Agenda item

(To receive a report by Keith Noyland – Head of Finance (Communities), which invited the Board to consider a report on the the service revenue and capital budget proposals for 2022/23, prior to its consideration by the Executive on 8 February 2021. The view of the Board will be reported to the Executive as part of their consideration of this item)

Consideration was given to a report by the Head of Finance – Communities, which invited the Committee to consider a report on the Service Revenue and Capital Budget Proposals 2022/23 which were due to be considered by the Executive on the 8 February 2022.

The report presented the budget proposals for the next financial year for Commercial, Resources and Corporate services. Due to the uncertainty in the funding position for future years, the proposals had been set for a single year.

A number of new cost pressures had emerged in addition to the pressures identified for 2022/23 in the previous year's budget process. In some areas, savings which could be made through efficiencies with no or minimal impact on the level of service delivery had also been identified.

Some of the more significant cost pressures were information management technology; increased licensing and support costs; increased requirement for document storage; additional staffing resource required to support increased demand and maintain reliability and a need for telephony licensing.

The overall budget proposals had allowed for pay inflation of 2% in 2022/23. However, this was currently being held centrally pending agreement of any pay settlement, following which service budgets would be updated.

There were unavoidable service specific cost pressures for 2022/23 totalling £1.330m which would support the delivery of Council services. These cost pressures were offset by savings and efficiencies of £1.799m which did not negatively impact the level of service delivery. Further detail of the revenue budget for Commercial, Resources and Corporate services could be found at Table A and context was provided within the report.

Other than some re-phasing of existing project expenditure there had been no changes to the previously approved capital programme relating to Commercial, Resources and Corporate services, which could be found at Table B.

A consultation meeting with local business representatives, trade unions and partners was scheduled to take place on the 28^th January 2022 and the proposals were now live on Lets talk Lincolnshire, with the opportunity for the public to comment.

The Executive Support Councillor for Resources, Communication and Commissioning hoped that by 2023 the government would have made progress on the levelling up agenda and the fairer funding review and was pleased to see that savings had been made to offset cost pressures within the budget.

Consideration was given to the report and during the discussion the following points were noted:

·         The Board supported the Budget proposals, with the exception of Councillor R B Parker who advised that he would be abstaining from the vote on items related to the Council’s budget.

·         There were very few employees of the Council on the national living wage. Any increase to the national living wage was however likely to impact on the Council’s contractors, such as those in the care worker sector which had a bigger proportion of staff on the national living wage. Contract rates were fixed in October 2021 so if the national living wage was increased, there would be a need to look at the contractual arrangements for the particular staff affected. This would result in ongoing recurring costs either following the implementation of an increase or when the contract rates were fixed the following October. Any rise in national living wages would also have an impact on the pay scales for staff as it would raise the pay for the lowest grades resulting in smaller pay differentials for the grades above, which could lead to other grades needing to be re-evaluated.

·         The Council was still waiting for confirmation of the Highways Maintenance settlement from the Department for Transport. In addition to the Council, the County Council Network and Lincolnshire MPs have been lobbying the government for the reinstatement of the Highways Maintenance funding, which was a national issue, but the current indications were not hopeful. If the government’s response was not positive, then there would be a need to look at proposals to address the shortfall.

·         The financial settlement included new burdens funding which could be used for cyber security but it was only for one year and it was unknown when it would become available.

·         The focus for the savings strategy for the 2022/23 budget was through the smarter working programme. Savings varied for each area depending on the activity undertaken, the amount of travel and the size of the team. Therefore, smaller areas of the Council such as Corporate services were proposing smaller savings compared to some other areas due to having fewer staff and less staff travelling for meetings. The Executive Director – Resources agreed to circulate a breakdown of the efficiencies made, to the Board.

·         The Transformation Programme saving was in relation to the specific team set up to deliver projects for delivering savings across the Council and related to the smarter working programme and reduced travelling costs.

·         The underlying theme for the budget was to ensure that the Council continued to deliver services at a sufficient level and at a standard the public would like to receive. Within this, there were wider themes such as the smarter working programme, the green agenda, improved communications with the public, and the broader ambitions of the Council in terms of the Greater Lincolnshire devolution agenda.

·         The Council had received a better settlement than expected, but there were still concerns with the highways maintenance funding. A lot of the savings in the budget had been previously agreed, and there would be further savings in terms of efficiencies. The smarter working agenda would release larger efficiencies, but there was a need for investment such as in IT to generate those efficiencies.

·         The planned reduction in Executive and Management support posts was due to the greater use of technology such as Teams, and a change of model from 1:1 or 1:2 support to a hub model for supporting senior management. This would not have a significant impact on the operation of the Council.

RESOLVED:

1.      That the budget proposals for the Commercial, Resources and Corporate services, as set out in the report, be supported.

2.      That a summary of the above comments be passed on to the Executive as part of its consideration of this item.