Agenda item

(NOTE: Councillor K. Madge had earlier declared an interest in this item)

Council was informed that the Executive Board, at its meeting held on the 4^th February, 2019 (Minute 6 refers) had considered the revenue Budget Strategy 2019/20 to 2021/22 and made a number of recommendations, as detailed within the report of the Director of Corporate Services, for Council’s consideration.

Council received a presentation by the Executive Board Member for Resources, on behalf of the Executive Board, in which he set out the background to the budget proposals being presented to the Council for consideration.

The Executive Board Member advised that the report brought together the latest position on the Budget proposals, provided Council with the Executive Board’s recommendations and concluded with the Medium Term Financial Plan for 2019/20 to 2021/22. It also detailed the current position on the Welsh Government settlement taking account of the final figures, feedback on the consultation process and updates on growth and validation data.

He advised that the final settlement received from the Welsh Government, on the 19^th December, provided additional funding when compared to the provisional settlement announced in October. As a consequence of that slightly improved figure, the Executive Board had been able to revisit some of the original Budget proposals and consider further options, including taking account of the latest pay offer and supporting demand led services that continued to be put under pressure, for example Social Care. However, whilst acknowledging the slightly improved settlement, it still remained a very challenging situation and represented a real terms reduction. Furthermore, Welsh Government had only been able to provide figures at Authority level for one year, restricting the Council’s scope in terms of forecasting its 3 year Medium Term Financial plan. That was particularly relevant having regard to the Westminster Comprehensive Spending Review to be undertaken in 2019.

He highlighted some of the salient points of the settlement, the full details of which were incorporated within the report. 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 versus 2018-19, providing the authority with an additional £1.557m on the provisional settlement. However, that additional funding came with extra responsibilities including, changes in the rates relief scheme and funding to cover additional free school meals eligibility. 

He reported that whilst the majority of specific grants had been maintained at a cash neutral level, as was typically the case at this time of year, confirmation was still awaited on some significant grants which would support the budget plan, particularly in respect of both waste and sixth form funding. However, what was not typical, was the level of uncertainty around the teacher’s pensions funding. Although informal indications were that it would be met in full, as was proposed in England, the uncertainty posed a significant risk on the 2019/20 budget.  

The Executive Board Member advised that the Director of Corporate Services had made some adjustments to other figures within the strategy, as detailed within the report, being part of the normal routine as clearer and more information became available with the current total validation adding some £11.3m on to the budget. One of those adjustments related to the Adult Social Care budget arising from increased costs to the council following the financial collapse of Allied Healthcare, one of the Council’s service providers, and the subsequent decision to bring the service in-house. Whilst that had occurred with minimal disruption to service users, the 2019/20 budget would need to make provision for the harmonisation of employee terms and conditions, including pay scales.

He advised that the most significant validation related to the pay award offer made by the negotiating body for employers, providing for 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. As a consequence, the Council’s lowest paid staff, who were already receiving the foundation living wage, would receive a 4.9% increase.  The pay offer however, did not apply to teachers who were covered by separate national pay arrangements which had resulted in increases of up to 3.5% in September 2018 and a 2% annual budgetary provision for future years.

He advised that although the budget proposals, consulted upon in November 2018, had assumed a cash neutral settlement to schools, the Executive Board being conscious of the need to support schools wherever possible, whilst balancing the impact on other departments, was as a consequence of the additional support provided by the Welsh Government as part of the settlement, proposing that Council not only add £1.8 million of grant funding to schools, but that it add a further £0.75 million of core funding, taking the total increase to over £2.57 million.

The Executive Board Member also referred to the wide spread consultation undertaken on the budget which had provided feedback on the original proposals put forward.

He advised that as a consequence of the more positive settlement received from the Welsh Government, and after allowing for changes to validation, the sum of £528k was available to enable some critical adjustments to the budget strategy. The Executive Board was therefore recommending the following adjustments be made to the budget strategy which took account of the consultation process and responded to the feed-back from the proposals that were not supported:-

·       to remove the reduction in budget of £32k proposed for Winter Gritting. That proposal had a negative index score and could have impacted upon resident’s safety. 

·       to reduce the Rural Road Sweeping proposal down to only £100k, therefore re-establishing £186k of the budget, which would mitigate the most severe impacts.

·       to defer by one year the proposed reductions to Youth Support Services and Educational Psychology, recognising both the negative public response and concerns raised by councillors during the member seminar sessions.  

·       To provide an additional £160k to the car parking service in recognition of the contribution its makes to our thriving local economy, which would allow the service more flexibility to limit any parking charges increases across Carmarthenshire.

·       the Community’s 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.

·       School meal prices be frozen for 2019/20

Finally, he referred to the fact the Executive Board had not responded to the negative sentiments received to the proposed budget reductions to highway resurfacing. He advised that was not an error, as the additional £1.5 million grant per annum for 3 years which the Council had successfully secured would more than compensate for the revenue budget reduction, with the significant increase in spend having been included within the Capital Programme.

The Executive Board Member advised that adoption of the proposals would allow the Council to deliver a fair and balanced budget that responded to the major concerns fed back from the consultation process and provided significant extra resources to critical services. If adopted, the proposals would result in a Council Tax increase of 4.89% for next year that would allow for delivery of the strategy within the report together with the above proposed amendments that provided a balanced, sustainable and viable Budget Strategy and which:

·       Responded to the consultation concerns

·       Ensured, as far as possible that service levels and standards  are maintained

·       recognised that our citizens are finding it hard in the current climate and therefore minimised, as far as possible, any increase in the council tax

·       As far as possible prepared the Authority for any future reductions in funding that may lie ahead.

He thereupon moved the recommendations of Executive Board in respect of the Budget Strategy 2019/20, a Council Tax increase of 4.89% and approval of the medium term financial plan as a basis for the future years financial planning. The proposal was duly seconded.

Whilst the Council was presented with an alternative budget proposal that was withdrawn following advice by the Council’s Section 151 officer that its adoption would result in the setting of an unlawful budget.

RESOLVED