Web Agenda/Minutes Summary Document

Meeting Name:
Adult, Community Services and Health Overview and Scrutiny Panel

Meeting Date:
11/09/2009 Pick

Meeting Time:


Location:


Sub Committee / User Forum etc (if required):




Members Present:

Non-Members Present:

Confidentiality: Part I


Document Type: Agenda


Document Status: Final

COUNCILLOR MEADOWCROFT (CHAIRMAN)
COUNCILLOR MRS ENDACOTT (VICE-CHAIRMAN)
COUNCILLORS BASKERVILLE, MRS EVANS, LENTON, MAJEED, MRS NAPIER, MRS PROCTOR & MRS YONG

SUBSTITUTE MEMBERS
COUNCILLORS HERDSON, MRS HOWES, MRS KEMP, MRS LUXTON, PENFOLD & D. WILSON

ITEM	SUBJECT	WARD	PAGE NO
1	APOLOGIES FOR ABSENCE To receive any apologies for absence
2	DECLARATIONS OF INTEREST To receive Declarations of Interests from Members of the Panel in respect of any item to be considered at the meeting.		-
3	MINUTES To confirm the Part I Minutes of the meeting of the Panel held on 7 September and 13 October 2009.	All
4	HEATHERWOOD AND WEXHAM PARK HOSPITALS NHS FOUNDATION TRUST - UPDATE ON FINANCIAL SITUATION To receive and update on the Trust's current financial situation.	All
5	MINOR INJURIES UNIT - ST MARK'S HOSPITAL To comment on the PCT's review of the Minor Injuries Unit at St Mark's Hospital, Maidenhead	All
6	CAR PARK CHARGES AT ST MARK'S AND KING EDWARD VII HOSPITALS To receive an update on the impact of the introduction of the car park charges at St Mark's and King Edward VII Hospitals.	Various
7	ROYAL BOROUGH OF WINDSOR AND MAIDENHEAD JOINT STRATEGIC NEEDS ASSESSMENT REPORT To receive a presentation in relation to the Joint Strategic Needs Assessment.	All
8	CALL IN OF CABINET DECISION - 22 OCTOBER 2009: THE PRELIMINARY BUDGET REPORT To consider the call in of the decision.	All
9	SERVICE INSPECTION OF ADULT SOCIAL CARE To consider the report that was submitted to Cabinet on 24 September 2009 on the outcome of the Care Quality Commission's inspections of Adult Social Care services.	All
10	SERVICE MONITORING REPORT To consider activity within the Adult, Community Services and Health services during the period to 30 September 2009.	All
11	WORK PROGRAMME The following items are scheduled for discussion at the meeting of the Panel to be held on 14 December 2009. Adult Social Services Annual Performance Assessment Report By CSCI Outcome of Consultation on Contributions Policy for Adult Social Care Work Programme	All	-
12	LOCAL GOVERNMENT ACT 1972 – EXCLUSION OF THE PUBLIC To consider passing the following resolution:- “That under Section 100(A)(4) of the Local Government Act 1972, the public be excluded from the remainder of the meeting whilst discussion takes place on items 13 and 14 on the grounds that they involve the likely disclosure of exempt information as defined in Paragraph 3 of part I of Schedule 12A of the Act"	-	-

 Meetings 091109 Acshosp Miu Report

King Edward VII Hospital - £20,000
St Marks Hospital - £ 7,000

King Edward VII Hospital - £12,000
St Marks Hospital - £ 6,000

On-going capital charges relating to the maintenance repairs
Access control barriers to staff parking areas
ID access control internally
Further security measures
Further maintenance and repairs

 Meetings 091109 Acshosp Jsna Presentation 2009

CALL IN OF CABINET DECISION – 22 OCTOBER 2009: THE PRELIMINARY BUDGET REPORT

In accordance with Part 4 E16 of the Constitution, the 22 October 2009 Cabinet decision relating to the Preliminary Budget has been called in for review by this Panel.




Reason for Call-in

The preliminary budget report assumes large potential savings arising from reorganisation of Directorates. Neither at Overview and Scrutiny nor at Cabinet was the detail of how that was to be achieved, fully explored. Following subsequent discussions with staff, it is believed that a more open examination of these changes can take place. It is important that alterations of the significance envisaged should be properly scrutinised by the Panel tasked with doing so.

Options

Having considered the Call-in, Members may:-

if satisfied with the decision, resolve

a) to take no further action,

if still concerned about the decision, resolve

b) to refer the decision back to Cabinet for reconsideration, setting out the nature of the Panel’s concerns; or

c) to refer the matter to Council for consideration.

A copy of the Cabinet decision is attached at Appendix 1 and a copy of the Cabinet report is attached at Appendix 2.

Cabinet considered the Preliminary Budget Report, which set the context for discussions that had been held over the past weeks as part of the process for setting the Budget for 2010/11.

Cabinet was addressed by Mr Hooper in relation to the item. Mr Hooper stated that cutting of services and selling of assets had been done in previous years, for example the sale of the King Edward Curt car park which had led to a significant loss of revenue for the Council. He believed that the Windsor Parking Strategy had been a total disaster. He had recently looked at local car parks and found that the Legoland park and ride car park on average had 7 cars in it during the week and 14 at weekends. The Dials car park regularly had 2 and a half floors empty and was loss making. He had no confidence that the racecourse park and ride would provide a revenue stream and he urged the Council to consider again a park and ride scheme on the Northfield site by the Relief Road. He suggested that the land should be compulsory purchased by the Council from Eton College at the existing use value of £5000-7000 per acre. The Council could set up a park and ride scheme and receive revenues from tourists and commuters and sell any excess land.

The Lead Member for Finance thanked Mr Hooper for his comments; although they did not directly relate to the budget, he was confident his colleagues would take them into consideration. Members noted that 2010/11 would mark the end of the Government’s first three-year grant funding settlement. This gave a degree of certainty year on year but also showed a significant real-term reduction in financial support. Speculation was growing about public sector spending; it now seemed inevitable that the Council would receive a significant reduction in the level of financial support from the Government in the period 2011/12 and beyond. Whilst it was very difficult to predict the level of these reductions it was important that the Council started to plan for such an eventuality. In the light of the significant pressures the Council would face, the report sought approval for the cost reductions that had been discussed at the Budget Steering Group with Strategic Directors. The Lead Member highlighted a number of pressures the Council faced, including the recession, a reduction in interest rates, waste disposal costs, safeguarding in children’s services and an increase in demand for benefits. Reserves were in a healthy state, which would enable the Council to handle economic problems. Inflation had dropped to –1.4%.

The Director of Adult and Community Services provided Members with a summary of the comments from the Adult, Community Services and Health Overview and Scrutiny Panel. She explained that Members of the Panel had expressed concern at the lack of detail in relation to some line items. It had been explained to the Panel that a number of the items related to sensitive staffing issues and the Panel had decided to move into Part II to allow for further debate.

The Director for the Environment commented that the King Edward Court car park was privately run as part of the shopping centre. The Council had not therefore disposed of this car park as suggested but had invested in improvements in the shopping centre which gave a guaranteed financial return. The Council had also received a full report on projected growth in the demand for parking in Windsor, which had led to the strategy endorsed by Cabinet earlier in the year. The Dials car park was not used as effectively as the Council would like therefore additional marketing had taken place and an improved link to the town centre was under consideration which would hopefully address the issue.

The Lead Member for Adult and Community Services congratulated the other Lead Members and officers for the hard work put in to develop the report. The recommendations included would help the Council to bring about cost and efficiency savings to have a full year effect for the next financial year. Approximately £6.3m had been identified in savings and efficiencies, which represented 10% of the budget for those line items. The Lead Member for Policy and Performance added his thanks to Lead Members and officers and commented that the recommendations in the report would provide a strong financial backing for the Council’s plans. The Council needed to be careful about backing huge white elephant schemes, which were unpopular with the majority of residents.

Councillor D. Wilson congratulated Members and officers on the report. He requested clarification on Preventing Violent Extremism (PVE) funding. The Lead Member for Finance explained that £131,000 of grant funding from the government would be distributed between various partner organisations. Councillor Mrs Hunt expressed concern over the difficulties of appealing against business rate decisions. The Chairman agreed that the issue had caused distress for small businesses in Maidenhead, Windsor and Ascot. The Lead Member for Finance explained that the Borough collected Business rates on behalf of the government, but only received a small proportion of the funds back. He commented that a motion would be put to Full Council in future on the issues.

Councillor Mrs Newbound asked whether decisions re staffing levels would be discussed by Members; it was confirmed that any decisions in relation to redundancies would go via the usual Employment Panel process. She also asked how the £6m gap identified in paragraph 3.24 of the report would be filled. The Head of Finance responded that no external borrowing was anticipated.

In relation to the comments from the Adult, Community Services and Health Overview and Scrutiny Panel, Councillor Mrs Proctor highlighted that there had been a lot of disquiet from all Members of the Panel at the lack of detail, which had made it difficult to properly scrutinise the report. In relation to a number of questions posed by Councillor Mrs Proctor, the Lead Member for Adult and Community Services commented that the report identified savings in sensitive areas, which could not be subject to full discussion. A press release had been issued earlier that day to confirm the Council’s view that individualised budgets would enable people to gain control and be more empowered. Efficiencies would be derived from the change as a result of more efficient commissioning and purchasing of services. In relation to the Boyn Grove day centre, he explained that the Council wanted to ensure the Learning Disability day centre was fully up and running before the dementia service was implemented, to avoid overburdening the service. He stated that the staff were the Council’s greatest asset and it was important that the appropriate workload was achieved. The Director of Adult and Community Services confirmed that any decision based on an assessment of need would be taken by the relevant social worker. Any decision on funding followed an assessment of need by a social worker/care manger and was now subject to a funding panel to ensure the most appropriate and cost effective service was provided. If additional funds were required this would be agreed by the head of service or the Director of Adult and Community Services. Funding included for anticipated demographic growth had not been required this year.

Councillor Richards asked whether the Council’s risks would be covered if insurance premiums were reduced. The Head of Finance explained that over the last ten years, money had been put into the insurance fund above the level the actuary advised was required, therefore the reduction in premiums would have no effect.

The Chairman echoed the comments of the other Members of Cabinet on the work put into the report by Lead Members and officers.

RESOLVED UNANIMOUSLY: That:

i) The content of the Report be noted




ii) The cost pressures outlined in Appendix A be approved for inclusion in the budget proposals being developed for the 2010/11 Budget




iii) Authority be delegated to Strategic Directors and Heads of Service to make the necessary organisational changes required to deliver the savings proposals outlined in Appendix B, the impact of which will be included in the 2010/11 Budget Proposals.

Date: 22 October 2009

Member Reporting: Councillor Kellaway

Contact Officer(s): Andrew Brooker, Head of Finance, 01628 796341
Peter Brown, Chief Accountant, 01628 796207

Wards affected: All

2. SUMMARY

2.1 The preliminary budget report sets the context for discussions that have been held over the past weeks as part of the process for setting the Budget for 2010/11 which will go to Cabinet on 11^th February 2010 and Council on 23^rd February 2010.

2.2 2010/11 marks the end of the Government first three-year grant funding settlement. This gave a degree of certainty year on year but also showed a significant real-term reduction in financial support. Speculation grows about public sector spending. It now seems inevitable that the Council will receive a significant reduction in the level of financial support from the Government in the period 2011/12 and beyond. Whilst it is very difficult to predict the level of these reductions it is important that the Council starts to plan for such an eventuality.

2.3 The report discusses increased costs arising from such diverse areas as the effect of the recession, reduction in interest rates and waste disposal and considers how the Council Tax base may vary.

2.4 The report concludes with a section on School Funding and rehearses some of the challenges that the Council faces, together with the School’s Forum in agreeing to the distribution of the Dedicated Schools Grant. School Budgets will face some of the challenges facing other Council services with below inflation increases in per capita funding and emerging cost pressures, principally from complex SEN placements.

2.5 In the light of the significant pressures the Council is facing the final section seeks approval for the cost reductions that have been discussed at the Budget Steering Group with Strategic Directors.

3. RECOMMENDATION: That:

i) The content of the Report be noted

ii) The cost pressures outlined in Appendix A be approved for inclusion in the budget proposals being developed for the 2010/11 Budget

iii) Authority be delegated to Strategic Directors and Heads of Service to make the necessary organisational changes required to deliver the savings proposals outlined in Appendix B, the impact of which will be included in the 2010/11 Budget Proposals.

4. SUPPORTING INFORMATION

Background

2009/10 Budget

4.1 2009/10 has seen significant budgetary pressures arising from increases in service demands within children’s services and benefit support. By and large these pressures have been recession led and have been outside of the Council’s control. These pressure arise from:

Stagnant property market: increase in housing accommodation enquiries and rental loans; lower than expected increase in occupation of new property (thereby affecting Council Tax base) and lower income from developers (Section 106) and land charges.
Rising unemployment: increases in benefit claims; increase demand for adult and children’s services as personal finances reduce; reduced income from car parks, leisure centres and council property as organisations close and spending profiles changed.
Sustained low interest rates: loss of income to support council services

4.2 To the end of September 2009 these pressures approached £1m.

4.3 The Council recognised the potential impact of the recession when setting the budget for 2009/10 and set up a reserve to support services affected by the economic climate. This has been further enhanced with a number of in year savings, largely arising from lower than expected pay award and contract inflation.

4.4 The reserves are available to support short-term pressures. However, items that have a permanent impact on services require longer term funding and this is only achieved by increasing the demand on the council tax. Appendix A includes a list of ongoing costs that impact on 2010/11 that require Cabinet approval to include in the budget process.

GOVERNMENT SETTLEMENTS

4.5 2010/11 is the final year of a current 3-year settlement. As for the current year there is some movement of specific grant to area based grant expected but whilst these are still in debate, they should be cost neutral. One exception is a new area based grant in respect of preventing extreme violence £131k for which an equal value growth is submitted, as most of this grant is distributed to our partners.

4.6 The anticipated increase is 1.5% in 2010/11, which is approximately in line with our expected increase in the inflation on council run services. The Formula Grant methodology continues to assume that Councils will deliver 3% cash releasing efficiency measures. Since the ‘Gershon’ targets were introduced, the Borough has remained ahead of its cumulative targets; in common with most other authorities the ability to continue to meet this repeating target will become increasingly challenging.

4.7 The expected formula grant is summarised as:

	2009/10 £’000	% Increase	£’000	20010/11 £’000	% Increase
Formula Grant Base	18,257			18,536
Floor Increase		1.75	278		1.5
Technical Adjustments	279		-15	263
Formula Grant	18,536			18,799
Area Based Grant	5,445			7,014	Note 1
Total External Support	23,981			25,813

MEDIUM TERM FINANCIAL PLAN (MTFP)

4.8 The MTFP has been under constant review since it was last updated as part of the 2009/10 Budget report. The volatility in inflation rates, interest rates, and the uncertainty of the 2009/10 pay award has significant impact on the MTFP, which can show significant fluctuations between each iteration.

4.9 As discussed earlier in this report the level of public expenditure over the next few years is the subject of much speculation. It is clear that levels of Government support will be reduced, what is not clear is by how much. Given this uncertainty, the consideration of the MTFP is deferred until Council Tax setting Cabinet meeting in February

Inflation

4.10 The 2009 Budget statement from the Treasury saw significant variations in RPI and CPI inflation over the short term and predicted the RPI at September 2009 would be (-)3% with a return over the longer term to (+)2%. However, recent inflationary pressures have arisen. As this report was written the latest available inflation data showed that in August the year on year change in RPI was (-) 1.3%. Looking forward inflation is expected to rise, by all commentators, the rate of that rise being the subject of debate

4.11 Officers will continue to review inflation assumptions up to publication deadlines for the Council Tax setting Cabinet in February.

Pay Awards

4.12 Despite negative inflation rates and increasing unemployment level, and after significant negotiation the 2009/10 national pay award of 1% increase was eventually agreed.

4.13 Pressure remains on local authority budgets nationally and a number of authorities have moved away from the national review process settling for a local method that introduces greater certainty and transparency into the budget setting process. The Royal Borough is also committed to do so and negotiations with staff are ongoing. Once finalised an increase in pay will be built into the budget and enable more certainty when setting the budget for 2010/11 and onwards.

4.14 It is important to note, however, that provision of an additional 1% for pay (in non-school services) would cost close to £600k. Given the fact that Government support is unlikely to increase and that the Council has a clear commitment regarding Council Tax increases this additional provision would be at the expense of further efficiency measures.

Pensions Increase

4.15 Employer Pension contributions are currently set until April 2011 at their current level 14.7%. Since the initial impact of the stock market decline the fund has bounced back so that the fund is currently 70% funded and improving. However, it is important to remember that the actuaries take a longer, 40-year, view on the fund performance rather than short-term gains and losses.

4.16 The actuarial review in 2010 will determine the need for increase in the Employer contribution rates. There are a number of circumstance and alternative funding proposals that could delay or eliminate any increase and the Pensions Fund Manager is discussing these with the actuaries

Service Pressures

4.17 Every effort will be made, as always, to contain service pressures within existing budgets but national issues such as demographic pressures and waste management legislation are largely unavoidable. Allowance is, therefore, made for these additional costs.

4.18 Service Pressures identified to date are outlined in the attached Appendix B.

Capital Financing

4.19 The Council continues with its long term objective to fund a greater proportion of its capital spend from Revenue. This ambition is reflected in the MTFP in the form of additional annual revenue contributions to the Capital Fund.

4.20 Historically, the Council spends £1.3m per annum on ‘short life assets’, Leisure Centre equipment; IT Hardware; Vehicles etc. It is anticipated that this may reduce to £1m with the further IT infrastructure investment following a number of invest to save initiatives. The base budget for 2009/10 includes provision for a £800k contribution to the Capital Fund and an increase of £200k would therefore achieve this £1m target.

4.21 Recurring Highways, Streetlights and Property expenditure remains funded from capital resources. It remains a longer-term objective of the Council to fund a greater proportion of these costs from revenue, thereby, saving financing costs.

4.22 Government Departments announced as part of the 3-year settlement its spending allocations 2010/11. Whilst some of these allocations come to the authority in the form of grants most are in the form of ‘supported Capital Expenditure’, the revenue cost of which is, in theory, reflected in Formula Grant assessments. However, as the Council is below the grant floor, there will be no increase in grant to cover these allocations. Consequently, the impact of all capital financing directly impacts on the Council Tax.

4.23 Continued capital investment is required in the Council’s infrastructure. Therefore, surplus assets will be identified wherever possible and where appropriate those assets will be sold to support the Council’s Capital programme. Before assets are sold the Council will ensure that it is the right time to sell but more importantly whether these assets can be better used to generate revenue for the Council.

4.24 Where capital receipts or grants are not available to help fund the capital programme, the Royal Borough will have little alternative but to borrow funds, especially to finance priority infrastructure maintenance and development. Decisions on how the programme is funded will be taken by the Head of Finance in conjunction with Lead Members as part of his Treasury Management responsibilities. An assumption, carried forward from previous MTFP’s is that £6m of capital spend will require corporate funding each year.

4.25 A significant proportion of the capital programme has over the past few years been funded from s106 contributions. 2008/09 saw significant reduction in the level of receipts due to the economic climate and the impact of the proposed Community Infrastructure Levy is uncertain. Therefore, the Royal Borough cannot assume that the level of receipts attracted in the recent past will continue.

Fees & Charges

4.26 Under the current climate no increase in Fees & Charges is proposed beyond car parking changes, agree at the September Cabinet, and those are included in the savings proposals. Last year the government announced a temporary reduction in VAT that affected a number of council charges. This reduction end in January and therefore a full list of Fees and Charges will be tabled for approval as part of the council tax setting process in February.

Efficiency Savings

4.27 The Governments Comprehensive Spending Review 2007 assumes that 3% cashable efficiency savings are available in each of the three years 2008/9 – 2010/11 some £3m pa. The Royal Borough has delivered cashable savings in excess of this target and plans to deliver further savings in 2010/11 (Appendix B). In common with most other local authorities delivering the same annual value if savings becomes harder as the base budget shrinks. A time will come when value based efficiencies are not achievable without affecting the long-term sustainability of service provision.

4.28 In order that the proposed savings can be delivered in an orderly manner and that the Council can benefit from the measures at the earliest practicable opportunity authority to start implementing these proposals immediately is sought.

Interest Rates

4.29 Interest Rates have an important impact on Council Finances. However, recent decline in rates will have no effect on the cost of borrowing as the Council’s long term loans were taken out at fixed rates some while ago and further borrowing is not anticipated in the near future

4.30 The more important impact is on the interest that the Council earns on its cash balances. The recent steep decline in interest rates, to the historically low level of 0.5%, and the use of cash reserves to fund the capital programmes makes it difficult to accurately assess future income levels from this source. Interest on these balances has declined significantly over the past year and some of the longer-term investments are due to end at the end of this year. Recent short-term investments have attracted interest at 1.5% and if this continues the Council will earn around £600k in a year on its average cash balances. Many “experts” are predicting that interest rates will rise again shortly but budgeting for that increase is a risk.

4.31 The decision that the Council will need to make when it sets its budget is to what extent it maintains its longer term approach of making a cautious assessment of its investment income so that in times of higher levels of investment income, “windfall” receipts are taken into reserves, and when interest rates fall the revenue budget is supported from reserves. These reserves then being available to support short-term projects, deficits arising from changes in the economic environment or to pump prime alternative savings proposals.

COUNCIL TAX INCOME

4.32 Council Tax is the most important source of revenue for the Council, and funds a greater proportion of Council spend than most other authorities. In 2009/10 nearly 74.3% of the Councils Gross Budget Requirement (that element funded from Formula Grant, Area Based Grant and Council Tax) was funded from Council Tax. This is the 2nd highest compared to other unitary authorities where the average is 48.5%.

4.33 Annual increases in Council Tax on individual properties are supplemented by increases in the taxbase (increase in the number of properties on which the tax is levied). It is perhaps this fact that DCLG have recognised (but arguably over compensated for) in its grant distribution models.

4.34 The Council has a very clear commitment to aim to keep its tax increase below RPI; in August the year on year change was (-) 1.3%.

4.35 The taxbase for 2010/11 is the subject of a report to Cabinet in December. It is expected that it will reflect the general slowdown in the housing markets. At present collection rates are being maintained although this is one of the risks that needs to be assessed in the Budget report.

4.36 Members should note that, dependent on tax base, 0.5% in Council Tax generates approximately £340k revenue for the Council.

SCHOOL FUNDING

4.37 The main source of school funding is the ring-fenced Dedicated Schools Grant (DSG). The grant must be used in support of the Schools Budget as defined in regulations School Finance (England) Regulations 2008 cover the three year period 2008-11 and is supplemented by other sources of funding such as standards fund grants, and Learning and Skills Council funding for sixth forms.

4.38 RBWM’s 2009-10 DSG allocation was £75.873 million. The 2010-11 allocation will be determined by pupil numbers in January 2010 but latest estimates suggest an increase in total pupil numbers of around 70 compared with 2009-10. The unit rate on which DSG is calculated is fixed for the period 2008-11 and will increase from £4,193 per pupil in 2009-10 to £4,378 in 2010-11, a rise of 4.4%. This compares with an increase of 3.8% per pupil in the previous year.

4.39 The minimum increase schools can expect to receive in their 2010-11 budgets is 2.1% per pupil, as defined by the Minimum Funding Guarantee set by the Department of Children Schools and Families (DCSF). Once this school guarantee and other unavoidable inflation and contractual pressures have been met, any balance of DSG funding available, known as ‘headroom’, must be allocated either to schools directly or to central services within the Schools Budget, such as out-borough independent special school placements, and central behaviour support services. The allocation of the Schools Budget is the subject of consultation each year with the Schools Forum.

4.40 The main calls on DSG funding in 2010-11 after uplifting budgets for inflation and adjusting for pupil numbers are likely to be:

a) The one-off cost (approximately £700k) of implementing the new admissions policy for rising 5s in reception from September 2010. (DSG generated in future years is expected to cover the full year effect).

b) Any DSG deficit carried forward from the 2009-10. Latest projections suggest the 2009-10 central schools budget may be overspent by £600k. The DSG reserve at the start of 2009-10 was £146k.

c) Continuing anticipated pressures on the out-of-borough special school placements budget

d) An additional cost of around £200k related to the implementation of the new early years single funding formula.

3.41 The Council is responsible, in consultation with the Schools Forum, for determining the split of the DSG grant between expenditure on central functions and delegated funding to schools. However, DCSF regulations determine the minimum amount authorities must delegate to schools. Plans to delegate less than this amount must have Schools Forum approval.

5. OPTIONS AVAILABLE AND RISK ASSESSMENT

5.1 Options

	Option	Comments	Financial Implications
	1. Accept the report	This report is for information and explains what factors affect the budget making decision	Contained within the report
	2. Reject the report	This is not an option. The Council is required to complete its Council Tax making process

A number of the risks associated with the preparation of the budget are discussed in the body of the report. Individual risk assessments have been made for the detailed proposals being made for inclusion in the Budget for 2009-10

The biggest single risk to the Council is the impact of the “Credit Crunch” which is outlined in paragraphs 3.1.1 to 3.1.4 above

6. CONSULTATIONS CARRIED OUT

6.1 Budget proposals are being guided by Manifesto commitments made before the May 2006 elections

6.2 A series of discussions co-ordinated by the Budget Steering Group have taken place with Lead Members and Strategic Directors

6.3 Regular meetings are held with both the Windsor and Maidenhead Chambers of Commerce

7. COMMENTS FROM THE OVERVIEW AND SCRUTINY PANEL

Corporate Services Overview & Scrutiny Panel

7.1 The Panel endorsed the report but were anxious to ensure that Lead Members were kept fully engaged in the implementation of any organisational changes required to deliver savings proposals

Children’s Services Overview & Scrutiny Panel

7.2 The Panel endorsed the report. They requested that Cabinet’s attention be drawn to the budget pressures of developing fostering services and the recruitment and retention of social workers, which they considered important areas for investment.

7.3 In relation to proposed savings they expressed their concern about the lack of detail provided in the report. They were also disappointed to learn that the proposed reporting/decision making mechanisms would prevent any proper scrutiny of the proposals

Adult, Community Services and Health Overview and Scrutiny Panel

7.4 To report verbally

Planning & Environment Overview & Scrutiny

7.5 The Panel endorsed the report but were anxious to ensure that Lead Members were kept fully engaged in the implementation of any organisational changes required to deliver savings proposals.

8. IMPLICATIONS

8.1 The following implications have been addressed where indicated below.

 Meetings 091109 Acshosp Callin Budget Appx

i) The report from the Lead Inspector be received and the recommendations and the action plan be accepted.
ii) The Strategic Director of Adult and Community Services be requested to thank the Adult Social Care staff on behalf of Cabinet regarding the positive outcome of the inspection.

	Option	Comments	Financial Implications
	1. Accept the report and it’s recommendations.	CQC is a statutory organisation whose responsibilities include inspection of social care. The inspection that has taken place in the borough is part of the ongoing programme for CQC and the Royal Borough is required to co-operate.	Nil

Date: 22 October 2009

Member Reporting: Councillor Kellaway

Contact Officer(s): Andrew Brooker, Head of Finance, x6341

Wards affected: All

3. SUMMARY

3.9 This report reviews the Royal Borough’s current projected pattern of spend against its approved estimate. Appended are the Strategic Directors report on their relative performance.

1.2 The main service pressure continues to be the Children’s Safeguarding budget which was the subject a report to Cabinet in August. A number of pressures emerging from the economic downturn are addressed in this report notably the allocation of monies from the economic contingency to cover volume pressures in both the CSC and the Housing Benefits team.

3.3 The mechanism of “grazing” budgets to take known savings into reserves continues. To date a net £914k has been transferred. There are, however, some anticipated additional costs which managers are asked to reduce.

3.4 Reserves at the year-end are anticipated to be £5.796m. General Reserves balances are expected to be £3.682m with a total of £2.114m being held in the Economic Contingency Reserve. This compares with a position at the start of the year of £5.202m in General Reserves (after carry forwards) and £1.2m in the economic contingency.

1.5 There has been some slippage of the capital programme into 2010/11 but the remaining schemes totalling £54.158m are on target for 2009-10.

4. RECOMMENDATION: That:

i) This month’s movements, £154k, in the revenue budget contained in paragraph 3.2 be approved.

ii) It be agreed to use £200k of the Economic Contingency Reserve for additional Housing Benefit (and Customer Service Centre) staff, as a result of the economic downturn.

iii) The provisional revenue and capital outturn figures, and approves the slippage of £2.920m detailed in Appendix C be noted.
iv) That Directors work with Lead members to develop proposals to contain expenditure within current budget limits

5. SUPPORTING INFORMATION

5.9 Budget Movements

5.10 There have been a number of budget movements since the 1^st April 2009. These are summarised below:

		£'000
	Original Budget	87,081
1	Changes Approved up to September Cabinet	1,137
2	Building Schools for the future preliminary preparation work (approved by Cabinet)	200
	Changes Recommended for September Cabinet
3	Windsor Fire Service review	75
4	Housing Benefits staffing requirement due to economic downturn	200
5	Magnet Leisure Centre Redundancies	10
6	Other	(3)
	Reductions to support future years Council Tax
7	Underspends in Corporate Performance & Development - Budget Grazing	(78)
8	Underspend in Adult Social Care	(250)
	Total changes for October Cabinet	154
	New Service Expenditure Budget	88,372

5.11 Where there is a distinct saving the current years budget is reduced and the consequential saving diverted to a separate contingency fund. This month a further £328k was set aside. To date, £914k has been set aside this year.

5.12 Where savings are uncertain this is noted on the revenue summary and kept under review for a period of time (typically three months). If, during that time, it is clear that there is indeed a definite saving the agreed sum is extracted to the contingency fund.

5.13 Directors have reassessed their anticipated spend based on current activity and costs are expected to be £1.328m greater (last month: £0.872m greater) than the approved estimate. Each Director has summarised their service pressures in Appendix A. However the key pressures and savings arise from:

Children’s Services – Safeguarding Children. Total (+)£1,308k. Increased demand has meant anticipated staff vacancies have not occurred. The result of an external review on this position is due on 26^th October.
Adult & Community Services – Learning Disability Care Costs (-)£134k Service demand is not as high as anticipated or as nationally forecast. Ongoing savings of £250k having been transferred to contingency reserves.

6. OVERALL POSITION

General Reserves are expected to stand at £3.682m. Including the contingency reserves, the overall reserves position is therefore £5.796m. This compares to an overall reserves position last month of £5.99m and £6.402m at the start of the year.

7. CAPITAL

7.9 Capital Budget Movements

The approved 2009-10 capital budget as at £57.841m.

Exp Inc Net
£'000 £'000 £'000
Approved Budget August 2009 57,841 (46,505) 11,336
Variances identified (763) 297 (466)
Slippage to 2010/11 (2,920) 1867 (1053)
Projected capital programme 2009/2010 54,158 (44,341) 9817
Variances to September are (-)£763k compared to (-)£512k last month.

Slippage has increased from (+)£1,577k last month to (+)£2,920k. Details in Appendix C.

7.10 Overall Programme Status

The project statistics show the following position as at the end of September 2009:
09-10 08-09
Number of Schemes in Programme 488 445
Yet to Start 10% 8%
In Progress 53% 57%
(Of which Ongoing Annual Programmes 7% 7%
e.g. Disabled Facilities Grant)
Completed 22% 22%
Devolved Formula Capital Grant schemes 15% 13%

8. OPTIONS AVAILABLE AND RISK ASSESSMENT

8.9 Options

	Option	Comments	Financial Implications
	1. Accept the report	Directors have a responsibility for managing their Services within the Budget approved by Council. Cabinet has limited power to vary those budgets within the overall budget and policy framework or to re-define the priorities agreed when the budget was approved. Cabinet does however have responsibility for considering the impact on future year’s budgets of the decisions taken.	Revenue Capital
	2. Reject the report	This is not an option as The Local Government Act 2003 requires the Royal Borough to monitor its financial position	Revenue Capital

Risk assessments are carried out as a matter of course for the delivery of individual services. The main Financial risks are included on the Council’s Risk Register. The removal of budget from Directors reduces their flexibility when cost pressures arise during the year. In mitigation, where manager are unable to contain costs within revised budget provisions they can bid against the contingency pool containing the budget reduction.

The Councils Financial Strategy outlines the measures available to it in the event of a series of events that lead to significant projected budget variances being reported.

9. CONSULTATIONS CARRIED OUT

No specific consultation is carried out as this is a regular monitoring report

10. COMMENTS FROM THE OVERVIEW AND SCRUTINY PANEL

Relevant components of this report will be considered by each of the four scrutiny panels as part of their next round of meetings.

IMPLICATIONS

11. The following implications have been addressed where indicated below.

 Meetings 091109 Acshosp Service Monitoring