Agenda item

Neighbourhoods Budget Analysis

Please find covering report attached, Appendix A to follow.

Minutes:

The Strategic Director gave a presentation on this item and made the following points:

 

(1)        The report set out how money was spent and provided information on the functions that were covered in the Neighbourhoods Directorate;

(2)        £70 Million was provided in the General Fund, with £34 Million being ring-fenced to the Public Health Grant;

(3)        Neighbourhoods had successfully delivered its 2015/16 budget and was forecast to deliver its 2016/17 budget;

(4)        The current financial year was the last year of the 4 Year Medium Financial Strategy;

(5)        There were £2 Million re-structures being implemented following benefits realisation work but with savings already counted. Each Service Director had worked with Ernst and Young as part of its efficiency journey but this was now reaching the end;

(6)        The HRA is a separate account for the landlord function (largely funded from tenants’ rents) and could not be used to plug any hole in the General Fund budget. Major savings are needed to balance the HRA and priorities were being reviewed between the three major areas of spend: new build, existing homes and services to tenants;

(7)        Public Health – this grant is ring-fenced and comes from Public Health England. There had been discussions concerning the possibility of removing the ring-fence. There had been an in year reduction in 2015/16 of £2.8 Million. It was anticipated that there would be a 2.5% reduction year on year. At the moment, reserves were being used but discussions would be required as to how to deal with a reduced envelope of funding;

(8)        Details of the various types of expenditure were set out – employees, premises, transport, supplies and services, third party payments, transfer payments, support services and depreciation and capital financing;

(9)        The total budgeted expenditure was £325,799 and net expenditure for the General Fund amounted to just over £70 Million – the highest amount was in relation to employees, followed by transfer payments and then others;

(10)      Citizen Services - details of these services and their expenditure were set out;

(11)      Neighbourhoods and Communities – details of these services and their expenditure were set out. It was noted that the Net Budget was just over £41 Million. There was substantial expenditure in third party payments within this Service Areas

 

Councillors made the following comments and officers and the Cabinet Member for Homes responded as follows:

 

(12)      The information was extremely helpful;

(13)      Officers confirmed that the benefit cap would have an impact – it was estimated that transfers would decrease by approximately £20 Million;

(14)      There was a big potential for a knock-on effect to the Housing Benefit Fund which could have a knock-on effect on some services, such as the collection of rent;

(15)      Officers confirmed that there were some areas where the budget was under budget – for example, cemeteries and crematoria where income was obtained (ie head stones) and in areas such as Horticultural Services where plants were sold to other Local Authorities;

(16)      As benefits fall, the impact on the General Fund would become disproportionately large. It was important that there were measures in place in the future to deal with this. Officers confirmed that there was a Working Group looking into this. In addition, an organisation called Advice Plus had contacted everyone affected by Welfare Reform to assist directly with benefits but also to provide help in access to training and employment;

(17)      It was noted that there had been a very good housing Inquiry Day held in 2015. Following a request from members, officers agreed to provide a supplementary report setting out the current situation with the HRA following recent changes

Action: Nicky Debbage to arrange to be sent out

(18)      Officers confirmed that there had been hints in the Chancellor’s recent statement that the Public Health ring fence might be removed. If this did happen, the funds would be transferred into the General Fund;

(19)      This analysis was helpful in setting the framework for the decisions that the Council needed to take to assess what services could need to change and whether there were any services that could be stopped and provided in a different way.

 

Resolved – that the report be noted and the actions set out above be taken.

 

Supporting documents: