Agenda item

Final Budget Proposals (including Money Plan and Capital Programme)

To consider the joint report of the Leader of the Council and the Cabinet Member for Performance and Resources concerning the Money Plan 2021-26 & Budget Proposals 2021/22.

Minutes:

70.1 The Leader of the Council, Councillor Cook moved and the Deputy Leader and Cabinet Member for Performance and Resources, Councillor Hannah Norman, seconded the Budget Proposals for 2021/22 which incorporated proposals made by the Lib Dem Group and the Labour Group.

70.2 Councilllor Cook thanked Cabinet colleagues, particularly the Cabinet Member for Performance and Resources, for their hard work on the budget proposals. He also thanked senior officers, particularly the Head of Policy and Resources for their efforts in formulating the proposals as well as staff from across the Council in advance for the work that lies ahead in delivering them.

70.3 Councillor Cook commented that much of 2020 had been dominated by the Covid-19 pandemic and the response to it. Due to prudent decision making, in previous years the administration had not needed to make savings. The pandemic, however, had brought devastation on lives and livelihoods, businesses and the economy, health and general wellbeing and damaged financial stability and it was no longer possible to operate without making some savings. This was despite there being large levels of support offered by Central Government.

70.4 Councillor Cook commended Amey and their staff who had largely kept up the delivery of waste, recycling and grounds maintenance services throughout the pandemic. They had been innovative in ensuring their staff were protected from the pandemic as far as was possible while performing their jobs

70.5 Councillor Cook also outlined a number of achievements the Council had accomplished in the past year, including:

- The acquisition of St Oswalds enabled options for the authority to proceed with a housing scheme;

- The purchase of the Eastgate shopping centre removed a lease liability for the council as well as presenting long term improvement opportunities for the city centre by changing the mix of uses;

- Regeneration was accelerating at pace all around the City.. Work on Kings Square continued apace and the High Street Heritage Action Zone had already commenced work and identified a number of projects to work on. Historic England was impressed with the speed and range of the projects that they were looking to identify further funds so that the Council could increase the speed and scope of the project. Long awaited improvements to the railway station, including new car park exits and improvements to the underpass and the station façade would be commencing shortly. Additionally, work had commenced on the remaining development of the Barbican site for student accommodation with a target completion date of summer 2022.

- The City Council responded quickly and decisively to the economic crisis caused by the pandemic lockdown. A new Cabinet portfolio was created to focus on Economic Recovery. A task force was formed comprising businesses and the key agencies to coordinate activities and had met on a monthly basis since.

- The Council had seen the benefits the IT investment. The pandemic had caused the entire council to need to work from home. The previous investment in IT – equipment and software enabled the council to be ready to meet that challenge. Proactive transformation investment meant that the Council was better prepared than a number of others.

- The past year had been an enormous challenge for the authority to meet the needs of the most vulnerable experiencing homelessness during a pandemic. The administration worked cross party in the production and delivery of the new Housing, Homelessness and Rough Sleeping Strategy in 2020.

- The Council had led successfully on the Next Steps Accommodation Programme application for the whole of the County securing £3.8m funding to deliver 51 new homes and support for single homeless households, of which £1.9m was being invested in Gloucester with homes available imminently.

- The Culture and Leisure portfolio had risen to the challenges of Covid 19 since March 2020 with enthusiasm and innovation. So much of what was achieved was as a result of working closely with various partners, such as Gloucester Culture Trust, and being able to embrace new ways of delivering benefits to communities across Gloucester. The Festivals and Events team were also very active in working with a number of partners to bring the ‘Of Earth and Sky’ artwork by renowned artist Luke Jerram to Gloucester - a significant first for Gloucester which attracted considerable interest.

- A comprehensive climate change road map has been produced by the Council, including Gloucester City hosting a county-wide climate change role, due to the Council’s credentials and ability. The road map identified quick gains some of which we are already undertaking, such as: PhotoVoltaics on council buildings, Electric cars/bikes/scooters, EV charging points, tree planting projects as well as flood management projects.

70.6 In looking forward to the 2021/22 budget and beyond, the financial environment were operating in continued to be difficult. Over the last 7 years the council had achieved cumulative savings of £5.5m which had been undertaken whilst also generating additional income for the Council.

70.7 The administration proposed to increase the Council Tax for a Band D property by £5 per year which equates to 2.48%. The average increase since the council had had a Conservative administration in 2004 was 2.3% compared to the average of 10% a year for the previous 10 years when the opposition parties ran the City Council.

70.8 Councillor Cook stated that the Administration he led was prudent in nature, as custodians of Gloucester City Council and it being their public duty to ensure the Council could successfully operate for the benefit of all residents. He advised that the Administration did not seek to spend every penny of windfall cash, despite the obvious political benefits of doing so in an election year. He stated that there were risks in the future and it was necessary to ensure that e Council’s finances were secure.

70.9 Councillor Cook advised that proposed revisions from opposition groups to freeze the planned increase in parking charges had been accepted. It had also been agreed that web casting the Council’s meetings would be progressed. A compromise position with the Labour Group’s proposal on Member grants had also been accepted.

70.10 In seconding the morion, Councillor Hannah Norman outlined further detail in the draft budget and Money Plan.

70.11 Councillor Norman stated that local government finance continued to have a difficult financial outlook, considering the continuing Covid-19 pandemic. The budget and Money Plan had been generated with prudent principles and using the best assumption on future central government changes to Business Rates baselines, New Homes Bonus and the impact of the pending three-year Fair Funding review. In December 2020, a one year settlement was detailed by Central Government which included, for Gloucester, a Lower Tier Services Grant of £157k for 2021/22 and an additional one-off New Homes Bonus of £608k.

70.12 The impact of COVID-19 and several cost pressures within the Council’s budget had unfortunately returned the Council to the position of having to find further efficiencies and savings in both 2021/22 and 2022/23, although Gloucester City was in a better position than many othersecond-tier authorities.

70.13 In regard to her own Performance and Resources portfolio, Councillor Norman advised that the following savings or income generation had been identified:

- Reduction in the number of pool vehicles

- Reduction in the HR shared service agreement

- Transition of castlemeads to a 7 day a week car park

- And a review of the corporate management function of the council

70.14 Councillor Norman advised that, as part of the Chancellor’s announcement on 4 September 2019, Council Tax could only increase by 2% or £5 annually for second tier authorities without referendum and hence, £5 was assumed annually within this plan. She further advised that details on council tax and assumptions on inflation could be found in the report. Councillor Norman informed Members that Council Tax and business rates returns (also known as the collection fund) was expected to experience a significant impact, which the council may need to manage over the first three years of the money plan.

70.15 Whilst in recent years, the Council had built up its earmarked reserves to a more acceptable level these reserves would be drawn upon, however, to support the expected reset of the business rates during the life of the money plan. Councillor Norman advised it was important that the Council maintained the estimated £1 million which would be required to manage the implications of the reset. Further, Councillor Norman stated that the Money Plan also ensured that the General Fund balance would not reduce to less than £1.325m and would increase to £1.536m by the end of the plan.

70.16 Councillor Norman outlined that a consultation on the council budget occurred throughout December and January and 305 responses were received – a summary of which could be found at Appendix 7 showing that the top five priorities identified were:

- Waste Collection and Recycling

- Street Cleaning and Litter Collection

- Environmental Health

- Parks Play Areas & Open Spaces

- Land Drainage & Flood Protection

70.17 In closing, Councillor Norman thanked officers within the finance team led by the S. 151 Officer for their hard work in generating the budget and Money Plan, especially whilst managing the financial pressures that Covid-19 had placed on the council.

70.18 Following the acceptance of proposals by the Liberal Democrat Group, Councillor Hilton moved and Councillor Wilson seconded the following amendments:

Amendment 1 – Freeze the council tax for one year

Cost £190,560 paid for by maintaining balances at £1,408,000 providing a contribution of £123,000 to freezing the council tax and reducing the new (£600,000) budget equalising fund to £532,440 providing a further contribution £67,560 to fully fund the council tax freeze.

Amendment 2 – Freeze garden waste collection charges for one year

Cost £40,000 paid for by reducing the (£900,000) Environmental Reserve to £860,000 providing a contribution of £40,000 to fund the freeze in garden waste collection charges.

70.19 Councillor Hilton thanked the finance team for assisting in providing information relevant to the drawing up on the amendments.

70.20 Councillor Hilton stated that given the projected levels of reserves and a future general fund balance, the amendments were affordable and that there would be no need for cuts to Council services. He outlined that the Liberal Democrat proposals would mean a 0% rise in Council Tax for one year while the administration proposed a 2.5% rise.

70.21 Councillor Hilton also outlined that freezing garden waste charges was within the tolerance of the draft budget as tabled. He stated that, were there to be a Liberal Democrat budget, there would be further examination of the financing of Council services as well as further proposals for income generation in the City.

70.22 Councillor Wilson stated that many residents were seeing their income squeezed through furlough, redundancies and higher prices due to trade barriers which were not in place prior to the UK’s departure from the European Single Market and Customs Union. He further stated that inflation was projected to be at 0.7% in the next financial year and that the proposed increase in Council Tax was more than three times this figure. Councillor Wilson shared his view that some of the recent funds received from Central Government be used to offset the proposed rise as so many residents were in a worse financial state than they were at the same point last year.

70.23 In relation to the amendment on freezing garden waste charges, Councillor Wilson stated that there was a need to increase uptake of the service and increasing the cost would likely not achieve this. He suggested that this was not the time to introduce such a measure.

70.24 Councillor Stephens indicated that the Labour Group would support both amendments with reservations due to the uncertainty of the position in six years time. With particular regard to the amendment on freezing garden waste charges, Councillor Stephens noted that the Council had committed to action to tackle climate change and that to increase charges would be contrary to this aim.

70.25 In relation to the proposed amendment to freeze Council Tax, Councillor Hannah Norman advised that if Council Tax was frozen for one year, it would have a cumulative impact of nearly £1m. This income gap would need to be resolved at some later stage and that lobbying efforts would be undermined by freezing Council Tax. She noted that Central Government had provided generous support packages for businesses and citizens across the country including rates relief, government backed loans and the furlough scheme.

70.26 Councillor Cook spoke specifically against the proposed amendment to freeze garden waste charges. He advised that there had been increasing costs and, whilst take up of the service had improved, it had not grown at a rate to achieve self-sufficiency. Due to collection difficulties during the first lockdown, a four month moratorium on renewal had been offered and charges had not been increased for three years.

70.27 Councillor Coole stated that the proposed increase in Council Tax was not sustainable for the future and that a fair settlement for councils was necessary. They further stated that the inherent nature of how Council Tax rates were calculated was outdated.

70.29 Councillor Hyman informed Members that a number of households in his ward had their garden waste service removed due to vehicles not being able to access properties but that a provider had stated that this could be resolved. He queried why this had not been followed up given the income that could be generated through these households.

70.30 Both amendments were put to the vote and were lost.

70.31 Following the acceptance of proposals by the Labour Group, Councillor Stephens moved and Councillor Pullen seconded the following amendments:

Additional Borrowing Approval – Housing £’s

1. Private Sector Housing Acquisition Fund

to provide temporary accommodation for

homeless households 5,000,000

2. Social Housing Investment Fund

Provision of new social housing in partnership

with registered social landlords 20,000,000

Total Cost 25,000,000

Revenue Budget one-off amendments

1. Creation of new Council owned Housing

Development Company 10,000

2. Enhanced fly-tipping and enforcement scheme:

1 year pilot targeted at Barton & Tredworth,

Kingsholm, Moreland & Westgate wards

1.5 x Enforcement Officer (Grade F) 56,500

0.5 x Education Officer (Grade E) 16,500

4 x CCTV portable units (RDC) 10,000

Sundry costs promotional/ educational

Materials. 27,500

Total Costs 110,500

3. Voluntary Sector Covid Recovery Fund 100,000

Total costs 220,500

Reverse proposed cuts to budget

1. Delete proposed reduction in member grant

allocation 19,000

19,000

TOTAL COSTS 239,500

Financing

The proposed new borrowing approvals for housing projects do not have a direct effect on the budget. All housing projects will be subject to due diligence, with agreed sustainable financial strategy that ensures they are self-financing.

70.32 Councillor Stephens outlined the amendments and thanked the administration for revising the budget to not increase parking charges and to proceed with live streaming meetings of the Council.

70.33 Councillor Stephens noted that the Conservative Group had been the administration for over a decade. He submitted that, during that time, the Conservatives had presided over cuts amounting to £12m due to the policy of austerity, more than 100 jobs had been lost, services had deteriorated and that more cuts were planned.

70.34 In relation to the Covid-19 pandemic, Councillor Stephens stated that Central Government had said to local Councils to spend whatever it took to maintain services and support and that this would be reimbursed. He stated that the government had reneged on this and that councils would not be fully reimbursed for additional expenditure and lost income.

70.35 Councillor Stephens stated that the Labour Group brought the same amendments as the previous year as the problems they sought to address persisted. He further stated that, whilst there had been some success in tackling homelessness in the City, the Council was too reliant on bed and breakfast accommodation. Setting up a Housing Development Company would seek to address this. He cited examples from other parts of the country which had instigated a similar vehicle.

70.36 Councillor Stephens stated that not enough was being done to tackle flytipping and that this had increased during lockdown. He shared his view that the proposed amendment would do more to alleviate this issue. It would enable officers to take appropriate action to identify and deal accordingly with perpetrators of flytipping.

70.37 Councillor Stephens stated, in relation to the proposed amendment on a covid recovery fund for the voluntary sector, that he did not want to see any voluntary organisation cease operations because of funding issues. He further stated that, given the good work such organisations had done through the pandemic, it was right that the Council now support them. Councillor Stephens also shared his view that to reduce the Members’ grant funding for local organisations would do damage to Members’ work with communities.

70.38 Councillor Hilton indicated that the Liberal Democrat Group would abstain on borrowing for a housing development company and would support the remaining proposed amendments on the enhanced flytipping and enforcement scheme and the voluntary sector covid recovery fund.

70.39 Councillor Watkins stated that the Conservative Group would not support the proposed amendments. She stated that it was a previous Labour government’s actions which had made austerity necessary. As good progress had been made on housing and homelessness, it was not an immediate priority to source additional temporary accommodation particularly as accommodation was coming online shortly. In relation to funding for the voluntary and community sector, Councillor Watkins highlighted that significant funds had already been made available through the County Council.

70.40 Councillor Pullen stated that the proposed amendment related to housing was about providing safe and secure homes. With regard to enhanced flytipping enforcement, he recounted a number of occasions where flytipping had been reported but that there was persistent offending. He stated that high quality CCTV would act as a deterrent.

70.41 Councillor Pullen stated that during lockdown, the voluntary sector had done an excellent job in supporting communities and that it was appropriate to assist such organisations to get back on their feet to function as they normally would have done but for lockdown.

70.42 Five Members of the Labour Group called for a recorded vote on the Enhanced fly-tipping and enforcement scheme amendment. The votes were as follows:

FOR AGAINST ABSTENTION

Haigh

Lugg

Cook

H. Norman

Gravells

Melvin

Morgan

Watkins

Hilton

Stephens

Tracey

Hanman

Lewis

Wilson

Bhaimia

Williams

D. Brown

Dee

Taylor

Field

Hansdot

Organ

Patel

Toleman

D. Norman

Pullen

Hampson

Brooker

Brazil

J. Brown

Coole

Hyman

Ryall

Walford

Bowkett

(17) (18)

70.43 All amendments were lost.

70.44 In debating the proposed budget as a whole, Councillor Stephens clarified that he had raised the matter of social rent during discussions related to the City Plan. He noted that Councillor Watkins had stated that increasing the supply of temporary accommodation was not a priority but that once the ban on evictions expired, there would be a number of residents presenting as homeless or at risk of homelessness. Councillor Stephens also queried the suggestion that there was no need to have enhanced flytipping enforcement when there had been no improvement over the past year.

70.45 The Final Budget Proposals (including the Money Plan and Capital Programme) was put to a recorded vote and the votes were as follows: