Agenda item

Purpose of the report:  Policy Development and Review

The report provides an overview of consultation practice, how officers are supported to undertake consultations and how this can be strengthened.

A revised Annex 1 was tabled at the beginning of the meeting.

Witnesses:

Denise Le Gal, Cabinet Member for Business Services and Resident Experience

Kevin Kilburn, Deputy Director of Finance

Key points raised during the discussion:

1.    The Chairman explained that this item would be taken first on the agenda as the Cabinet Member for Business Services and Resident Experience was due at another meeting at 10.30am.

2.    The Chairman explained that a financial sustainability and budget planning paper had been agreed at Cabinet on 20 September 2016 with all recommendations being agreed except recommendation 8 which had some minor changes made.

3.    The Cabinet Member for Business Services and Resident Experience briefly introduced the report to the Board. She explained that the Council was in a financially unprecedented situation and was facing great budgetary challenges especially with the adults and children’s social care budgets. There was great concern amongst the Cabinet and this had been raised with local MPs and the Chancellor of the Exchequer. It was further explained that the four year settlement decision would be delegated to the Leader after discussions with the Cabinet had taken place. The Cabinet were minded to refuse the four year offer even though originally it had been welcomed. Accepting the four year offer would mean Surrey tax payers would be funding other parts of the country in year 4 of the deal. The cabinet member also explained that the council’s budget planning is considering two scenarios – A&B, where A included the known pressures and savings while B included a £20m ‘shock’.

4.    A Member of the Board queried if it was wise for the Leader to take a decision regarding the four year settlement on his own without any consultation. Furthermore it was queried whether this decision would be taken in public. The Cabinet Member for Business Services and Resident Experience explained that discussions regarding the settlement had taken place with the Cabinet and the Leader is minded to refuse the offer, which would be discussed at Full County Council on 11 October, prior to a decision being made.The Cabinet are willing to speak with Members about this further. The Board were reassured that in terms of assessing risk the Leader would be consulting further with the Chief Executive. The Cabinet Member for Business Services and Resident Experience would confirm whether this decision would take place in public in due course.

5.    A Member of the Board raised concerns that a great element of what the Cabinet were pursuing relied on the Government having a change of heart even though it was clear that there were trust issues between both parties. Furthermore, there seemed to be no clear plans in place if the Council refused the settlement offer. It was further explained that the county was prepared for the worst case scenarios and the Cabinet had held a number of workshops to look into these scenarios. 

6.    Queries were raised around a potential additional 6% precept to adult social care. It was explained that there was no intention to have an extra precept and the 6% figure was being used to illustrate the level of demand faced by adult social care. There was potential to raise funding through the Municipal Bonds Agency although the Board pointed out that this was limited to capital not revenue funding. 

7.    The Board commented that although the Government was Conservative and so were all of the Surrey MPs, there was no greater sympathy towards Surrey County Council’s financial position. The Cabinet Member for Business Services and Resident Experience stated that the Cabinet had met all Surrey MPs regarding this matter so they can understand Surrey’s financial situation but they could only influence the Government to a certain extent.

8.    The Board asked for more clarification around the business rate consultation and what this would mean for the county. The Deputy Director of Finance explained that two consultation papers had been received on business rates. Currently 50% of local rates are delegated to the local authority and the remainder is retained by Government. If the Government was thinking about allowing local authorities to keep 100% of business rates they would look to pass on additional responsibilities. If the council was to be given an increase in business rate revenues it would insist that this was to firstly fund current responsibilities rather than taking on extra responsibilities.

9.    Referring to paragraph 34 of the report, the Chairman welcomed Cabinet’s recommendation requesting scrutiny boards to test the assumptions within proposals.  A Member of the Board raised concerns that finance sub group meetings had been set up to test assumptions but these had subsequently been cancelled as relevant information was not available. The Chairman stated that Members with any concerns around this should raise it with him.

10.  Referring to the revised Annex 1 some Members commented that the document was suggesting extra savings to be achieved in 2017/18 when in fact savings could not even be achieved in 2016/17. The Deputy Director of Finance explained that the two scenarios represented the case where the Council did not get any support from Government and could not meet financial pressures.

11.  It was explained that there was ongoing work to address the council’s financial concerns and Scrutiny Boards have the opportunity to scrutinise these proposals. A Member stated that it was important that Scrutiny Boards are involved in the process and are given the opportunity to comment on any plans. The Chairman reinforced the point that all Cabinet Members had been given cash envelopes within which to develop proposals which they would be bringing to each Scrutiny Board for feedback.

12.  The Deputy Director of Finance explained that there had been an increase to the Legal and Democratic Services revised cash limit for 2017/18 because of the upcoming County Council elections. Furthermore there had been an increase to the central income and expenditure budget due to the additional funding of capital programmes.

13.  There was concern raised by the Board regarding the Leader being given the delegated responsibility to make the final decision regarding the four year settlement offer.  Some Members also commented that they believed this decision should be made in public.  The Deputy Director of Finance explained that Cabinet had suggested that they would not be accepting the offer and the decision will be reported to full council. The section 151 officer cannot take any decision but can only advise the leader.

14.  The Chairman explained that although Cabinet agreed all recommendations in the report there had been an amendment to one of those recommendations which allowed the Leader to accept or decline the governments offer as soon as possible after the full council meeting of 11 October 2016 (Annex 2). A list of revised recommendations was tabled at the meeting as Annex 2.

15.  The Chairman stated that we should formally welcome the Cabinet request for Scrutiny Board’s support with testing financial assumptions.  

Recommendations:

a.    The Board recommends that the Leader should make the decision regarding acceptance or refusal of the governments four year settlement offer in public at a Leaders Decision making meeting so council members can make any representations as necessary.