Small Council Tax Rise and £10.5m Of Savings Needed

January 13, 2015 by Joanna Harrison

2015/16 Budget: Small council tax rise and £10.5m of savings needed to balance books

Monday 12th January 2015

Southend-on-Sea Borough Council has unveiled an ambitious yet prudent draft budget for 2015/16 that protects front-line services, despite continued central Government cuts.

The council needs to reduce its annual spending by nearly £12.4m in 2015/16, but will protect and invest over £3m into front-line services and continue with a number of important capital projects over the next four years (see separate media release).

The council’s cabinet will consider the draft proposals at its meeting next week (Tuesday 20th January), and follows the news that the main grant the council receives from central Government will decrease by £11.1m (28%) in 2015/16. Despite this major loss of the funding, the council is yet again able to present a draft balanced budget for consultation and scrutiny. The final budget will be discussed and approved at Full Council on Thursday 26th February.

The budget proposals identify £10.5m of savings, and the use of £1.9 million of reserves to spread the budget gap over three years and avoid unnecessary short term cuts. This amount from reserves will be replenished in 2016/17 and 2017/18.

Cllr Ron Woodley, Leader of the Council, says: “We have had to make some incredibly difficult decisions that deliver significant savings just so we can balance our books. It is inevitable that as central Government funding reduces every year, the decisions get tougher and tougher. To put this in context we need to save over £33m over the next three years, which is approximately £42,000 per working day or £210,000 per working week for the next three years.

"It is no longer possible to just keep making efficiencies here and there as that has already been done. So we are faced with very stark choices about where we save, where we look at reducing services and where we look at raising charges and generating more income to protect what we offer our local people. And we must do all of this against a backdrop of increased demand for services such as social care, and changing demographics which mean we are all living longer and have more elderly people in the Borough that must be looked after. That is why we are looking at innovative proposals for how we deliver adult social care in the future both effectively and efficiently. We also have to deal with economic factors like inflation and the need to minimise impact on council staff too.

“However, I am also very clear that we must remain a forward thinking and ambitious authority and that is why we will continue to seek external funding to deliver capital projects that improve the Borough and also encourage private investment into the town.

“We cannot and will not just batten down the hatches and rein in our ambitions. That would be no good for local people, local businesses or for the economic prosperity of Southend-on-Sea. Our multi-million pound capital programme demonstrates how we can attract significant amounts of external funding to deliver major projects whilst containing the need for borrowing.

“With all of this in mind, we really have little choice but to propose a council tax rise of 1.95%, or 42p a week for a Band D household. I do not propose this lightly and accept that local people have also been impacted by the austerity measures, so we have done everything possible to avoid this. Unfortunately it is unrealistic for this authority to keep taking crippling Government cuts on the chin without at some stage having to raise council tax by a small amount. Accepting the Government’s freeze grant year on year is not sustainable in my view and only stores up problems and the likelihood of bigger council tax rises in the years ahead. This is only the second time in five years that a small tax rise is proposed and it is the right and responsible thing to do.

“If we do not do the things suggested in these proposals then we will be looking at stopping a number of services that residents value and rely on. Whilst I accept that there are elements of this budget that will not be popular, it delivers the major savings required whilst maintaining and even investing in our core front-line services that will keep the streets clean, look after our vulnerable people and ensure that we remain a competitive and popular tourist and business destination.”

Over £3m will be invested in front line services, with £635,000 to fund community support costs to help young people with a learning disability who are turning 18, to make the transition into adult social care to ensure they have positive outcomes. An additional £500,000 per year has been set aside to deal with the changing and ageing demographics of the Borough and an increased demand for 24 hour care for older people in the Borough, and £75,000 is being budgeted to meet the demand for ‘staying put’ foster placements, which is a national policy allowing foster children to stay with their foster family beyond the age of 18.

Proposals will also be discussed that would see £267,000 of reserves invested to keep Priory House care home open whilst plans are worked on for the development of an adult social care campus on the Priory site, including a dedicated specialist residential dementia care home, Extra Care Housing and a day care centre for up to 45 people with learning difficulties (see separate release).

An Energy Efficiency Team will be created with £100,000 a year of funding for two years to undertake investigation and feasibility studies into energy efficiency measures that will benefit residents and produce annual revenue savings for both the Council and Schools budgets.

£1.5m is also being invested into the ongoing base budget as part of the new county-wide waste management arrangements.

Public Health funding is currently ring-fenced and The Public Health service grant allocation for 2015/16 is £8.060 million, which is exactly the same level as for 2014/15. However, the integration of Public Health into the Council has seen financial benefits with more joint working, delivering savings of nearly £250,000 a year.

Savings will therefore be made across the three departmental spending areas as follows:
Department for People - £6.465m
Department for Place - £2.568m
Department for Corporate Services - £1.467m

In Corporate Services, £185,000 will be saved from moving staff out of the leased Southchurch Centre, enabling council staff to be concentrated in Victoria Avenue and deliver centralised services to residents. £175,000 will be raised through an increase in fees and charges within Bereavement services. A saving of nearly £20,000 will also be made from the council’s annual budget for its resident magazine Outlook, and £205,000 will be saved through a back office redesign in three areas.

In the Department for People, a redesign of the Early Offer Pathway service will help to save £100,000 from September 2015 and £135,000 per year will be found from the information, advice and guidance service currently provided to schools. This will be achieved by generating £75,000 additional income per year, and £60,000 from remodelling the services provide. It is also proposed that the current school governance service is shared with another local authority which would save £30,000 in 2015/16, with a view to creating a shared school improvement service in 2016/17 that could save more money and potentially generate extra income.

Nearly £3m of efficiencies will be found through the effective use of the Better Care Fund and other joint working with our health partners. This will enable better partnership working and joint delivery, with an expected reduction in the number of residential placements of 11.5% and longer term support for example and ensuring that health related social care is fully funded. A review of high cost placements and care packages is also underway that will realise an estimated saving of £100,000 a year. The Big Lottery Funding Fulfilling Lives programme will also help to save the Council £225,000 a year through better integrated working which will create efficiencies.

In the Department for Place, £425,000 (£850,000 in a full year) will be saved as part of the new waste collection contract which will start in October 2015. Thanks to positive negotiations during the procurement process to date, the new contract will allow the Environmental Care Team (ECO) to be redesigned, with some current duties passing over to the new contractor. This will allow the ECO team to focus on highways inspections, highway matters and improved environmental enforcement. This will save a further £180,000 a year.

The doorstep textile recycling collection will also cease saving £12,000, following a dramatic decrease in the amount of tonnage collected. Residents will still be able to recycle textiles at the Borough’s two recycling centres. A small increase in Pier charges will raise £45,000 a year, and £150,000 a year will be raised from a bigger focus and a review of street works permits that are issued at a charge to utility providers when they carry out work in the Borough.

Car park charges will also be increased, having been frozen for five of the last six years. This will generate an additional £245,000 a year and along with addressing inflationary pressures help to extend free evening parking on the seafront after 6pm all year round and bring it into line with town centre parking charges.

The much hailed LED light energy saving project, which is seeing all 14,000 street lamps across the Borough replaced will save the authority £100,000 in 2015/16. This figure will continue to rise as the five year project progresses.

New contract arrangements in Culture and Transport services which are currently going through the procurement process will save £320,000 a year, and third party payments to suppliers in Culture will be renegotiated to save £100,000 a year. The Council will also reassess how it provides water sports activities in the Borough, saving £40,000 in 2015/16. This means reviewing the Southend Marine Activities Centre (SMAC) which after Summer 2015 will no longer be able to operate at a cost to Council tax payers.

Four public toilet blocks will be closed saving £40,000 a year on cleaning, utilities, maintenance and business rates. Facilities at Ness Road and Southchurch Road are ageing and underused and public toilets at Hamlet Court Road attract high levels of anti-social behaviour which mean they are also underused. This block could be moved if a suitable location can be found. One toilet block at East Beach that is only used during the Summer will also close but the remaining public toilets at East Beach will remain open. £190,000 has been set aside in the capital programme to refurbish public toilets and the structure of the building at Thorpe Hall Avenue which are well used by the local community.

The proposals mean that a total of 38.1 Full Time Equivalent (FTE) posts have been identified as being at risk, of which 16.8 are currently vacant. Employees in the affected areas and the trade unions have been fully briefed. As in previous years, voluntary redundancy and possible redeployment opportunities to any council vacancies will be highlighted within the Council’s successful Talent Pool system, helping to keep the number of compulsory redundancies to an absolute minimum.

Councillor Ron Woodley, Leader of the Council, concludes:
“These proposals are a balance of a number of things. We are continuing to redesign our services to ensure they remain right for our residents, reviewing what we are doing and how we are doing it, renegotiating contracts with suppliers and contractors, finding new income streams and savings, making small increases to our fees and charges and prudently using reserves where there is good reason to do so. In some areas we are also investing in the front-line and working with our health partners to improve services whilst driving down costs, such as through the effective use of the Better Care Fund and Fulfilling Lives Big Lottery funding.
“Wherever possible I want to minimise the impact on our residents and also our staff. Wholesale redundancies would be counter-productive to both the local economy and also staff morale which in turn has an impact on services to residents. When you have to save £10.5m in one year, then there is inevitably going to be an impact on the workforce, but we have done what we can to reduce that impact. However, I appreciate that this budget does affect individuals and I am committed to ensuring that the right support is in place and to keeping compulsory redundancy to a minimum.
“I feel that these proposals deliver the necessary savings, whilst protecting the most vulnerable members of our community and showing that Southend is ambitious, open for business and serious about its economic future.”

The Council will consider the proposals at the following meetings:
20th January - Budget Cabinet meeting
26th to 29th January - Scrutiny Committees debate budget proposals
12th February - Second budget Cabinet meeting
26th February - Full Council meeting (to set budget and council tax)

There will also be a budget consultation event on 20th January at the Forum at 7.30am.