Cabinet Budget Proposals - Presentation

Cabinet Budget Proposals 2014/15

Vicki Palazon Financial Services Manager

We remain committed to:• Growth, regeneration and economic development of the city to bring new investment and jobs • Improved educational attainment and skills for our children and young people including investing in the multi-university approach • Safeguarding children and vulnerable adults • Environment Capital agenda including pursuing new income streams from solar energy and wind farm developments • Supporting our Culture and Leisure Trust to continue to deliver our culture, arts and sport in the city • Keeping our communities safe and cohesive

City achievements – just a sample • GCSE results which were sixth most improved in the country • National recognition for response to child sexual exploitation case • attracting new investment into the city - creating 3,500 jobs • one of the lowest shop vacancy rates in the country (9%) compared to a national average of 14%

Settlement 2014/15 and 2015/16 • 2014/15 – Grant will be £9m less previous year – roughly £1m worse than expected when budget planning started

• 2015/16 – Grant will be £12.5m less previous year – roughly £11.5m worse than expected when budget planning started – Local Welfare Reform grant £0.8m…..

• Overall reduction of nearly 40% (£44m) across 5 years

Pressures • Looked after children (£1m) • Government changes to provision for adults with learning disabilities in residential care (£945k) • Homelessness B&B costs (£150k) • Special school transport (£164k) • Government changes to funding of long term Social care (£319k from 2015/16) • Welfare reform – responding to loss of Disability Living Allowance in adult social care (£108k)

Capital Investment on key projects • • • • • • • •

Extra care provision Disabled Facilities Grant Repairs Assistance Roads, including junction 17 of A1m to junction 2 of Fletton Parkway and Bourges Boulevard Continuation of public realm, inc. Long Causeway Affordable Housing - £12.8m over 2 years Schools - £45m over 2 years for new places Renewables – income built into future years budgets

Scale of the financial challenge •

•

Summary position for 2014/15: – Grant reduction of £9m – Financial pressures of £10m – Overall budget gap of nearly £19m Gap increases in 2015/16: – Grant reduction of £12.5m – Financial pressures of £4m – Budget gap increases by £16.5m

Budget Gap - cumulative Budget Gap - annual change

2014/15

2015/16

2016/17

2017/18

2018/19

£m

£m

£m

£m

£m

-18.6

-35.1

-38.3

-40.0

-42.3

-16.5

-3.2

-1.7

-2.3

Meeting the financial challenge 2014/15 2015/16 2016/17 2017/18 2018/19 £m Revised Budget Gap

£m

£m

£m

£m

-18.6

-35.1

-38.3

-40.0

-42.3

2.3

1.0

-0.6

-0.9

-1.2

12.8

12.1

11.7

11.7

11.1

Service Reductions

2.7

3.1

3.1

3.1

3.1

Additional Income

0.5

0.5

0.5

0.5

0.5

Terms and Conditions

0.3

0.6

1.1

1.7

2.3

MTFS Position

0.0

-17.8

-22.5

-23.8

-26.5

Council Tax + Other funding Efficiency

Efficiencies • ASC transformation and personalisation (£637k) • Reduced costs of looked after children (£245k increasing to £1.2m) • Public Health - Savings on drug treatment and benefits from joining services to use grant more effectively (£1.1m) • Office accommodation and property (£673k) • Serco partnership and business support (£775k) • ICT projects and support (£602k) • Vivacity (£330k) • Youth offending (£50k)

Service Reductions (1) • •

•

Communities – Childrens centres (£1.18m in a full year) Adult Social Care – Further savings from previously agreed policy changes (£200k) – Review ‘support cost estimate’ (personal budgets) - (£125k) – Review respite policy (£150k) – Review older peoples day services (£150k) – Service User transport (£175k) – Day opportunities for adults under 65 with learning disabilities (£400k) Education – Special school transport (£60k)

Service Reductions (2) •

Governance: – Community Leadership Fund – reduce to £1k per councillor (£183k) • Resources – Remove remaining discretionary funding from parish councils from 2015/16 (£101k) – Sports club caretaker, grass cutting, shrub & flower bedding, play area inspection, WEEE facility (£262k) – Introduce charge for garden waste collection (£804k) • Equalities Impact Assessments developed

Council Tax (1) • One of lowest council tax levels in the country • Previously approved Budget assumed 2% per annum increase (i.e. at current referendum limit threshold) • Proposals put forward are on the following basis: – 2014/15 - Council Tax frozen – 2015/16 - Council Tax frozen

• Lose freeze grant if we increase. Potential impact: – 2% increase costs taxpayers roughly £1.2m – Grant loss around £0.7m – Net benefit around £0.5m

Council Tax (2) • Council tax benefit scheme kept at 30% reduction (approved by Council – not part of budget proposals).

– Otherwise extra £2m of savings

Reserves, balances and risk • • • •

£6 million working balance is maintained Capacity building reserve – low Tight financial control even more important Key risks: – Business rate retention – impact if Government growth targets are not hit, appeals etc – Savings plans – Council tax benefit

Reserves Estimated balance at 31.04.14 £k

Estimated balance at 31.04.15 £k

Departmental reserve – The majority of this reserve relates to City College Peterborough who operate on academic year funding and retain a reserve for potential claw back from awarding bodies

632

508

Schools capital expenditure reserve - Monies held on behalf of schools for capital spend

381

381

Insurance and other minor reserves – These reserves are held for a specific purpose and cannot therefore be used for budget setting purposes

3,350

3,259

TOTAL earmarked reserves for specific purposes

4,363

4,148

General fund – Set aside to meet unforeseen issues and risks

6,000

6,000

Capacity building reserve – This enables us to implement saving proposals

2,746

1,483

Earmarked reserves

Next steps • Monday 24th February - Cabinet (make recommendation to Council on the budget) • Friday 28th February (10.00am) – Substantial budget amendment / alternative budget • Wednesday 5th March (noon) – Minor budget amendment • Wednesday 5th March – Full Council agree budget