster Government’s Comprehensive Spending Review to take place in 2019.

The Executive Board Member advised that whilst the full details of the settlement were included within the report, the most salient points were that on an all Wales basis, the funding for Local Government had increased by 0.2%, with Carmarthenshire receiving a flat cash settlement on a like for like basis compared with 2018-19. Whilst the final settlement provided the authority with an additional £1.557m on the provisional settlement, it also came with extra responsibilities including changes in the rates relief scheme and funding to cover additional free school meals eligibility.

The Executive Board was also advised that whilst the majority of the specific grants had been maintained at a cash neutral value, the authority was, as was typical at this time of year, still awaiting confirmation of some significant grants which would support the budget plan particularly, in respect of both waste and sixth form funding. What was not typical, however, was the level of uncertainty regarding the funding of teachers’ pensions. Although informal indications were that the funding would be met in full, as was proposed in England, the uncertainty regarding payment in Wales placed a significant risk on the 2019/20 budget.

The Executive Board Member - Resources advised that the Director of Corporate Services had made a number of adjustments to some of the figures within the strategy as part of the normal practice as clearer and more information became available, with the current total validation adding some £11.3m to the budget. One of those adjustments related to Adult Social Care to meet the increased costs the Council would face as a consequence of the collapse of Allied Health Care and the subsequent decision to bring the service in-house. Although that had been completed with minimal disruption to service users, the 2019/20 budget would need to provide for the harmonisation of employee terms and conditions, including payscales.

As was the case in 2018/19, the most significant validation for the 2019/20 budget related to the pay award offer made by the negotiating body for employees providing a 2% pay award plus the introduction of a new pay spine from April 2019 that consolidated some of the existing spinal points and ‘ironed out’ some of the current random gaps between pay points. For Carmarthenshire, the lowest paid staff, who were already in receipt of the foundation living wage, would receive a 4.9% increase. It was noted however, that the pay offer did not apply to teachers who were covered by separate national pay arrangements with increases of up to 3.5% on September 2018 and future years providing a 2% annual award.

The Executive Board Member – Resources also drew the Board’s attention to the Council’s budget proposals, as at November 2018, that assumed a cash neutral settlement for schools. He advised that, as a consequence of additional Welsh Government support received as part of the settlement, the current proposals would not only add £1.8m of grant funding to schools but also a further £0.75m of core funding, taking the total budgetary increase to over £2.57m.

The Executive Board Member - Resources advised that in light of the Authority having benefitted from a more positive settlement than originally anticipated, and after allowing for changes in validation, the sum of £528k was available to make some critical adjustments to the budget strategy. Accordingly, the following amendments were proposed to be made to some of the report’s budget and efficiency proposals:-

·       The budget reduction of £32k for winter gritting be removed 

·       That £186k of the Rural Road Sweeping proposal be re-established to mitigate against the most severe impacts of the proposed reduction;

·       The proposed reductions to Youth Support Services and Educational  Pyschology be deferred by one year to recognise both the negative public response and concerns raised by councillors during the member seminar sessions;

·       That in recognising the pressure placed upon the car parking service an additional £160k be provided to allow for more flexibility in the service and to limit any parking charges increases across Carmarthenshire;

·       The Communities Department, over the next year revisits the proposal to close the Pendine Outdoor Education Centre and tries to identify a change in service provision, which would allow the facility to continue to operate whilst providing the cost reductions proposed;

·       The school meal prices be frozen for 2019/20

The Executive Board Member also referred to the negative sentiments received to the budget reductions on highways resurfacing and advised that the additional £1.5m grant per annum for three years secured by the Council, [as detailed in the five year capital programme] more than compensated for the proposed revenue budget reduction.

In concluding, the Executive Board Member recommended that the Council Tax increase for 2019/20 be set at 4.89% to enable the Council to deliver the strategy whilst having regard to the above amendments.

Reference was made to the year 2 efficiency proposal to amend the frequency of Council meetings from monthly to quarterly. It was suggested that as that proposal had not received wide spread member support, it be withdrawn and other avenues be examined to identify alternative ways of working.

Reference was also made to the efficiency proposal for Post 16 School Transport Policy whereby it was suggested the proposed efficiency savings for years 2 and 3 be withdrawn to enable a review to be undertaken of the usage, especially in regard alleged spare/ unused seats.

UNANIMOUSLY RESOLVED TO RECOMMEND TO COUNCIL:-