Agenda item

To approve:

·         the draft revenue and capital budget for the five years 2014-19;

·         the level of the council tax precept for 2014/15; and

·         the treasury management strategy, including the borrowing and operation limits (prudential indicators), policy for the provision of the repayment of debt (minimum revenue provision (MRP)), and treasury management policy.

The Chairman said that the papers for this item were included in the agenda and the supplementary report of the Cabinet circulated last week. He asked Members to note that the recommendations before them today, numbered (1) to (15) were set out in the supplementary report.

 

He said that the debate on the Budget would be conducted in accordance with the County Council’s Standing Orders, with the exception that he would allow the minority group leaders five minutes each for speeches on the Budget proposals.

 

The Leader presented the report of the Cabinet on the Revenue and Capital Budget 2014/15 to 2018/19, the Council Tax Requirement for 2014/15 and the Treasury Management Strategy and made a statement in support of the proposed budget.  A copy of the Leader’s statement is attached as Appendix B.

 

The Chief Finance Officer presented her report to Council. A copy of her statement is attached as Appendix C.

                             

Each of the Minority Group Leaders (Mrs Watson, Mr Johnson and Mr Harrison) spoke on the budget proposals.

 

Key points made by Mrs Watson were:

 

·         Support for the level of council tax proposed but opposition to the budget as a whole

·         The budget needed to be radically reshaped and more needed to be done to raise funding from the European Union

·         Pleased the Administration was spending money to resurface roads and provide more school places but other areas needed additional funding

·         The majority of Surrey residents did not think that the County Council provided Value for Money

·         A request for a separate vote on recommendations (10) and (11)

 

Key points made by Mr Johnson were:

 

·         Disappointment that the Council Tax was being increased and that the budget report indicated that further increases would be inevitable

·         The aim of all Members was to obtain the best possible result for their electorate

·         There was no mention of cutting costs and he hoped that next year’s budget would address this (However, front line services should be excluded)

 

 

Mr Harrison moved an amendment, to the Budget recommendations, which was formally seconded by Mr Townsend. This was:

 

A new recommendation (15):

 

15. acknowledges the challenging and ambitious savings targets for the Friends, Family and Community Programme within the Adult Social Care Directorate and requires the Chief Executive, Strategic Directors and the Chief Finance Officer to develop  contingency plans to make savings in other budget areas to ensure the overall County Council budget envelope for 2014/15 is maintained.  

 

And amend the original recommendation 15, to become a new recommendation (16)

 

(additional words underlined  and deletions crossed through)

 

15 16. Requires these contingency plans to be assessed as part of the final detailed MTFP (2014/19) which the Council notes that the Cabinet will consider and approve the final detailed MTFP (2014-19) on 25 March 2014, following scrutiny by Select Committees.

 

So that the Budget recommendations now read:

 

The County Council:

 

(1) – (14) As per the supplementary report of the Cabinet   

 

(15)     acknowledges the challenging and ambitious savings targets for the Friends, Family and Community Programme within the Adult Social Care Directorate and requires the Chief Executive, Strategic Directors and the Chief Finance Officer to develop  contingency plans to make savings in other budget areas to ensure the overall County Council budget envelope for 2014/15 is maintained. 

 

(16)     requires these contingency plans to be assessed as part of the final detailed MTFP (2014/19) which the Council notes the Cabinet will consider and approve on 25 March 2014, following scrutiny by Select Committees.

 

In support of his amendment, Mr Harrison made the following points:

 

·         Concern re. the level of savings to be achieved within the Adult Social Care Budget, in particular, within the Friends, Family and Community Programme – he did not consider the savings targets to be realistic

·         Other demands for funding i.e. highways repairs following the flooding, Better Care Funding and School Places

·         Only the overall Budget figure was being agreed by Council at this meeting

·         The Chief Finance Officer had confirmed that there were significant risks associated with this Budget

·         Council tax would increase again in 2015 or there would be further cuts to services

·         Other areas of concern included: (i) that the overall headcount for the County council had increased over the last two years, (ii) Information Technology costs continued to rise, (iii)Central Infrastructure costs needed to be re-examined, and (iv) the level of senior officer salaries

 

Seven Members spoke on the amendment, making the following points:

 

·         That the amendment was a direct result of the Adult Social Care (ASC) discussion at the Council Overview and Scrutiny (COSC) meeting. However, following that meeting, discussions had taken place on how to deal with the pressures

·         Referring to recommendation (15), the onus was on select committees / COSC to ensure that the detailed budgets were financially viable before Cabinet approved the MTFP on 25 March 2014

·         Acknowledgement that the budget was tough and there would be challenges

·         Government lobbying had resulted in some success i.e. the funding for the New Homes Bonus was being returned to Councils

·         The number of extra responsibilities passed to County Councils since this Government had been in power

·         Concern re. the detail of the budget and that the ASC budget should be realistic. There was also no contingency plan in place – should the need arise.

·         Concern re. the reduction to the ASC care package budget

·         Lack of understanding as to how the County Council would ‘do things differently’

·         The overall budget needed to be approved at this meeting and subsequently the detailed budget proposals would be scrutinised

 

 

The amendment was put to the vote, with 21 Members voting for and 52 Members voting against it. There were no abstentions.

 

Therefore the amendment was lost.

 

Returning to the original motion, 9 Members spoke on it.

 

Key points made in the debate were:

 

·         The success of the apprenticeship scheme - it looks to the future and provides young people with opportunities

·         Confirmation that the County Council was working hard to try and obtain European Union funding

·         A reference to the Leaflet: ‘More than 50 ways Surrey County Council adds Value’, which was annexed to the Budget report

·         The Public Value Review programme resulted in savings in excess of £30m. Also, unit costs were being reduced

·         Support for Project Horizon.

·         A reduction in the Adult Social Care budget would result in fewer people being employed to help those in need

·         Any cuts should be shared across all budgets

·         Funding for road repairs / flooding issues continued to be inadequate

·         Residents would find it difficult to understand that their council tax was being increased

·         Cutting the Surrey Fire and Rescue budget in Spelthorne was indefensible at this time, when large areas of the county were flooded and their services were urgently required

·         An explanation as to why the County Council received a low Government grant and had to rely on raising a large part of its funding through council tax – could Surrey’s Conservative MPs be lobbied to address this issue

·         Due to forthcoming elections in 2015, Government promises about including council tax freeze grant in the base budget were worthless

·         Increasing the council tax uplift by 1.99% was at the right level for the County Council

 

 

After the debate, the Chairman said that he would not be agreeing to Mrs Watson’s request to take a separate vote on recommendations (10) and (11) and that he would be taking the Budget, including Treasury Management, as one recommendation.

 

52 Members voted for the Budget proposals and 21 Members voted against it. There were no abstentions.

 

Therefore, it was:

 

RESOLVED:

 

(1)     That the Chief Finance Officer’s statutory report on the robustness and sustainability of the budget and the adequacy of the proposed financial reserves (Annex 1 to the submitted report) be noted.

 

(2)     That the council tax requirement for 2014/15 be set at £564.0m (Annex 3, paragraph 3.5 in the submitted report).

 

(3)     That the 2014/15 council tax up-lift be fixed at 1.99%.

 

(4)     That the basic amount for 2014/15 council tax at Band D be set at £1,195.83 (Annex 3, paragraph 3.7 in the submitted report).

 

(5)     That the council tax for each category of dwelling in its area will be as follows:

 

Valuation band	£
A	797.22
B	930.09
C	1,062.96
D	1,195.83
E	1,461.57
F	1,727.31
G	1,993.05
H	2,391.66

 

(6)     That the payment for each billing authority, including any balances on the collection fund will be as follows:

Billing authority	£
Elmbridge	74,230,222.44
Epsom & Ewell	37,557,254.18
Guildford	64,630,646.62
Mole Valley	46,631,182.73
Reigate & Banstead	68,767,330.83
Runnymede	37,289,117.17
Spelthorne	45,013,925.65
Surrey Heath	44,379,315.63
Tandridge	43,429,951.44
Waverley	63,113,040.71
Woking	46,301,177.37
TOTAL	571,343,164.77

 

(7)     That the payment for each billing authority, including any balances on the collection fund to be made in ten equal instalments on the dates, already agreed with billing authorities as follows:

 

17 April 2014	17 October 2014
23 May 2014	21 November 2014
27 June 2014	5 January 2015
1 August 2014	12 February 2015
8 September 2014	16 March 2015

 

(8)     That the council tax rate set above be maintained and powers be delegated to the Leader and the Chief Finance Officer to finalise detailed budget proposals following receipt of the Final Local Government Financial Settlement.

 

(9)     That the £2.5m additional council tax surplus on the Collection Fund be transferred to the Economic Downturn Reserve (paragraph 68 of the submitted report).

 

(10)   That the County Council budget, of £1,646.7m, for 2014/15, be approved.

 

(11)   That the following capital programme proposals be agreed:

 

·                to fund essential schemes over the five year period (schools and non-schools) to the value of £760m including ring-fenced grants and

·                to make adequate provision in the revenue budget to fund the revenue costs of the capital programme.

 

(12)   That the Chief Executive and Chief Finance Officer be required to establish a mechanism to regularly track and monitor progress on the further development and implementation of robust plans for achieving the efficiencies across the whole Medium Term Financial Plan (MTFP) period.

 

(13)   That Strategic Directors and Senior Officers be required to maintain robust in year (i.e. 2014/15) budget monitoring procedures to enable Cabinet to monitor the achievement of efficiencies and service reductions through the monthly budget monitoring Cabinet reports, the quarterly Cabinet Member accountability meetings and the monthly scrutiny at the Council’s Overview & Scrutiny Committee.

 

(14)   That a robust business case be required to be prepared for all revenue invest to save proposals and capital schemes before committing expenditure.

 

(15)   That the final detailed MTFP (2014-19) be considered and approved by Cabinet on 25 March 2014, following scrutiny by Select Committees.

 

Treasury management and borrowing:

 

That the Treasury Management Strategy for 2014/15 be approved and that the provisions have immediate effect (Annex 2 to the submitted report).

 

This strategy includes:

·                the investment strategy for short term cash balances

·                the treasury management policy (Annex 2, Appendix B1 to the submitted report)

·                the prudential indicators (Annex 2, Appendix B2 to the submitted report)

·                the scheme of delegation (Annex 2, Appendix B4 to the submitted report)

·                the minimum revenue provision policy (Annex 2, Appendix B7 to the submitted report).