An update on income and charging focusing on identifying opportunities to improve the Council’s service cost recovery position.

CORRECTION: Please note that the title of this item was changed on 31/10/23 from ‘Service Cost Recovery Update’ to ‘Income and Charging’.

The Corporate Director for Economy and Environment introduced the item and provided the board with an update on income and charging, focusing on work that had been carried out in identifying opportunities to improve the Council’s service cost recovery position. The director stated that any questions that couldn’t be answered during the meeting could be taken away and responded to during the board meeting of 21 November.

Principle points arising from the update were:

·         The areas of opportunity examined included: moving services to a full cost recovery position, upscaling services, uplifting services and establishing new services.

·         Herefordshire had lower fees and charges than its comparators across 4 out of 7 categories assessed, there was potential to identify and implement changes within those categories.

·         There was no ‘fees and charges book’ or combined list of all Council fees and charges, but work had commenced to review this and put together a centralised record/source.

·         The initial review of “Service Cost Recovery” had shaped future priorities and work.

·         The review of fees and charges was on-going

The Scrutiny management board debated the update, principal points related to:

·         It was noted that scrutiny had looked at fees and charges back in 2011 and produced a set of recommendations for cabinet. The Corporate Director for Economy and Environment explained that these had largely been implemented in subsequent years, although the absence of a ‘service charges book’ may have made implementing some of the recommendations more complicated than was necessary.

·         The board acknowledged that this was an ongoing programme of work, but felt that additional detail around timelines and priorities (including identifying quick and big wins) of proposals and how they linked in with the 2024/25 budget and the policy framework would be helpful.

·         The board discussed the need for clearer examples to illustrate how income generated related to the services it supported, and cited car parking as a potentially good example for demonstrating this.

·         The board was keen to receive more information about the development of existing/known consultancy offerings that predated the recent involvement of PricewaterhouseCoopers.

·         The board discussed how fees could be used to drive and encourage positive behaviour - planning was given as an example - where a greater emphasis could be placed on seeking ‘permission rather than forgiveness’ in relation to retrospective planning applications.

·         The board enquired about the cost of the consultancy work carried out by PricewaterhouseCoopers and how/if the most recent work linked back with earlier consultancy work carried out by the firm.

The board voted unanimously in favour of the following recommendations to be considered in relation to the service cost recovery position, with a view to feedback being provided by the Corporate Director for Economy and Environment at the board meeting of 21 November 2023.

Resolved:

That:

a)    assurance be given on how income and charging items that are going to be built into the 2024/25 budget will relate to the policy framework, and

b)    detailed information on ‘quick wins’ ‘and ‘big wins’ be provided, and

c)    details of the priority order in taking work on income and charging forward be broken into a timeline of first, second a third tranches, and

d)    details be provided of the plans and timeframes for the piloting/development of consultancy offerings of which the council were already aware, prior to PricewaterhouseCoopers’ involvement, and

e)    a service charges handbook be compiled, including what the ambition and priority framework is in terms of what is expected for the budget for the coming year and what will then continue to be a work in progress, and

f)     parking charges be used as an example of how net income is linked explicitly to the service it supports, and

g)    consideration  be given to options, particularly in the area of planning, for fees to drive positive behaviours in the community, and

h)    assurance be provided that public money is not being used to subsidise the delivery of services that compete with the commercial sector, and

i)     assurance be given that Herefordshire Council will recover the cost of the consultancy carried out by PricewaterhouseCoopers and that a payback period will be identified for that.