Agenda item

The Leader introduced the report which provided information on the revenue budget for the next financial year and the Council Tax recommendation.

 

The Leader thanked her Cabinet colleagues and Officers for their hard work on the preparation for the budget, work which has been on-going since the autumn 2018.

 

The Leader also confirmed the administration means to build on its successes to date within a most challenging period.

 

The draft budget was agreed at the 2018 December Cabinet when it consulted on a 6.95% Council Tax rise and about £6.5m of savings.  At that time the increased funding from Welsh Government was not confirmed (the Revenue Support Grant funds 77% of the Council’s budget) and further cost pressures would also need to be considered.

 

A period of consultation has now taken place on the proposals which included key issues raised in scrutiny, fairness commission, school forum, the trades unions and with the public.

 

There has been a 21% increase in public feedback.  In addition to the public on-line survey, a survey on the Council Tax rise was carried out via the city’s bus wi-fi network; this survey achieved nearly 4,000 responses on that single issue.  The information gathered from the surveys are included in the Appendices to the report.

 

Some key points coming out of the consultation: 

 

·         All understood and were sympathetic to the real challenges in Local Government funding and cost pressures;

·         On the proposals on which the Council consulted, differing views were offered in the feedback, but there was more support for the proposals in all bar one area, as reflected by the higher percentage of answers supporting the proposals.

·         On the issue of the draft Council Tax increase, the online survey received more answers saying it was too high; the on-line bus survey received reflected more people agreeing the increase was about right or not enough. 

·         School funding remains a challenge which was reflected in the feedback received from individual schools and teaching groups;

·         On individual proposals, the savings proposed in the education service, in particular ‘education welfare officers’ was raised consistently in different forums.

The Leader took the opportunity to thank the public for their response to the consultation.

 

Changes that have been identified since the 2018 December Cabinet are:

 

£3.2M additional funding received from a better final revenue grant increase of nearly £600k;

Approximately £2M on specific grants;

Increase in the tax base of just over £600K 

A further investment of nearly £1.9m on top of that identified in December is also included in next year’s budget in order to provide support for the most vulnerable residents.

 

The Leader confirmed that following the consultation Cabinet now proposed that:

 

The Council Tax increase will be reduced by 1% - from 6.95% to 5.95% - this 1% cut will be paid for from £500K of surplus;

 

The balance of the surplus will be used to retain 3 of the 4 Education Welfare Officer posts and the full time Educational Psychologist post will also be retained.

 

The increase to Residents’ Parking Permit Fees will be deferred until July when the Council will commence its civil parking enforcement service

 

The Leader confirmed she had written to the Leaders of the Gwent Local Authorities to offer an extension to the withdrawal period for the regional SENCOM service, subject to an independent review of the service and costs. The one year extension will be funded from the current year’s revenue underspend and will be confirmed and implemented once all Councils have replied.   

 

The Leader emphasised some of the key messages within the budget:

 

·         The budget confirms the Council’s excellent track record of good financial management, investing in the key budget risk areas whilst protecting as much as possible the Council’s financial resilience.

·         The administration continues to be ambitious in what it wants to deliver for the city: regeneration, better service delivery, protecting the most vulnerable in society, all being delivered under extremely difficult circumstances.  

·         Continuing to invest, over and above annual inflation cost increases, in those areas which are needed to protect the most vulnerable residents.

·         Council Tax funds around 25% of the net budget therefore it is necessary to also make savings and changes to the services being delivered.

·         Following on from the public consultation the most pressing issues highlighted have been taken on board.

·         Council Tax. The Leader announced that the Cabinet has listened and the rate for 2019/20 has been reduced. 

·         Council Tax in Newport still remains relatively low compared to the rest of Wales.  The proposed increase amounts to:

 

§  £0.94 increase per week for Band B properties;

§  £1.08 increase per week for Band C properties;

§  £1.21 increase per week for Band D properties.

·         The £10.5m in savings needed for 2019/20 is being funded through nearly £7m of savings and nearly £3.5m in Council Tax income to ensure the burden is not solely on Council Tax;

·         £3.9m significant investment into social care

·         £1.7m into special education provision

·         £3.6M increased funding into schools;

·         Revenue Settlement Grant increased by only £600K

·         This Council will continue to spend much lower than its standard spending assessment – about £8m lower which is due to the lower Council Tax, but will still maintain its performance,  continue to make real improvements in services and move forward on its key ambitions. 

The Leader confirmed it is the administration’s responsibility to decide on the detailed spending plans which will now go to full Council for approval. 

 

Decision:

 

Cabinet agreed to:

 

i)              Note the formal consultation meetings on the budget as outlined in section 3 and the feedback received, shown in appendices 1 to 4;

ii)             Note the equalities impact assessment summary on the budget proposals, shown in appendix 10;

iii)           The implementation of thefull four-year change/savings programme, including all budget investments and savings options (appendices 6 - 7), as summarised within the medium term financial projections (appendix 8), noting they are subject to on-going review and updating;

iv)           The 2019/20 fees and charges of the council shown in appendix 12.

 

With regard to the overall revenue budget and resulting council tax 2019/20, Cabinet agreed to:

 

i)              The Head of Finance’s recommendations that minimum General Fund balances be maintained at £6.5million, the confirmation of the robustness of the overall budget underlying the proposals, and the adequacy of the general reserves in the context of other earmarked reserves and a revenue budget contingency of c£1.5million;

ii)             The current level of Council Tax for Newport City Council and the monetary value of various percentage increases and how this compares to levels of council tax at other councils as shown in table 7;

iii)           Review changes to the draft budget proposals shown in appendix 9, and which are included in the list of budget investments and savings in appendices 6 and 7;

iv)           Recommend an overall net budget for the City Council and resulting Council Tax to the Council, noting that a formal resolution including the Police and Crime Commissioner for Gwent and Community Councils’ precepts will be presented to Council on the 26 February;

v)            Approve expenditure and use of the Invest to Save reserve in line with the summary shown in appendix 11b, noting they are based on detailed business cases reviewed by Cabinet at its December 2018 meeting.

 

All of the above proposals were agreed by Cabinet.  Cabinet agreed further changes in the meeting as follows:

 

i)              To reduce Council Tax increase recommendation to Council to 5.95%.

ii)             To amend the central education proposal and reduce this by £155k  to allow central education to retain 3 of the 4 EWO’s and the full time Educational Psychologist which would have otherwise been cut.

iii)           Delay the implementation of the residents’ parking permit increased fees proposal until the implementation of the Council’s civil parking enforcement service in July 2019.

iv)           Subject to agreement with other Gwent Councils, the education SENCOM proposal and saving would be delayed by one year because of an extension to the withdrawal period the Council had offered, subject to an independent review of the service and costs and to utilise reserves, generated from this current year’s underspending, to fund this over that period.

 

 

Cabinet recommended the budget is put to Council for consideration and decision at the next meeting on 26 February 2019: