Agenda item

Received a report on the Council’s budget process for 2009/10, which included details of budget savings, pressures, invest to save and capital proposals. 

The Divisional Director of Corporate Finance outlined the key influences on the annual budget process and explained that the proposals in the report, together with any issues raised by the Board, would be incorporated into the base budget report, previously approved by the Executive on 20 January 2009, before being presented for formal approval to the Executive and the Assembly.

The level of savings had been agreed by Corporate Directors to deliver more efficient processes and protect front line services.  Some of the actions to achieve identified savings were already being implemented.

Officers confirmed savings were agreed by the various departments and it was up to the individual service to deliver the required level of savings within the designated financial year.  There had been a three to six month lead-in time to organise services to achieve the required savings in 2009/10.

Significant savings that are not made by any departmental service as set out in the report, but made in another area of the department, would be referred back to Members if there was a material policy change.  It was confirmed that there was a rigorous process in place with monthly Resource Monitoring Panels and Executive budget monitoring reports to ensure departments/services were delivering declared savings.

Arising from the discussions the following issues, as set out in the report, were raised by Members:

Appendix A – Budget Savings

·  9(S) - Cessation and reprovision of the Transport Contract was welcomed and assurances were sought that the management structure and effective processes were in place.

·  12(S) - Concern was expressed over the high level of savings relating to overtime working in leisure centres and the impact this would have on employees.  Officers stated that negotiations had taken place with trade unions and staff in respect of the current contracts of employment.  These were presently based on a 9am to 5pm contract, whereas the leisure industry is largely session work, creating a large overtime cost.

·  13(S) - Officers explained that the income would be generated by a drive to increase the number of events, as opposed to an increase in fees.

·  22(S) - It was confirmed that the Borough has been the only Local Authority in the country that has offered a free Music Service and that any necessary fees would be means tested.

·  25(S) - Proposals for savings in respect of Looked After Children – Health and Education Support (LACHES) must not compromise the delivery of the current award winning service.

·  29(S) - The Board would be given further information as to the scale-back of the Educational Psychology Service and the perception of schools financially losing out on this buy-back service.

·  There was general concern about savings through cuts in posts and resources within the Children Services Department and assurances required that proposals would be managed correctly.  Officers explained that it was not the number of children requiring services that had increased, but that the child needs have become more complex.  It was the professional view that savings could be made without a decline in services.  Safeguards would be rigorous and robust and there would be a rapid response to any identified problem or concern.

·  36(S) – There had been a huge investment in the use of technology and it was a key element of the IT strategy to improve customer service and reduce costs.

·  41(S) – The use and cost of agency staff were discussed.  Officers confirmed that the Council’s preference was to have permanent staff, but agency staff has to be employed where the need was immediate, such as waste management.  It was hard to have a single policy for all areas.

·  42(S) – Officers clarified that this was to address an imbalance and over the next year and would be ensuring the right charges were in the right area.

·  45(S) – The Corporate Director of Customer Services has been undertaking a review across the Department over the last four months to achieve a reduction in staff whilst maintaining the service levels.  The details of the review will be reported back to Board Members.

·  50(S) – IT – Review of Staffing – Currently a whole range of service delivery was being considered to achieve savings.

·  51(S) – Democratic Services Officers – Questioned, when this service had been stretched over the last three years, why so soon after agreeing a new structure three posts were deleted.  Officers responded that there had been investment in Democratic Services with additional posts.  However, the three identified posts to be deleted had not been filled.

·  54(S) – Clarification that the post referred to would become vacant in December 2008, giving a year’s saving in 2009/10.

·  57(S) – Car Parking Charges for Staff – Officers confirmed that this was focusing on the London Road, Barking, car park, but not all the detail had been worked out.  There had been evidence that, because of the high number of spaces taken by staff in the car park, residents and visitors to the town centre could not park, thus affecting trade.  No other Local Authority in London provides free parking in restricted areas.  Staff would be encouraged to use public transport where practical.

·  1C – Members felt that some costs, such as to the pension scheme, were not taken into account and recognised that redundancy costs clawed back from Departments were spread out over a number of years.  The lack of redeployment of higher grade staff was also a concern.   The Divisional Director of Corporate Finance undertook to provide Board Members with a summary of redundancy costs.

·  2C – Distribution, especially to areas where there is reported poor delivery, must be looked at.

Appendix B – Budget Pressures

·  1P – Transition of Clients from Children’s to Adults – The Board recognised that the cost had trebled from five years ago.  A huge amount of work had been undertaken to improve the service.  The Corporate Director of Adult and Community Services to be asked to explain why the figure had gone up so much.

Appendix C – Budget Options for Invest to Save

·  21S – Strategic Procurement – Over the next 12 months there are contracts totalling £75mllion for re-tender, i.e. approximately £8million per year.  Members felt that there was a lot of scope for savings in this area, with some work being kept in-house.

Appendix E – Capital Programme – New Schemes

·  A query as to the repayment term of any Council borrowing was raised and officers confirmed different loans would have different terms of repayment.  The Council does not borrow for specific projects.

·  Christmas Lighting – Members felt that local businesses should be approached to contribute to the cost in their local area.

·  Dagenham and Redbridge Football Club – Concern expressed by some Board Members as to the true cost of supporting the required development of the club’s ground.  The benefits to the local community were also highlighted.  The Divisional Director of Corporate Finance undertook to provide an estimate of the borrowing costs.

·  Cambell Infant and Junior School Expansion – Officers confirmed the investment was for expansion.  Referring to the recent fire damage at the school, the Council self insure and the claim will be funded separately.

·  Costing estimates of the various new schemes to schools were questioned.  There had been substantial funding from Government for schools and costs of works were comparable to the ‘Building Schools for the Future’ programme.  The fees and contingency sums had been built into the various new schemes.  The figure allocated for the building works alone would be provided to Board Members.

·  Containerisation of Waste – The savings were fact based on the pilot scheme, which meant that the reduction in waste would reduce charges to the East London Waste Authority.

·  Refurbishment of the Mall Car Park – The Board agreed the car park needed a considerable amount of work, but questioned the need for artwork.