Agenda item

Report of the Cabinet Member Finance & Community Development and the Director of Resources

The following is the recommended process to be followed for the debate relating to the Council’s Budget for 2012 – 2013, (Agenda item 11). The rules of procedure shall be varied accordingly for this item only.

1.         The Mayor to propose suspension of the following rules of debate:

-           That the time limit on speeches is relaxed with regard to the following speeches:-

§         Cabinet Member Finance and Community Development, (F), when moving the motion to adopt the budget being proposed by the Cabinet (“the Cabinet’s budget”), Stage 2(i).

§         Group Leaders when making Budget Statement on behalf of group, Stage 3(i) – (ii).

-           To permit the Cabinet Member F and Group leaders to speak more than once in the debate, (in addition to any right of reply etc), for the purpose of putting and answering questions at Stage 2(iii).

2.         Budget Statement and moving of motion

(i)         The Cabinet Member F shall deliver the budget statement and formally move the resolutions set out in paragraph 1.2 of the report of the Cabinet Member Finance. (N.B. Not time limited)

(ii)        The seconder shall formally second the motion. (N.B. The seconder may reserve their speech until later in the debate prior to the closing speeches) 5 minute limit applies.

(iii)       Members may then ask questions of the Cabinet Member F (who may refer them to the Chief Finance Officer when appropriate), on matters relating to agenda item 13. (N.B. members are limited to one question only, without supplementary, and the Cabinet Member F shall wait until all questions have been put before responding).

3.         Statements by Group Leaders

(i)         Statement on behalf of the Conservative Group including tabling but not moving, any proposed amendment to the Cabinet’s budget. (no time limit)

(ii)        Statement on behalf of the People Against Bureaucracy Group including tabling, but not moving, any proposed amendment to the Cabinet’s budget. (No time limit).

4.         Formal moving, Seconding, debating, discussion and voting on any amendments tabled in the following order:

            - People Against Bureaucracy Group

            - Conservative Group

N.B. 

§         The Cabinet Member F has the right to a speech in reply at the end of the debate on any amendment. (10 mins).

§         The mover of an amendment may speak to move the amendment, (10 mins), and also has the right of reply to the debate immediately before the speech of the Cabinet Member F. (10 mins).

§         Amendments carried will become part of the substantive motion going forward. Once all proposed amendments have been debated and put to the vote the final version of the motion shall go forward to the next stage.

5.         Consideration of Amendments

(a)       If the Cabinet’s budget has not been amended, the Cabinet Member Finance and Community Development to formally propose the budget (no speech), and the final proposal will be debated and voted upon subject to the Cabinet Member F's right of reply (10 mins).

(b)       If the Cabinet’s budget has been amended, before it is further debated and voted upon, the Mayor shall propose a brief adjournment in order that the Cabinet Member F can consider whether:

(i) the amendments are acceptable to the Cabinet - in which case the meeting will proceed as at (a) above; or

(ii) the amendments are not acceptable to the Cabinet - in which case, the meeting will proceed as at (a) above save that, in accordance with the Budget and Policy Framework Rules, the Council may only make an in-principle decision which will be published and provided to the Leader of the Council for consideration.

The Mayor invited the Section 151 Officer to give a presentation to Council on the budget.

In response to questions from members, the Section 151 Officer gave the following responses;

• Regarding the freeze of council tax, the government grant would be equivalent to a 2.5% increase in council tax.
• Asked whether the council's levels of reserves were consistent with other councils comparable with Cheltenham, he advised that in setting reserves the council took a similar view to the advice from CIPFA that the reserves should be set at around 3% of the gross budget.
• He informed members that the savings from shared services amounted to an excess of £2 million over five years broken down as follows:
  One Legal - £80 K per annum p.a.
  Building Control - £30 K p.a.
  Audit Partnerhsip - £30 K p.a.
  GO - £270 K p.a. from 2013/14
• Regarding the timing of payments from Glitnir, Icelandic Bank he advised that discussions were currently underway with the winding up board and they were expecting a payment by the end of this financial year. However even if this payment was delayed, it was a matter of timing but the payment itself was not in question.

The Mayor, to facilitate the presentation of the Budget, proposed suspension of certain rules of debate, namely:-

That the time limit on speeches is relaxed with regard to the following speeches

• Cabinet Member Finance and Community Development when moving the motion to adopt the budget being proposed by the Cabinet.

• Group leaders or Group spokesperson when making budget statements on behalf of their group.

The Cabinet Member Finance and Community Development and Group Leaders could also speak more than once in the debate (in addition to any rights of reply etc) for the purpose of putting and answering questions. 

This was agreed by Council.

The Cabinet Member Finance and Community Development introduced the 2012/13 budget proposals with a detailed speech (please see attached).  

The Cabinet Member Finance moved acceptance of the 2012/13 Budget as set out in the report.  The motion was seconded by Councillor Rawson who reserved his right to speak.

In response to questions from members, the Cabinet Member Finance gave the following responses:

• A member raised concerns about the extension of car parking charges to 8 p.m. in the evening and wanted to know whether this was cost effective. Another member had concerns about the number of shops closing in the town and whether this was linked with car parking charges. The Cabinet Member advised that this was currently being reviewed and a report would be produced. He had been advised by the Town Centre Manager that footfall in the town was fairly consistent with previous years and therefore he was not convinced that higher car parking charges was the reason behind shops closing down in the town centre.  In his view the concessionary travel scheme was a more likely cause of the fall in car parking income. The county council had extended their on street car parking to 8 p.m. It was important that there was harmonisation between the county council’s charges for on street parking and the charges the council made for its own car parks.
• Regarding green waste, the Cabinet planned to set up a cross party member working group to look at the way forward.
• He advised that the council had incredibly high collection rates for council tax and assumptions in the budget had been based on that level of return.
• A member asked what criteria would be used to ensure value for money from the funding allocated from the New Home Bonus (NHB) and what follow-up process will be put in place to demonstrate that the funding allocated had resulted in attracting inward movement into the town. The Cabinet Member advised that the criteria for allocating any funds from the NHB would be set and bids would be assessed by the group which had been set up for this purpose consisting of both members and outside people.
• He welcomed the appreciation expressed by a member in continuing to give financial support to youth provision in Cheltenham from the NHB.
• Regarding the suggestion that the council should encourage small businesses by reducing business rates, he reminded members that business rates were currently set by government. Under the proposed new scheme, the council may have more discretion to support new businesses but it was likely that any reduction in business rates would have to be funded locally.
• Regarding the suggestion that the council should be doing more to support Cheltenham Festivals who were experiencing financial difficulties, he advised that Cheltenham Festivals had bid for a grant from the Promoting Cheltenham Fund this year and he assumed they would apply again next year. He confirmed that the council had stopped the grant to the festivals last year however the council continued to provide contributions in kind such as ICT support. He confirmed that the next tranche of the fund was due to be distributed in March this year, however the Leader qualified that there was only a small amount of funding left so they would manage the response accordingly.

Councillor Garnham gave a response to the budget on behalf of the Conservative party.  He paid tribute to Councillor Webster and the former Cabinet Member for Finance for taking control of the council's overspends and the achievements of the Bridging the Gap programme. He acknowledged that there had been little room to manoeuvre in bringing together a balanced budget and consequently his party were proposing no amendments.

However they did have a number of concerns which he highlighted.

• In proposing a council tax freeze, the budget accepted that there would be a £200,000 gap in the base budget in future years.
• There was concern about building a significant part of the New Homes Bonus  (NHB) into the base budget
• Concern about the decision not to contribute £200,000 to the property maintenance budget in 2012/13.
• The real area of concern was that there were still huge areas of uncertainty in the budget and a massive gap of £2 million at the end of year five in the Medium Term Financial Strategy. There was an expectation that commissioning would deliver further savings but there were no specific targets. Until plans were in place to demonstrate how this gap would be closed, this would continue to be a concern for people.

Councillor Godwin gave a response to the budget on behalf of the People Against Bureaucracy party.  He gave thanks to Councillor Webster for meeting with members of his party to explain the budget and answer any questions they had.  He acknowledged that it had not been an easy budget given the current financial restraints set by government and it was down to the hard work of everyone involved in achieving a balanced budget.  He highlighted the sting in the tail relating to the grant from Government to support the freeze in council tax which the Council would lose next year.  He supported the budget and was confident that the Finance Team would be up to meeting the challenges in future years.

Councillor Jordan added his comments to the budget as Leader of the Liberal Democrat party. He paid tribute to Councillor Webster and Mark Sheldon and all his Finance team together with everyone involved in the success of the Bridging the Gap programme and the newly formed Budget Working Group. Whilst acknowledging the Conservative’s concerns about the future, he highlighted that both the Local Authority Company and GO were due to go live in April and there was lots more to come.  The Council would continue to achieve efficiency savings by working together with others and thereby avoid the need to cut services. The Council should continue to invest in initiatives which supported Cheltenham as a visitor destination and the use of the NHB was part of the process. As the NHB was guaranteed for the next six years he considered it was entirely right that part of it was built into the base budget and sensible to use the remainder for supporting youth services and the Promoting Cheltenham fund.  He was aware that there was disagreement with the NHB strategy and Cabinet would be reviewing its success in due course.  It was important that the council continued to support small businesses and start-ups by providing advice and guidance and was currently working with partners in Gloucestershire to determine the best way to do this. There would be difficult times ahead and he would be urging government to give local authorities as much advance warning as possible of future settlements. He urged members to support the budget which provided great investment in the town and no major cuts in services.

The Cabinet Member Built Environment responded to the concern regarding the lack of top of the property maintenance fund in 2012/13. He highlighted that the planned expenditure on property maintenance was in excess of £1.6 million next year which compared favourably with previous years.  The plan included some important projects for the town such as improvements to the Grosvenor Terrace car park and Town Hall facilities. He sympathised with the concern about charging for evening parking and the Cabinet were considering a number of pilots which would promote the town centre as an evening destination. He also highlighted that the County Council were significantly increasing the charges for on street parking for residents and businesses which would also have an impact.

The Cabinet Member Sustainability raised a point of clarification regarding the highways maintenance contract. Although the County Council were not proposing any reductions to grass verge cutting, there were significant cuts planned with regard to weed killing and foliage reduction in alleyways and removal of epicormic growth from trees which would have a significant impact in the town.

Upon a vote it was

RESOLVED that having considered the budget assessment by the Section 151 Officer at Appendix 10;

1. The revised budget for 2011/12 be noted.

2. The final budget proposals including a proposed council tax for the services provided by Cheltenham Borough Council of £187.12 for the year 2012/13 (a 0% increase based on a Band D property) be approved.

3. The growth proposals, including one off initiatives at Appendix 3, be approved.

4. The savings / additional income at Appendix 4 be approved.

5. The reserve re-alignments at Appendix 5, as outlined in section 9 be approved.

6. The proposed capital programme at Appendix 6, as outlined in Section 10 be approved.

7. The updated Medium Term Financial Strategy at Appendix 7 including the impact of the ‘bridging the gap’ programme on the forecast budget gap be noted.

8. The proposed Property Maintenance programme at Appendix 8, as outlined in Section 11 be approved.

9. A level of supplementary estimate of £100,000 for 2011/12 as outlined in section 14 be approved.

(Voting: 25 For, 7 Against, 4 Abstentions)