To receive apologies for absence.

Apologies were received from Councillors PA Andrews, AE Gray and PM Morgan.

To receive any declarations of interest by Members in respect of items on the Agenda.

There were none.

To approve and sign the Minutes of the meeting held on 29 November 2010.

RESOLVED:   That the Minutes held on 29 November 2010 be confirmed as a correct record and signed by the Chairman.

To consider suggestions from members of the public on issues the Committee could scrutinise in the future.

There were none.

To seek the Committee’s views on the draft Medium Term Financial Strategy for 2011/14.

The Committee was invited to comment on the draft Medium Term Financial Strategy (MTFS) for 2011/14 and inform Cabinet of its views.

The Director of Resources presented the report.  He highlighted the following points:

·         Further information had been received on the Government’s financial settlement for schools.  This presented a challenging position for schools, with falling rolls leaving them facing a budget reduction.

·         The front loading of funding reductions placed significant pressure on funding in 2011/12.  The profile of reduction for Herefordshire was 13.3%, 8.6% and 1.9% for the next three years.

·         That the Council had been making preparations for a funding reduction for some time.  In 2009 a strategy had been developed based on an estimated 15% reduction in government funding over three years.  This had represented the best estimate of an approach to address the national deficit.  These figures were built into the 2010 MTFS agreed by Council in March 2010. However, the timing and extent of the budget reductions required by Government had changed.

·         The Local Government Settlement had been announced on 13 December 2010, one of the latest announcements in recent times.  This had complicated the production of papers for the Committee’s consideration as work on the preparation of the MTFS continued.

·         There was a net funding loss of £11.206m in 2011/12.  The Director outlined steps that had been taken by Directors to arrive at proposals to close the funding gap and the core principles and priorities, set out at paragraphs 15 and 16 of the report that had been used to identify the further savings required and the necessary service changes.

·         The budget setting principles were set out at paragraph 17 of the report.

·         The Government’s review of the funding formula had resulted in a net decrease of £2.7m in the Council’s grant.  The main variation resulted from changes to concessionary travel funding distribution.

·         That it was estimated that as a result of the budget proposals up to 250 posts would be deleted from the organisation (excluding schools).

·         That the current policy for the general fund reserve required it to be 3% of net revenue budget.  The total net budget for 2011/12 was £148.8m and would require a reserve of £4.5m.  In addition non schools specific reserves totalled £7.87m.  It was proposed that a specific financial reserve of £1m was established following a review of current specific reserves to meet potential financial pressures associated with the reduction in funding.

·         The effect of the changes to the funding formula on concessionary fares funding and the proposal that a sum of £550k was passported within formula grant and that temporary support of £1m was provided by temporary use of the current £2.774m Waste Reserve.  The 2012/13 budget would require this to be repaid and the base budget would be adjusted.  A reduction in expenditure on concessionary travel would still be needed.  This could be achieved by meeting guidance for availability of concessionary fares which would yield approximately £200k of savings.  These measures would protect concessionary travel funding and  ...  view the full minutes text for item 49.

To consider the draft Joint Corporate Plan.

The Committee considered the draft Joint Corporate Plan (JCP).

The Head of Policy and Performance commented that the JCP took account of the fact that fewer resources would be available in the future and focused in particular on local priorities the Council had to deliver.

The Cabinet Member (Corporate and Customer Services and Human Resources) stated that consultation with Partners on the content of the Plan had taken place but further consultation would be necessary and the Plan may also need to be reviewed in the light of the outcome of Council elections in May.

RESOLVED:   That Cabinet be advised that the Committee welcomes the aspirations in the Joint Corporate Plan, whilst noting the challenge in ensuring the delivery of the desired outcomes.

To consider the work programmes of the scrutiny committees.

The Committee considered the work programmes of the scrutiny committees.

RESOLVED:  That the current work programmes be approved as a basis for further development.