Agenda item

2024/25 General Fund Revenue Budget, HRA Revenue Budget and Capital Budgets

Meeting of Scrutiny Committee - Corporate and Resources, Friday, 2nd February, 2024 10.00 am (Item 71.)

To consider the 2024/25 Budget Proposals and provide feedback to the Executive for consideration. The following documents are attached:

Scrutiny of the 2024/25 Budget – pages 19 – 23.

Paper A - 2024/25 General Fund Revenue Budget – pages 25 - 63. This report has the following Appendices:

· Appendix 1: Strategic Risks associated with the budget – pages 65 - 67

· Appendix 2: MTFP Forecast – pages 69 - 70

· Appendix 3: Provisional Finance Settlement – pages 71 - 72

· Appendix 4: Changes to budget 2023/24-2024/25 – pages 73 - 76

· Appendix 5: Council Tax trends – page 77

· Appendix 6: Detailed list of savings proposals – pages 79 - 91

· Appendix 7: Detailed list of pressures – pages 93 - 98

· Appendix 8: Full & part reversals of prior year savings – page 99

· Appendix 9: Dedicated Schools Grant 2024/25 – pages 101 - 105

· Appendix 10: Summary of findings from the budget consultation exercise – pages 107 - 135

· Appendix 11: Reserves – pages 137 - 141

To view all the supporting documents, including the savings proposals, the Cumulative Impact Assessment and the relevant Equality Impact Assessment forms, please access the web library by using this link – Supporting Documents

Paper B – Housing Revenue Account (HRA) Revenue and Capital Budget Setting 2024/25 including Dwelling Rent Setting and Fees and Charges for 2024/25, MTFP and 30-Year Business Plan Update’– pages 143 – 194. This report has the following Appendices:

· Appendix A - Revenue Budget and Medium Term Financial Plan for 2024/25 – page 195

· Appendix B - Proposed Fees and Charges for Homes In Sedgemoor for 2024/25 – pages 197 - 198

· Appendix C - Proposed Fees and Charges for the In-House Service for 2024/25 – pages 199 - 209

· Appendix D - HRA MTFP 10-Year Capital Programme – pages 211 - 212

· Appendix E - HRA Proposed Capital Budgets for 2024/25 and Capital Financing per Scheme – pages 213 - 216

· Appendix F – EIA form – pages 217 - 224

Paper C - 2024/25 General Fund Capital Budget – pages 225 – 236. This report has the following Appendices:

· Appendix A: Removed schemes from Capital Programme 2023/24 – pages 237 - 238

· Appendix B: Capital Programme 2024/25 to 2026/27 – pages 239 - 243

· Appendix C: New Bids for 2024/25 – pages 245 - 247

Decision:

The Committee :

I. Scrutinised and commented on the draft budget proposals for 2024/25 and the proposed council tax increase, with reference to the cumulative impact assessment, individual equalities impact assessments and the budget consultation;

II. Scrutinised and commented on the proposed Housing Revenue Account budget for 2024/25;

III. Scrutinised and commented on the proposal Capital Budget for 2024/25;

IV. Agreed to make the following recommendations to the Executive:

Service Ref/title of budget proposal:	Proposed recommendation	Reason
OVERALL BUDGET
Capitalisation Direction and proposed additional increase to Council Tax – awaiting DLUHC approval	Scrutiny Committee to recommend to Executive and S151 Officer that it receives an update on the outcome of the capitalisation direction and council tax increase request at meeting on 7 March and if unsuccessful what mitigations are proposed	To ensure S114 is avoided
Developing the approach to Transformation (outline business case for Executive 7 February)	Scrutiny Committee to scrutinise the Outline Business Case at its meeting on 7 March	To understand the potential impact on Council services and delivery of Council Plan priorities
Level of General Reserves in 2024/25 and 2025/26 being sufficient and level of pressures for 2025/26 to avoid a S114	Scrutiny Committee to receive regular updates on the level of general and earmarked reserves in 2024/25 and projections for 2025/26, together with projected pressures for 2025/26 as part of monthly budget monitoring reports throughout 2024/25	Concerns whether the level of general reserves and potential pressures projected for 2025/26 will result in Section 114
COMMUNITIES
Appendix 6 – pg 3
Devolution of Services/Facilities to Parish/Town councils and pressures on Parishes taking on these additional areas of work	The Committee welcomes the partnership work being undertaken with Somerset’s Town and Parish Councils and recommends that Scrutiny Committee for Communities receives quarterly update reports regarding the progression and delivery of devolution of various communities services and assets to Parish and Town Councils.	To monitor the delivery of devolution proposals and whether additional capacity is needed from Somerset Council to enable this
CMS 018 (pg 3 of Appendix 6 savings proposals) - CCTV	Scrutiny Committee for Communities to receive quarterly update reports regarding the progression and delivery of income generation proposals with relevant Parish and Town Councils to deliver the target value to avoid cessation of the CCTV service.	To monitor the delivery of alternative solutions to avoid cessation of the service and provide a 2024/25 and future years viable solution
CMS022 – Octagon Theatre in Yeovil CMS038 – Westlands entertainment venue, Yeovil CMS020 – Yeovil recreation Ground	Scrutiny Committee Communities to receive quarterly updates on the delivery of the devolution of specific assets and services to Yeovil town council as alternative solutions to these savings proposals. To receive a quarterly update on the capital bid to DCMS and the potential capital investment in the Octagon Theatre	To monitor the delivery of these devolution proposals and the proposed capital project for the Octagon during 2024/25 together with delivery of any mitigations if unsuccessful

Adults & Health Services
Appendix 6 – pg 1
Significant and high risk savings proposals	Scrutiny Committee Adults & Health to receive quarterly updates on the delivery of ADS 001, ADS 004, ADS 005, ADS 006, ADS 007 and ADS 011 and scrutinise any adverse impacts on service users, partners and providers	To be assured on the delivery of the proposed savings and scrutinise any adverse impacts on service users
Children, Families & Education
Education & Inclusion	Recommend that Scrutiny Children & Families receive quarterly reports regarding the Deficit Action Plan for High Needs Block and Dedicated Schools Grant and the continuation of the statutory override	To maintain sufficient oversight on delivery of this plan and its mitigation of significant risks to the Council
Significant and high risk savings proposals	Scrutiny Committee Children & Families to receive quarterly updates on the delivery of savings proposals CFE 003, CFE 004, CFE 005, CFE 009, CFE 011, CFE 012, CFE 013 and CFE 014, together with scrutinising any adverse impacts on young people, partners and providers	To be assured on the delivery of the proposed savings and scrutinise any adverse impacts on young people
Service delivery and Ofsted rating of service for vulnerable children	Seek assurance from the Executive that the proposed savings proposals will not adversely affect outcomes for vulnerable children and the Ofsted rating that the Council has invested significant staff and financial resources to achieve

Climate & Place Services
Appendix 6 (savings) – pg 5
CAP010 Household Waste Recycling Centres	Due to significant member and public concerns about the potential closures, recommend that Scrutiny Committee Climate & Place receive quarterly updates to scrutinise the potential options to deliver this savings proposal (CAP 010) and any adverse impacts on local communities	To scrutinise adverse impacts on local communities
Significant and high risk savings proposals	Scrutiny Committee Climate & Place to receive quarterly updates on the delivery of savings proposals CAP 001, CAP 002, CAP 007, CAP 012, CAP 036 together with scrutinising any adverse impacts on local communities and partners	To be assured on the delivery of the proposed savings and scrutinise any adverse impacts on local communities
CAP 027 Transport policy post	Recommend that the Executive withdraws the proposed saving CAP 027 (£70k) in order to ensure the Council can continue to adequately bid for external funding for its infrastructure and to fund he target saving instead from savings to Local Community Networks support costs	Concerns about lost opportunity for bidding for infrastructure funding
CAP032 reduction in highways maintenance	Recommend that the Executive withdraws the proposed saving CAP 032 (£ 330k) in order to continue existing levels of highways maintenance and to fund the target saving instead from Local Community Networks support costs	Concerns over impacts to local communities and mitigate risks of reactive costs occuring
Resources & Corporate Services
No recommendations
Strategy Workforce & Localities
SWL 001	Recommend that the Executive withdraws the proposed saving SWL 001
SWL010 Reduction of Scrutiny committees SWL 006 Combine Audit and C&G Committee SWL007 reduction in size of some committees SWL012 - reduction of some SRAs	Recommend that the Executive withdraws the proposed saving SWL 010 in order to continue existing 5 scrutiny committees and support the increased frequency of their meetings and to fund the target saving and any additional costs from Local Community Networks support costs Recommend that the Executive withdraws the proposed saving SWL 006 whilst the council is in a financial emergency and completing the further review work on the Constitution Recommend that the size of each of the Planning Committees and Scrutiny Committees remains at 13 members The proposed reduction in some SRAs is not in line with the Independent Remuneration Panel’s recommendations and this saving proposal should be withdrawn and not be recommended to Council on 20 February	Significant concerns over this proposal especially during a financial emergency when greater scrutiny needed. Concerns that this will adversely impact on Council’s governance framework Concerns that reducing size of scrutiny and planning committees will adversely the democratic and local representation. Concern regarding this proposal as impacting on democracy.
Local Community Networks	Recommend that the Executive reduce the council’s budget for supporting Local Community Networks and instead share the costs of supporting these meetings with parish and town councils	Views that some of the costs to the Council of supporting the LCNs could be used to fund other savings proposals
HRA Budget 2024/25 Proposals
No recommendations

Minutes:

Overall Budget:

Councillor Leyshon introduced the budget proposal papers and Jason Vaughan as the S152 Officer went through the legal requirements to set the budget plus explained what a Section 25 statement covered, explaining that a report is needed on the robustness of the estimates in the budget and the minimal levels of reserves retained by the Council and this would be a separate report presented to Full Council.

There were a number of updates since the publication of the papers and these were as follows:

· Saving options in Communities - CCTV service, sports and leisure facilities at Yeovil Recreation Centre

· Additional funding announced by Government

· Commercial Investment income following review of portfolio by JLL

· Business Rates income following completion of return

· Updated appendix on 2024/25 Budget consultation with notice that the figures may change again as the final finance settlement is expected on 5 February 2024.

The committee also received information on the request for Exceptional Financial Support made to Government to increase Council Tax by an additional 5% plus a further £40m to fund costs of transformation/re-sizing of the Council. Members then asked questions of the officers and Executive, requesting clarification on the following areas:

information on whether all services had put forward savings and whether there were any other options being held back? Some savings could not be achieved within 2024/25 therefore would be included in following years, Transformation package will be considered by Corporate and Resources Scrutiny in March as not part of current savings proposals

Budget monitoring and level of variance of budget for Scrutiny involvement? Scrutiny and Executive receiving monthly updates and looking at favourable and unfavourable issues – early warning of issues arising and tracking of progress/actions

SEND budget and whether the High Needs Block was impacting on budget and long term implications? National issue with the projected figures/deficit to be funded by the Council, some authorities have had to have deals with Government, Somerset Council were not in this bracket at present and a Deficit Management Plan being worked on acknowledging that spend on High Needs Block and education system needed to be reduced but other issues coming into force – Scrutiny Children and Families will be tracking progress.

It was confirmed that General reserves were adequate at present, however the use of them was not sustainable in future years.

Referring to the List of Pressures, would the costs rise and is there a time when the costs would be unachievable? The projection for 2025/26 budget gap will be £104m and it was acknowledged this would be difficult to close down, reiterating that Local Government funding was broken.

The committee then considered each Service in turn and the proposals for budget savings and summary of pressures.

Community Services:

Chris Hall updated Members confirming that a lot of work and discussion was being undertaken with Parish and Town Councils in relation to devolution of various services, this has led to some services being taken on by other councils which included Yeovil Town Council confirming that they would take on the Octagon Theatre, Westlands, Yeovil Recreation Ground and Country Park for which work is still ongoing, especially around timescales and savings.

Confirmation was given that the Police would not provide any further funding for CCTV (£10,000), however discussions being undertaken for Parishes and Towns to contribute, especially if they were benefitting from the service.

Funding allocated for Bridgwater Carnival fencing and toilets were proposed to be withdrawn, however Councillor Slocombe considered that the funding was a health and safety issue and benefited the tourist industry within the County and was not just for Bridgwater, it was confirmed that the safety barriers would be in place however tourism and culture was not a statutory duty of the Authority. It was noted that there were discussions ongoing with Bridgwater Town Council to cover some of these facilities.

Work was progressing on the proposed closure of public toilets and also the locking up of public parks mechanism was being confirmed at present with relevant councils.

It was requested and agreed that regular updates on the devolution programme be provided to Scrutiny and also impact on Capital and Savings by any proposed responsibilities to Parishes. It was also requested that Parish and Town Councils be provided with training and assistance on the new responsibilities that they may be undertaking shortly with discussions being held with SALC currently.

There was also some discussion on the reduction of the grant to the South West Heritage Trust and highlighted the importance of local knowledge.

Adult Services:

There were comments and questions about the work being undertaken in communities using local providers and micro providers, along with community care. Concerns were expressed with reducing the funding for Mental Health, Drugs and Alcohol services and whether this would lead to increased costs in the future, also whether there were alternative opportunities to the work covered by Discovery.

Mt Life, My Future savings had not been met and the members asked whether this was being investigated as savings expected had been predicted to be higher. Concerns were also raised in relation to the funding available for Preventative Services and Social Care grant as it was expected that costs will grow but that the grant from Government will not meet those costs.

It was clarified that the core services provided by CAB will continue to be funded as this was part of a separate Service Level Agreement, however the savings proposed was for additional services currently being funded and these will be reassessed for alternative provision including the use of Village Agents.

Members requested that updates be provided to scrutiny on the work being provided by parish and town councils within their community and also there was a need to assess the impact on communities, although it was noted that Equality Impact Assessments had been undertaken and updated on all savings proposals being put forward.

Children, Families and Education:

Concerns were raised with the number of SEND and psychologist posts being reduced together with the rise in numbers of cases being reported as this combined would make a big impact on families, however it was noted that EHCPs would be drawn up by internal staff as the current external contractor makes the process convoluted and this change would make the plans cost effective.

It was noted that alternative funding would need to be found for virtual schooling and supporting children in schools as children in care are not automatically able to receive pupil premium payments.

Discussion was also undertaken on the move of children to foster carers from care homes as this is considered better for the child and is also less costly than care homes.

It was reiterated that the Council kept the child as the most important factor with consistent staffing, along with the quality of work and that the risk to the “good” OFSTED rating should not be affected.

It was requested that quarterly reports were needed on delivery updates, High Needs and any impact on children and services.

Climate and Place

Cllr Darch and Cllr Wilkins detailed changes to the savings proposals: recycling centres may not close, pending a negotiation with the contractor to look at other ways costs could be reduced, and there were also changes to Highways Maintenance.

Concerns were raised about the impact on local residents and the environment of the recycling centres closing, and the wider context was provided of closures happening in other councils and that once a S114 was issued, more centres would likely be closed, as we are operating above statutory requirements. The long-term impact on road quality and parish and town councils was raised for the highway maintenance cuts, and what the resulting change in service standard would look like. Councillors also raised concerns about the cuts to bus subsidies, but were informed there were not any in the current savings proposals but a review would be undertaken.

Detail was requested on budget pressures relating to contract inflation – linked with government legislation around charges for certain materials and items needing specialist care. Detail was also given on the trial of black bags for recycling to reduce costs, currently being tested in Frome.

There was also concern about the remove of Transport Policy Officers, as they apply for funding and it would reduce potential future funding opportunities. Councillors stated this was a false economy, and recommended removing this saving proposal. Concern was also raised around School Crossing Patrols being a significant risk to safety. There was also discussion around the potential impact of increasing income from planning fees and savings relating to economic development. Concern about the flood team and advertising on highways was also raised, and the risk of digital exclusion due to changes to garden waste communication.

It was requested that Scrutiny receive quarterly updates on the issue of Recycling Centres and a number of other significant and high risk savings proposals. It recommended the withdrawal of the reduction in highways maintenance saving (CAP032) and of the transport policy post saving (CAP027).

Resources and Corporate

There were no comments made on these proposals.

Strategy, Workforce, and Localities

Members raised concerns around the reduction in scrutiny at a time of considerable financial pressure and the importance of robust scrutiny. They also proposed reducing funding to Local Community Networks in order to fund these, and a debate on the impact of LCNs followed.

Concerns were also raised about SRA and members allowances, and the combining of Audit and Constitution & Governance committees when looking at their forward plan. The removal of the Pathway to Employment Scheme was also highlighted as a saving which would have a considerable impact on vulnerable people.

It was recommended that a number of savings in this area be withdrawn, see table below for details.

HRA Budget 2024/25

Detail was requested on the Staff Changes pressure, and provided that it was relating to inflationary costs and the proposed restructure and business overhead to support HRA operations.

There were no recommendations for this budget.

Capital Budget Proposals

Detail was requested on Section 106 funding and Community Infrastructure Levies, how they are collected and how it is spent. There were also queries about funding for Rights of Way, and it was explained this would be reviewed as part of the Capital Review.

Decarbonisation work was highlighted, such as the Wellington Sports Centre decarbonisation, and it was raised as to why this hadn’t been funded by grants, unlike other decarbonisation projects, and it was explained that in previous years and partially this year it had been funded by grants, and the costs only show the current year funding not from external sources.

No recommendations were made with regard to these savings.

The Committee:

II. Scrutinised and commented on the proposed Housing Revenue Account budget for 2024/25;

III. Scrutinised and commented on the proposal Capital Budget for 2024/25;

IV. Agreed to make the following recommendations to the Executive:

Service Ref/title of budget proposal:	Proposed recommendation	Reason
OVERALL BUDGET
Capitalisation Direction and proposed additional increase to Council Tax – awaiting DLUHC approval	Scrutiny Committee to recommend to Executive and S151 Officer that it receives an update on the outcome of the capitalisation direction and council tax increase request at meeting on 7 March and if unsuccessful what mitigations are proposed	To ensure S114 is avoided
Developing the approach to Transformation (outline business case for Executive 7 February)	Scrutiny Committee to scrutinise the Outline Business Case at its meeting on 7 March	To understand the potential impact on Council services and delivery of Council Plan priorities
Level of General Reserves in 2024/25 and 2025/26 being sufficient and level of pressures for 2025/26 to avoid a S114	Scrutiny Committee to receive regular updates on the level of general and earmarked reserves in 2024/25 and projections for 2025/26, together with projected pressures for 2025/26 as part of monthly budget monitoring reports throughout 2024/25	Concerns whether the level of general reserves and potential pressures projected for 2025/26 will result in Section 114
COMMUNITIES
Appendix 6 – pg 3
Devolution of Services/Facilities to Parish/Town councils and pressures on Parishes taking on these additional areas of work	The Committee welcomes the partnership work being undertaken with Somerset’s Town and Parish Councils and recommends that Scrutiny Committee for Communities receives quarterly update reports regarding the progression and delivery of devolution of various communities services and assets to Parish and Town Councils.	To monitor the delivery of devolution proposals and whether additional capacity is needed from Somerset Council to enable this
CMS 018 (pg 3 of Appendix 6 savings proposals) - CCTV	Scrutiny Committee for Communities to receive quarterly update reports regarding the progression and delivery of income generation proposals with relevant Parish and Town Councils to deliver the target value to avoid cessation of the CCTV service.	To monitor the delivery of alternative solutions to avoid cessation of the service and provide a 2024/25 and future years viable solution
CMS022 – Octagon Theatre in Yeovil CMS038 – Westlands entertainment venue, Yeovil CMS020 – Yeovil recreation Ground	Scrutiny Committee Communities to receive quarterly updates on the delivery of the devolution of specific assets and services to Yeovil town council as alternative solutions to these savings proposals. To receive a quarterly update on the capital bid to DCMS and the potential capital investment in the Octagon Theatre	To monitor the delivery of these devolution proposals and the proposed capital project for the Octagon during 2024/25 together with delivery of any mitigations if unsuccessful

Adults & Health Services
Appendix 6 – pg 1
Significant and high risk savings proposals	Scrutiny Committee Adults & Health to receive quarterly updates on the delivery of ADS 001, ADS 004, ADS 005, ADS 006, ADS 007 and ADS 011 and scrutinise any adverse impacts on service users, partners and providers	To be assured on the delivery of the proposed savings and scrutinise any adverse impacts on service users
Children, Families & Education
Education & Inclusion	Recommend that Scrutiny Children & Families receive quarterly reports regarding the Deficit Action Plan for High Needs Block and Dedicated Schools Grant and the continuation of the statutory override	To maintain sufficient oversight on delivery of this plan and its mitigation of significant risks to the Council
Significant and high risk savings proposals	Scrutiny Committee Children & Families to receive quarterly updates on the delivery of savings proposals CFE 003, CFE 004, CFE 005, CFE 009, CFE 011, CFE 012, CFE 013 and CFE 014, together with scrutinising any adverse impacts on young people, partners and providers	To be assured on the delivery of the proposed savings and scrutinise any adverse impacts on young people
Service delivery and Ofsted rating of service for vulnerable children	Seek assurance from the Executive that the proposed savings proposals will not adversely affect outcomes for vulnerable children and the Ofsted rating that the Council has invested significant staff and financial resources to achieve

Climate & Place Services
Appendix 6 (savings) – pg 5
CAP010 Household Waste Recycling Centres	Due to significant member and public concerns about the potential closures, recommend that Scrutiny Committee Climate & Place receive quarterly updates to scrutinise the potential options to deliver this savings proposal (CAP 010) and any adverse impacts on local communities	To scrutinise adverse impacts on local communities
Significant and high risk savings proposals	Scrutiny Committee Climate & Place to receive quarterly updates on the delivery of savings proposals CAP 001, CAP 002, CAP 007, CAP 012, CAP 036 together with scrutinising any adverse impacts on local communities and partners	To be assured on the delivery of the proposed savings and scrutinise any adverse impacts on local communities
CAP 027 Transport policy post	Recommend that the Executive withdraws the proposed saving CAP 027 (£70k) in order to ensure the Council can continue to adequately bid for external funding for its infrastructure and to fund he target saving instead from savings to Local Community Networks support costs	Concerns about lost opportunity for bidding for infrastructure funding
CAP032 reduction in highways maintenance	Recommend that the Executive withdraws the proposed saving CAP 032 (£ 330k) in order to continue existing levels of highways maintenance and to fund the target saving instead from Local Community Networks support costs	Concerns over impacts to local communities and mitigate risks of reactive costs occurring
Resources & Corporate Services
No recommendations
Strategy Workforce & Localities
SWL 001	Recommend that the Executive withdraws the proposed saving SWL 001
SWL010 Reduction of Scrutiny committees SWL 006 Combine Audit and C&G Committee SWL007 reduction in size of some committees SWL012 - reduction of some SRAs	Recommend that the Executive withdraws the proposed saving SWL 010 in order to continue existing 5 scrutiny committees and support the increased frequency of their meetings and to fund the target saving and any additional costs from Local Community Networks support costs Recommend that the Executive withdraws the proposed saving SWL 006 whilst the council is in a financial emergency and completing the further review work on the Constitution Recommend that the size of each of the Planning Committees and Scrutiny Committees remains at 13 members The proposed reduction in some SRAs is not in line with the Independent Remuneration Panel’s recommendations and this saving proposal should be withdrawn and not be recommended to Council on 20 February	Significant concerns over this proposal especially during a financial emergency when greater scrutiny needed. Concerns that this will adversely impact on Council’s governance framework Concerns that reducing size of scrutiny and planning committees will adversely the democratic and local representation. Concern regarding this proposal as impacting on democracy.
Local Community Networks	Recommend that the Executive reduce the council’s budget for supporting Local Community Networks and instead share the costs of supporting these meetings with parish and town councils	Views that some of the costs to the Council of supporting the LCNs could be used to fund other savings proposals
HRA Budget 2024/25 Proposals
No recommendations

Supporting documents: