To receive a report from the Chief Officer Finance and Commercial.

Councillor JG Jarvis, the Leader of the Council presented the report, pointing out an correction in recommendation (c) which should read 10.61 and 10.62 rather than 10.58 and 10.59 respectively.  Councillor Jarvis made the following points:

 

·             There is a challenge to all Local Authorities to address the national debt. Tough decisions were needed for tough times, which will continue well into the decade.

·             The Council will have to save £9m in addition to the £21m saved in the last 2 years . The Country is in the middle of the largest reduction in public services known.

·             The budget is phrased around the key proposals defined in November 2012.  The Council is committed to enable residents to carry out fulfilling lives with an accent on  resources being used to support the most vulnerable.  When drawing these up the Council has taken into account a wide range of evidence including feedback, which  will shape how matters are taken forward , to ensure that the Authority works with the community and commit to those organisations that make the most difference.

·             The Authority is  dealing with a £331m yearly budget and need to make the most of the changes to the way  funded and need to particularly work on the way employment takes place in the County. Consideration was given as to  whether to take the Government’s offer in respect of a Council Tax freeze however it has been  decided to make a 1.9% increase on Council Tax this year which is equivalent to a 44.4p increase per week for a Band D property.  This is the first increase since 2010/2011.

·             In the forthcoming years and the short to medium term the Council must complete delivery of the Enterprise Zone at Rotherwas to stimulate Economic growth which generates income which supports the 700 plus services delivered; This will help in supporting key services.

·             This is the third year of the Coalition Government’s reduction programme and there has been a 3% reduction in funding .Indications are that Government is now aware of  the particular problems of rural Counties due to the lobbying that has taken place.

·             The issues facing social care budgets across the nation are well known but Herefordshire must continue to have a substantial social care budget .

·             The Capital Programme shows that we want to continue investment  in the County .

·             The Council wishes to continue to pursue its carbon reduction programme.

·             It is up to all of the Council to support those officers dealing with the budget and we will continue to support the most vulnerable in the County, together with the economic development that makes the County viable.

The Leader then invited Councillor Johnson, the Cabinet Member for Financial Management, to address the Council on the report and moved that Council accepts the budget.

 

Councillor Johnson stated:

 

·             The demand for services has grown despite  funding  being cut.

·             The choices made will have a more noticeable effect on protecting the vulnerable and stimulating growth .

·             The Cabinet thanked the Public and Officers for the feedback from the ‘Your Say, Your County,’ consultation. 

·             Herefordshire gets 13% below the national average of funding per head (£311 as opposed to £358), similarly our level of Council Tax is below the Unitary Authority average.  Lower business rates are charged.  There was £5.5m less funding in 12/13 than there was in 11/12.

·             The Council believes that the 1.90% increase in Council Tax is a better option than opting  for the Government grant for 2 years as a significant increase in Council Tax will be needed when the grant ceases .

·             There continues to be an estimated overspend, so we have prudentially included a loan of £2m from reserves.

·             The way forward is not just cuts and efficiencies but growth in income; the Cattle Market and other projects will ultimately bring more income into the County.

·             There are risks in all budgets, but there is a belief that this one is achievable.  It has been through Overview and Scrutiny, observations of whom we are pleased to include.

·             Particular thanks were extended to the Acting Chief Executive and the Chief Officer Finance and Commercial for their help.

Councillor Johnson formally seconded the motion.

 

In the ensuing discussion, the following points were made in relation to various headings:

 

The Voluntary Sector:

 

·             There was a concern that now was the time to reward the sector, not make cuts to it. 

·             This was a huge resource and it was suggested volunteers be rewarded for their work (e.g. free parking).

·             The Council does provide funding to the voluntary sector including HVOS. 

Adult Social Care:

 

·             That this has failed to deliver on budget for many years.

·             That care home and nursing home contracts are not being managed effectively, so money was being wasted.

·             That there was lack of consideration of long term consequences.

·             That the targets are unsustainable and would therefore result in cuts being made to other departments.

·             That the Health Overview and Scrutiny Committee acknowledged the risks in the proposed Budget but did not request revision of it as a result.

Energy:

 

·             That there was no concise Energy Strategy.

·             That the Council should have considered the options in respect of PV Cells when returns on such investment were good several years ago.

Waste Management:

 

·             There was a risk in escalation of costs.

·             There were concerns that there was a lack of detailed information in respect of costs.

·             That waste should start to be considered as a resource and what returns could be obtained from it.

Educational Psychology Service:

 

·             There are those having already waited over a year for a referral and this could only be made worse by cuts.

Herefordshire Matters:

 

·             There were concerns that the Council could no longer afford this publication.

·             It was confirmed that it would be discontinued with a resultant saving of £80k per year.

Tourism:

 

·             Concerns were expressed about the cut in funds, for ‘Visit Herefordshire’, it was pointed out in 2008 £411m was generated by tourism, 11% being day visitors resulting in a spend of £27.60 per person.

·             That Herefordshire contained unique qualities, farm shops, crafts etc and that 8496 jobs were tied into tourism.

·             Now was not the time to cut funding but to invest in it.

·             It was confirmed that support would continue for the Flavours of Herefordshire Event, despite its £40k loss to the promoters as it represented an important focal event.

Cultural Services:

 

·             That these contribute to the quality of life.

·             That organisations like the Courtyard are committed to outreach work which if it didn’t take place would represent another call on the Council budget.

·             For every £1 invested there is a £4 return.

·             Many British cities that have committed to an arts and culture regeneration have benefitted generally from this (e.g. Glasgow, Belfast, Cheltenham).

·             That consideration of setting up a staff mutual to deliver these services should be considered.

·             That Halo have had recent dealings with the Council very much to their advantage regarding the budget.

·             That Hoople is not the same organisation as it was when established due to the  decommissioning of PCTs . However, Hoople was taking on the savings targeted to them whilst pursuing new business.

Council Tax Increase:

 

·             That whilst unpopular may be more accepted by the public if the reasons behind it more fully explained to them.

·             That the County does not have a high percentage of employment and also has a high percentage of low paid workers.  The Council will therefore continually find itself chasing up poor payers and the reduction scheme should reflect this.

·             That the budget was on a ‘knife edge’ and a fall in collection rates would have a severe impact.

·             That the public would be more accepting of an increase if services were at least continuing.

 

Youth Services:

 

·             That the £1½m savings targeted for the next year was serious, and that front end services help prevent costly intervention in later stages.  The long term consequences would come back on the Council.

·             That it would be better to direct funds to youth services than to the access road.

·             That a lot of youth service resources are still on offer..

 

The Link Road:

 

·             There are concerns over potentially spiralling costs.

·             That cheaper options had not been considered.

·             That this was a ‘road to nowhere’ which no-one wanted or needed.

·             That a smarter attitude about funding could mean the road was paid for by any housing development at Merton Meadow.

·             That if there is no link road, there can be no new houses built in the city centre.

In general discussion:

 

·             That Overview and Scrutiny Committee would continue to have a robust role in monitoring the budget.

·             That there were doubts that the £1.4m savings from Root and Branch, and Hoople was achievable.  The budget document has not stated how the Root and Branch exercise will reduce demand.

·             That because the budget is unachievable the history of overspend in adult social care will continue, having achieved only £3m of the £8m savings for the current year, resulting in a £5m carry over.

·             There were concerns at the depletion of and rate of depletion of reserves, £8m of Council Assets had been sold already and there were concerns there could not be enough reserves to cover shortfalls in the budget for next year.

·             It was suggested that the current administration had neither sought adequate funding to slow the rate of change, nor alternatively changed priorities or policies to fit the circumstances.

·             That there had been no suggestions of an alternative budget as budget setting at the present time was extremely unpleasant and difficult.

·             That seminars, workshops and briefings were held, briefing notes were distributed and explanations and workshops were held and meetings with Overview and Scrutiny and Cabinet and numerous meetings with the Root and Branch Group; no budget has had as much involvement as this one.

·             That the budget is drafted as one for demand driven services.

·             That in view of the lack of suggestions for delivery of a balanced budget  Councillors were urged not to use abstention as a means of distancing themselves from any blame.

·             That in view of the global economic crisis the whole Council should pull together behind this budget.

A named vote was requested in accordance with Paragraph 4.1.16.38 of the Constitution, in respect of the Motions.  For each motion being proposed and seconded, the vote was taken as follows:-

 

Motion (a):

 

For: 32

Councillors: AM Atkinson, C N H Attwood, L O Barnett, P L Bettington, A J M Blackshaw, H Bramer, A C R Chappell, M J K Cooper, P G H Cutter, B A Durkin, D W Greenow, K S Guthrie, R B Hamilton, J W Hope MBE, R C Hunt, J A Hyde, JG Jarvis, A W Johnson, Brig P Jones CBE, J G Lester,  R l Mayo, J W Millar, P M Morgan, N P Nenadich, R J Phillips, G J Powell, P D Price, P Sinclair-Knipe, J Stone, D Taylor, P J Watts, B Wilcox

 

Against: 11

Councillors:  E M K Chave, EPJ Harvey,A J Hempton-Smith, M A F Hubbard, J L V Kenyon, M D Lloyd-Hayes, S M Michael, C Nicholls, F M Norman, A J W Powers, R Preece

 

Abstain: 11

Councillors:  P A Andrews, C M Bartrum, W L S Bowen, P J Edwards, T M James, R I Matthews, P J McCall, G A Powell, S J Robertson, A Seldon, G R Swinford

 

Motion (b):

 

Unanimous

 

Motion (c):

 

For: 31

Councillors:  : AM Atkinson, L O Barnett, P L Bettington, A J M Blackshaw, H Bramer, A C R Chappell, M J K Cooper, P G H Cutter, B A Durkin, D W Greenow, K S Guthrie, R B Hamilton, J W Hope MBE, R C Hunt, J A Hyde, JG Jarvis, A W Johnson, Brig P Jones CBE, J G Lester, R L Mayo, J W Millar, P M Morgan, N P Nenadich, R J Phillips, G J Powell, P D Price, P Sinclair-Knipe, J Stone, D Taylor, P J Watts, D B Wilcox

 

Against:12

Councillors:  EMK Chave, E P J Harvey, A S Hempton-Smith, M Hubbard, J L V Kenyon, M D Lloyd-Hayes, P J McCall, S M Michael, C Nicholls, F M Norman, A J W Powers, R Preece

 

Abstain: 11

Councillors:  P A Andrews, C N H Attwood, C M Bartrum, W L S Bowen, P J Edwards,T M James, R I Matthews, G A Powell, S J Robertson, A Seldon, G R Swinford

 

RESOLVED:     that

 

(a)        the Medium Term Financial Strategy (MTFS) shown in Appendix A, which includes the 2013/14 Budget and Treasury Management Strategy and Policy Statement be approved;

(b)       a Council Tax increase of 1.9% for 2013/14 be approved; and

(c)        the Capital Programme outlined in paragraphs 10.61 and 10.62 of the report be approved.