Agenda item

To receive a briefing on the options under consideration by Cabinet to improve financial sustainability (confidential paper attached) and consider making recommendations to Cabinet.

 

Ian Harrison, Interim Managing Director, Peter Vickers, Executive Head of Finance and Section 151 Officer and Alex Shiell, Service Manager – Policy, Strategy and Transformation will be in attendance at the meeting to guide the discussion.

 

The Leader of the Council (Gllr Gareth Williams) will also be in attendance.

The Board welcomed Mr Ian Harrison, Interim Managing Director, Mr Peter Vickers, Executive Head of Finance and Section 151 Officer and Mr Alex Shiell, Service Manager – Policy, Strategy and Transformation, who provided a briefing on the options under consideration by the Cabinet to improve the Council’s financial sustainability, with a view to enabling the Board to make recommendations to the Cabinet if it wished. Cllr Gareth Williams, Leader of the Council had also been invited to attend the meeting for this item.

 

The Board was advised that work to set the Council’s budget for 2026/27 was well underway, with final proposals going to the Council meeting on 26th February, 2026. There were a number of areas of uncertainty, such as the impact of Fairer Funding arrangements this year, along with a reset of business rates. After many years of finding ways of delivering sufficient savings to deliver a balanced budget without cutting services, it was felt that it would now be necessary to review expenditure on staffing, being a major cost centre that had not shown much change over the previous decade. It was explained that the Cabinet had worked through the base budget on a line-by-line basis with a view to a redesign in the new year that would look to identify savings of £2 million. The Board was informed that, given the influence of local government reorganisation, the need for financial sustainability and the achievement of political priorities, the Council would need to:

 

·                    Refocus budgets to support political priorities

 

·                    Reduce budgets to achieve a prudent minimum reserves balance

 

·                    Achieve financial sustainability

 

·                    Have a clear Council Delivery Plan that focussed activity on the most desired outcomes to produce improvements in residents’ lives and places, with a framework for accountability and performance monitoring

 

The Cabinet had provided the following steer in relation to the service review process in the context of its political priorities:

 

·                    Grow – relevant to services producing a net income

 

·                    Sustain – services or activity that would not provide any financial benefit from review

 

·                    Refocus / retreat – services where there were options to achieve a budget reduction and / or improved value for money through doing something different or less

 

·                    Stop – services or activity that had no statutory implication and were not a political priority or offered poor value for money

 

It was noted that growth in base budget cost, namely the expansion of a service, would be dealt with outside of this process. The Cabinet had provided a list of areas to grow income from current net income and this was included in the presentation. Also listed within the presentation were cost centres where it was recommended to sustain at the current budget level and areas where it was recommended to refocus to achieve either a budget reduction or better outcomes.

 

The Board was being asked for its views on:

 

·                    Approach to service reviews

 

·                    Categorisation of service budgets – grow income / sustain / refocus

 

·                    Implementation priority order

 

·                    Strategy to get to unitary council vesting day

 

In discussing the content of the presentation, the Board raised the following points:

 

·                    Will continue to be a challenge to explain the Council’s complex financial challenges to the public

 

·                    Acknowledged that staffing reductions would have an effect on service delivery

 

·                    Council is ensuring services are provided to a required standard by benchmarking with neighbouring authorities

 

·                    Clarified that this would be a managed process over time, with the opportunity to reshape as the process goes on and, dependent on the budget position and savings requirement at the time, compulsory redundancy would be a last resort

 

·                    Councillors suggested some areas where more information would be required before a view could be taken

 

·                    Where areas had been identified for reduce/refocus, teams have been asked to carry out their own review and bring forward proposals for how the service could be delivered in future – no targets for reductions set at this stage of the process

 

·                    Could maintenance of Council assets, including skateparks, be incorporated into one budget?

 

In thanking Mr Harrison, Mr Vickers and Mr Shiell for their contributions to the meeting, the Chair asked Members to submit any further views on this subject to Mr Shiell via email.