Agenda item

Purpose of report:

 

Scrutiny of the 2022/23 Draft Budget report and Medium-Term financial strategy 2026/27.

Witnesses:

 

Matthew Furniss, Cabinet Member for Transport and Infrastructure

 

Anna D’Alessandro, Director, Corporate Finance and Commercial

Katie Stewart, Executive Director Environment, Transport and Infrastructure

Marie Snelling, Executive Director Customers and Communities

Tony Orzieri, Strategic Finance Business Partner

Nicola O’Connor, Strategic Finance Business Partner

Mark Hak-Sanders, Strategic Finance Business Partner

Rachel Wigley, Director Finance, Insights & Performance

 

Officers introduced a summary of the item and outlined the key aspects of the report, particularly focussing on the budgets for the Environment, Transport and Infrastructure Directorate (ETI), the Community Protection Group (CPG), the Prosperity Partnerships and Growth (PPG) Directorate and elements of the Customer and Communities Directorate (C&C) relating to this Select Committee.

 

Key points raised during the discussion:

 

1.    In response to a query about the impact of furlough, inflation and income pressures, an officer agreed that uncertainty brought risk to delivering the budget, especially the ongoing uncertainty around COVID-19. There was a £20m contingency built into the budget centrally that could meet any unforeseen pressures and there was a £58m total contingency. The officer added that the Council held reserves slightly over the 5-10% of its Net Revenue Budget reserve recommended by auditors and so were in a resilient position overall. The officer added that it was vital for directorates to keep within their budget envelopes in terms of inflation and National Insurance and the draft budget included provision to cover the National Insurance increases for employers. He added that the inclusion in the draft budget of 4% inflation was a reasonable starting point and that officers believed that this inflationary provision in the budget was sound.

 

2.    The Chairman asked if any details of the impact, positive or negative, regarding the financial settlement status to be announced by the Government on Surrey could be sent to members please. This was agreed.

 

3.    A member asked if taken together (Revenue and Capital), could residents be assured that this budget would not entail any deterioration of services across the board, for example, proposed changes to Community Recycling Policies etc.? Will they see improvements and if so, in what areas? An officer confirmed that the Council would not be delivering any kind of service reduction because of the changes in the budget that had been presented because of the efficiencies. They added that this was one of the guiding principles used to identify the efficiencies.

 

4.    A member pressed further if the Cabinet Member for Transport and Infrastructure could provide a commitment that all savings and efficiencies identified under the Committee’s relevant remit would not lead to any deterioration in its relevant services?

The Cabinet Member for Transport and Infrastructure confirmed that there were no plans to reduce services. A Select Committee Member enquired if improvements would be visible to residents? The Cabinet Member for Transport and Infrastructure confirmed that residents would be able to see improvements. He said that the Highways restructure had been completed resulting in Highways no longer being at the top of reasons for complaint.

 

5.    A Member asked if the budget would be on track at the end of the next financial year to deliver the reduction of 1.2 million tonnes of carbon dioxide as set out in the Greener Futures Delivery Plan.  An Officer said that although it was too early to confirm, the projections had now been completed so it would be possible to track progress.  Further, the model allows for a shift in direction so there were options to add or move actions around as needed to dynamically respond to the need to accelerate progress towards carbon reduction targets if needed. They added that if changes were required, it was critical to make them in the early stages of delivering the Plan, and much focus and effort concentrated on getting the carbon modelling that would be used to track progress against the Council’s and county’s targets up and running. They added that due to the data being received year to year, it was sometimes difficult to see progress which provided some complexity.

 

6.    A Member asked if it was realistic to expect that the 32,000 homes that had been identified as requiring emissions improvement for fuel poor and vulnerable homes would be addressed by the 2025 target as only 500 homes had been addressed to date?  An officer confirmed that 547 homes had been delivered so far and work was being done to accelerate this. Focus was currently centred around how this was financed and the model going forward and this was being considered by the Greener Futures Reference Group.

 

7.    A Member asked if there was a realistic chance of reaching the reduction of emissions from transport by 16% to 30% by 2025?.  The Cabinet Member for Transport and Infrastructure said that options were being providing to allow residents to make their own choices to switch to lower carbon. All the county’s contractors were meeting our commitments to be net zero by 2030. He said that investment was being put into prioritising buses, cycling and walking. It was not in the Council’s total control but the aim was to encourage residents to switch to lower carbon.

 

8.    A member asked if the budget was adequate both in terms of next year's budget and looking to the medium-term financial plan to deliver the Greener Futures initiative and climate change delivery plan.

An officer said that the budget would be able to leverage the investment and that capacity had been created within the Council to bid for money as our own budget would not be sufficient for the Greener Futures initiatives and the Climate Change Delivery Plan. Relationships had been built with energy savings scheme providers and the Council had become successful in terms of leveraging some funding.  They said that at this stage, based on current knowledge and our understanding of the policy environment and where government would look to invest, there was confidence that the Council had the capacity to secure the required investment into the County.

 

9.    A Member asked if more could be done to prioritise the increase in Planning Enforcement Team’s capacity and if it was achievable in this year’s budget?

An Officer said that the budget pressure identified was the result of employing additional enforcement officers. The increase of enforcement officers from two to three would allow us to be more proactive and so it was currently under review.

The Cabinet Member for Transport and Infrastructure agreed that it was a priority to be proactive with a scope to recover cost.

 

10.  A Member asked how many Electric Vehicle (EV) charging points were planned and would they be located on public highways?

An officer said that numbers were still being finalised although the current estimate was that 10,000 charging points would be required. A report was due in the new year regarding this subject but to date, trial activity around EV infrastructure was focused on street parking to address the gap of residents that had off street charging facilities and those that didn’t which was particularly important in the run up to the 2030 ban on petrol and diesel vehicles.

 

11.  A member asked if the reduction of on street parking spaces for the installation of EV charging points was being considered?

An officer said that residents were being consulted although it was inevitable that there would be some push back, however the hope was that as more residents make the switch to Electric Vehicles the more accepting the community would be.

 

12.  A Member asked how much money the Council had been awarded from the national £5bn pothole fund and if there was a guarantee that investment through the Horizon Programme would continue?

An Officer said that it was currently unknown what proportion would be awarded and that the budget had been based on the previous amount. Officers would keep the Committee informed regarding this

 

13.  A Member asked why the budget for the School Road Safety Scheme and the LED streetlight conversions ended after year 3?  and year 1 respectively?

An Officer explained that the LED conversion programme had run for a number of years and would be completed in 2022/23. Commitment to the School Road Safety Scheme would continue and be reviewed every year.

 

14.  A Member asked if the same applied to additional local transport schemes?

An Officer said that there was a commitment to addressing the backlog and it would continue to be under review.

 

15.  A Member asked why there was no line in the budget for communication and engagement.  Where in the budget was the additional resource for this?

An Officer explained that additional resources to support delivery of Greener Futures had been included in the budget, including staff resource in addition to a significant transformation budget of £1.3m which was currently being bid for. Officers said that they were also linking districts to better combined resources in addition to existing programs which were delivering Greener Futures messages.  Officers thanked the Committee for their direction and input on the communications and engagement front and that the Director of Communications would be working with the service to achieve some dedicated capacity around the effort.

 

16.  A Member enquired the recycling facility that had been budgeted at £21m.  An Officer said the facility was included in the capital pipeline because it was subject to a further business case. They added that it was currently being developed and further approval would be required to move the scheme into the budget and proceed.

 

17.  A Member asked what positive step changes the Council could be involved with to support the Climate Change Delivery Plan, especially considering the significant issues of no new petrol or diesel cars being manufactured and the ceasing of gas boiler installations after 2030. They also asked if the budget allowed to support these changes?

An Officer said that the work around EV infrastructure was ongoing and that a gap had been identified in terms of residents that do not have off street parking. They said that a model was being created to effectively channel our own funding in addition to leveraging some further investment as discussed earlier. This model would allow us to scale up and it would be a priority on the domestic and commercial front.

An Officer added that the domestic sector was in the top ten priorities and that work was being undertaken and funding was in place to support residents in the move away from gas boilers and make homes more efficient.

 

18.  A Member asked what was the likelihood of something moving from the pipeline into the programme?

An Officer advised that these items were subject to a business case and in the ‘pipeline’ as there was  confidence that they would move on to the ‘programme’, it was pointed out that the figures for these were subject to change.

 

19.  The Chairman asked if having a carbon budget running parallel with the financial budget was possible in the future?

An Officer explained that any decisions taken were made across the board and with the carbon impact in mind. They said that there was already a section for carbon impact on the cabinet report template and the aim was to become more sophisticated in how the information was captured and reported. A Member said that although the summary of the figures was important it would be beneficial to include the specific carbon impact on the budget too for the future.

 

The Chairman thanked all officers for their presentations and responses.

 

Resolved:

 

The Community, Environment and Highways (CEH) Select Committee:

 

i.          Broadly supports the budget proposals for those areas that fall within its jurisdiction, noting the commitment that all the savings/efficiencies identified will not lead to any deterioration – indeed these efficiencies aspire to improve – in the services provided to residents.

 

.          

ii.          Will continue to closely monitor performance throughout the year to be assured that assumptions made in and expectations derived from the budget will be met in practice.

 

 

Request for information:

 

a)         A briefing note specific to this Select Committee’s remit following the finance settlement, to be circulated to the Select Committee as soon as possible.

b)         A service response note about a review of budget efficiency in highways (i.e. resurfacing machine).

 

Recommendations:

 

1.         Community, Environment and Highways Select Committee seeks assurances from the Cabinet that the final 2022/23 budget has adequate resources allocated to support the high priority action plans and intended outcomes in relation to:

 

a)         Climate Change and Greener Futures Delivery Plans;

 

b)         A shift to Local Transport Plan 4 and active travel; and

 

c)         Recommendations of the Greener Futures Reference Group previously presented to Cabinet.

 

 

2.         Cabinet Member to provide evidence in the final budget to assure the committee that the additional capacity planned for the Planning Enforcement Team is adequate and realises additional revenue in terms of recovered costs.

 

3.         Asks Cabinet to seriously consider a parallel carbon budget (carbon impact of the total budget) in 2023/24 to be set alongside the financial budget so the carbon emission implications of decisions as well as the financial implications can be scrutinised