Agenda item

Joint report of the Director of Resources and Cabinet Member Finance and Community Development

The Cabinet Member for Finance and Community Development introduced the joint report and made the following points:

• The predicted overspend of £801,700 in the budget monitoring report to the end of August 2010 had been converted to an underspend of £174,086 in 2010/11 which was an outstanding achievement by officers across the council.
• £303,200 required Member approval at Council to carry forward requests.
• The proposed solution for the Bath Road toilets was an innovative approach involving local people in the service and satisfying their needs at a reduced cost to the council.
• Indications were that there would be a favourable verdict to the Icelandic Bank situation but this had not been assumed.
• The LAA performance reward grant was enabling a further round of Community Pride awards to the value of £30,000.
• An innovative use of the New Homes Bonus was being proposed to fund small environmental works and a fund to support events in the town. Both of these initiatives would help to attract visitors and trade to the town during the difficult economic climate.
• He supported the recommendations of the Section 151 Officer and considered it was prudent to increase the bad debt provision in view of the changes to the benefit regime.
• Additional proposals for bringing forward the roof repairs at the Everyman Theatre and funding the much-needed toilet refurbishment at the Town Hall were included.
• There had been a drop in income from offstreet parking. He considered that this was due to the current economic climate, the increased usage of buses by those eligible for concessionary fares and the public opting for more greener ways of travel.
• The take up of the garden waste scheme had been slower than anticipated in this financial year and if this trend continued there would be a shortfall of income of £223,200 in 2011/12.  He acknowledged that some members of the public were angry at having to pay a charge for a garden waste service which had previously been free. Despite the result in the take-up for the new garden waste scheme he still considered that the previous scheme had been unsustainable and it would not have been possible to continue subsidising it to the tune of £1 million per annum.  A marketing campaign would now be put in place to encourage people to take up the service.  

The Cabinet Member Finance and Community Development concluded that careful monitoring of the budget situation throughout the year had provided early warnings of problem areas which could then be addressed.  This would continue to be a rolling programme in the current budget climate. 

Councillor Garnham welcomed the use of the New Homes Bonus for environmental improvements but questioned the benefits of spending £180,000 on promoting the town in order to attract visitors and trade. The Cabinet Member had acknowledged in his introduction that footfall in the town was up and therefore there was no point in spending more money on improving it still further. He emphasised that the government was providing the New Homes Bonus to mitigate the strain that new developments made on the infrastructure of the town. Therefore the money should be spent on the residents of Cheltenham on such things as improving pavements, flower displays, additional street cleaning and increased litter bins not on promotion and cultural activity.

He proposed an amendment that recommendation 5 should be replaced with the following:

“ to establish a cross-party working group to address the spending of the New Homes Bonus, as outlined in paragraph 6.4 on page 6 of the report, on items or programmes of work that will truly mitigate the strain that the increased population brings and report back to Cabinet”.

This was seconded by Councillor McLain.

Speaking for the amendment, Councillor Smith agreed that the purpose of the bonus was for expenditure on infrastructure and to improve the quality of life for people in the town. It was a significant amount of money and therefore it was appropriate that it should be given appropriate consideration and consensus achieved by a cross-party group. As Leader of the previous administration he had been keen to spend funding from the Local Authority Business Growth Incentive Scheme to support local businesses but the emphasis had been on building a long-lasting legacy rather than funding for one-off events. The Joint Core Strategy was one area which could benefit from additional funding.

Councillor Hibbert reminded members that a significant amount of money had been redirected from PittvillePark during the last budget. The Friends of Pittville Park had been very active in exploring options for funding for improvement work and she asked the Cabinet Member whether he would be willing to meet with them to discuss future funding. She suggested that some of the New Homes Bonus could be used for this purpose.

The Cabinet Member Sustainability confirmed that he would be happy for such a meeting to take place.

Speaking against the amendment, the Leader said he would resist the change as the proposed spend was not for  marketing as had been suggested.  Another member suggested that the cross-party budget working group was the appropriate forum for this matter to be raised. It was also emphasised that retail businesses were currently struggling and promoting Cheltenham would help boost the economy which in turn would have a beneficial effect on the well-being of people in the town.

In seconding the amendment, Councillor McLain acknowledged the views of both sides but considered that a meeting of a cross-party group over the next four to six weeks would be the best option.

Upon a vote the amendment was LOST

Voting For 14, against 21 with 0 abstentions.

Debate continued on the main motion.

On the subject of green waste, some members felt clarity was needed on the way the current position and predicted outcome was presented in the report. The green waste scheme had been well publicised including extensive articles in the Echo and therefore there was no benefit to be gained in spending further money on marketing the scheme. They challenged the statement of the Cabinet Member Finance that the service had been “free’ as it had always been effectively paid for by council tax payers as part of the budget. The charge may be may modest but it still presented difficulties for those on pensions and limited incomes. The recent queues at local recycling sites were an indication that people were not prepared to take up the service. The council should give consideration to the additional costs of dealing with the extra green waste deposited in this way. The green waste bins provided were also not suitable for many terraced properties or those in multiple occupancies and despite prompts this issue had not been resolved. Members wanted to know how much had already been spent on marketing the green waste scheme.

The Cabinet Member Sustainability said he did not have any figures on the current marketing spend but it was not a great amount of money. He would circulate a written response to members.

In support of the current position,  the Leader acknowledged that the roll-out of the kitchen waste scheme had been a priority for officers and Cabinet were now asking them to refocus on the green waste scheme to ensure that it met its 2012 targets. There was no proposal to spend thousands of pounds on marketing as some Members had suggested. The Cabinet Member Finance reminded members that the budget was about choices and they could either make a charge for green waste or make cuts elsewhere. He added that other authorities around Cheltenham had introduced such a charge.

Members asked a number of questions and and the responses of the Cabinet Member are listed below:

• Should the loss of income on car parks be featured on the Corporate Risk Register? What is the target for fine income referred to in paragraph 15.5 and in the incentives being given to staff to achieve this target?
  • The Cabinet Member Finance agreed to provide a written response on the target.
• Will support for the Bath Road Toilets be in the base budget for the next two to three years?
  • The Cabinet Member confirmed that this had been factored into the base budget, £5000 for services and £10,000 to the Bath Road traders for the maintenance.
• Why was a similar approach not being adopted for the Cox’s Meadow toilets which were now closed. They had been well used by local people and travellers and the nearest public toilets were a mile and a half away at Royal Well?
  • There were no plans to adopt the approach used for the Bath Road toilets but they would continue to look for alternative provision of the facilities. The usage pattern had changed and it was with reluctance that the facilities had been closed.
• Would it not be more prudent to transfer some of the underspends from 2010/11 to the general reserve to offset any future reductions in income from car parking fees etc
• What was the rationale for forming a Local Authority Company with one authority when the county strategy was for a joint waste partnership?
  • The Leader responded that the setting up of the company was a crucial step towards achieving the vision of the joint waste partnership with shared waste services across the county.
• Would spending on youth work include the subsidy required by the county for the safeguarding board which provided a critical role? How would further spending on youth work be allocated?
  • The Cabinet Member Housing and Safety indicated that she would be happy to meet with Councillor McLain, as the county member responsible for this area, to discuss the safeguarding board.
    The allocation of youth funding was work in progress in consultation with the Social and Community O&S Committee. 
• A simplified explanation of the current Icelandic Bank situation was requested.
  • The Section 151 officer said that if the current situation progressed as anticipated, the council would lose £546,000 of the £11 million it had originally invested and would recover the remaining amount. He would ensure that the net loss would be reported to members in any subsequent reports and briefings  

The Leader acknowledged the outstanding effort from officers in achieving this budget outturn position but also stressed that this had not been without some pain.

Councillor McClain proposed that the recommendations were taken on block omitting recommendation 5 where a separate vote was requested.
 

Resolved that the following recommendations be approved:
Voting on all recommendations excluding 5:

For 32, Against 0 with 2 abstentions

1. Receive the financial outturn performance position for the General Fund, summarised at Appendix 2, and note that services have been delivered within the revised budget for 2010/11 resulting in a budget underspend of £174,086 which has been transferred to General Balances pending decisions over its use in 2011/12. 
   
   
2. Recommend the following use of the underspend:

·        £48,000 to fund carry forward requests requiring Member approval at Appendix 7 which includes £15,000 to fund the arrangements for keeping the Bath Road toilets open (see paragraph 3.4)

·        note the Cabinet’s approval, under financial rules 4G, part 8.11, to use the net underspend on new green waste schemes to fund the full rollout of plastic bottles collection across the borough in 2011/12 (estimated cost £17,000) (see paragraph 3.5)

·        £124,300 to fund the one off costs of the establishment of a waste company with Cotswold District Council as set out in the exempt report to Cabinet on 21^st June 2011.

·        transfer the balance of £1,786 to General Balances

3. Note the treasury management outturn at Appendix 9.
4. Approve the allocation of the LAA performance award grant as set out in section 5.
5. Approve the allocation of the New Homes Bonus as set out in section 6 including the use of £30,000 from the civic pride reserve.
   (Voting: For 20, Against 13 with 1 abstention)
6. Approve the transfer of £50k from the benefits equalisation reserve to the benefits bad debt provision as per paragraph 7.3.
7. Note the capital programme outturn position as detailed in Appendix 11 and approve the carry forward of unspent budgets into 2011/12 (section 8).
8. Note the position in respect of section 106 agreements and partnership funding agreements at Appendix 12 (section 10).
9. Note the outturn position in respect of collection rates for council tax and non domestic rates for 2010/11 in Appendix 13 (section 11).
10. Note the outturn position in respect of collection rates for sundry debts for 2010/11 in Appendix 14 (section 12).
11. Receive the financial outturn performance position for the Housing Revenue Account for 2010/11 in Appendices 15 to 17 (section 13).
12. Note the outturn prudential indicators Appendix 18 and recommend that Council approve the revised prudential indicators for 2010/11, marked with an asterisk (section 14).
13. Note the budget monitoring position to the end of May 2011 (section 15).
14. Approve the advance of property grant to support the refurbishment of the Everyman theatre roof and the funding schedule for the next 6 years as at section 9 and Appendix 19.
15. Approve the one-off contribution of £170k from the Property Repairs & Renewals reserve to the programme maintenance budget to fund maintenance works at the Art Gallery & Museum in 2011/12 (section 15).
16. Approvethe one-off contribution of £30k from the Property Repairs & Renewals reserve to the programme maintenance budget to fund toilet refurbishment works at the Town Hall in 2011/12 (section 15).

The meeting adjourned for tea from 5.10 to 5.25 pm