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SCRUTINY COMMITTEE (HOUSING AND PUBLIC PROTECTION)

 

Minutes of a meeting held on 6th December, 2012.

 

Present: Councillor Mrs. M.R. Wilkinson (Chairman): Councillors R.J. Bertin, J. Drysdale, Mrs. V.M. Hartrey, Mrs. A.J. Moore, R.P. Thomas and E. Williams.

 

Also present: Messrs. G. Amos, J. Farrington and B. Fisher (Tenant Working Group).

 

 

617     APOLOGIES FOR ABSENCE -

 

These were received from Councillors Mrs. C.L. Curtis (Vice-Chairman), Ms. R.F. Probert and A.C. Williams.

 

 

618     MINUTES -

 

RECOMMENDED - T H A T the minutes of the meeting held on 7th November, 2012 be approved as a correct record.

 

 

619     DECLARATIONS OF INTEREST -

 

The following declaration was received from Councillor J. Drysdale – Agenda Item No. 11 – TPAS employee.

 

 

620     INITIAL REVENUE BUDGET PROPOSALS 2013/14 (DDS AND DVSH) -

 

The Council was required, under statute, to fix the level of Council Tax for 2013/14 by 11th March 2013 and in order to do so would have to agree a balanced Revenue Budget by the same date.  To be in a position to meet the statutory deadlines and requirements for consultation as set out within the Council’s Constitution, much of the work on quantifying the resource requirements of individual services needed to be carried out before the final Revenue Support Grant (RSG) settlement was notified to the Council.  The Council’s Standard Spending Assessment (SSA) represented the Welsh Government’s (WG) view of the relative resources required to provide a standard level of service in each local authority in Wales and its primary use was to allocate RSG to these authorities.  For 2013/14 the Council’s provisional SSA was £218.838m.  

 

The Council had also been provisionally advised by the WG of its 2013/14 allocation in relation to RSG (£125.934m) and NNDR (£37.752m).  Together, these sums constituted the Council’s Aggregate External Finance (AEF). 

 

The Council would also receive a sum provisionally set at £1.246m via the Outcome Agreement Grant (OAG) for 2013/14.  This grant was an unhypothecated grant (i.e. not earmarked for particular services).  It was noted that the Council was not necessarily guaranteed to receive the full amount of the OAG.  The amount for 2013/14 would be determined by a rating score of the Council’s performance in achieving its 2012/13 Outcome Agreement targets.

 

A new responsibility had been transferred to the Council i.e. Council Tax Support.  The provisional RSG settlement included an allocation within its block grant funding in the sum of £7.514m.

 

With regard to the revised budget for 2012/13, Appendix 1 to the report set out the necessary adjustments to the original estimate for this period which were required to be made as follows (there was no overall effect on the net budget of the Council):

  • Asset Rents, International Accounting Standard (IAS) 19, and Recharges etc. - these relate to accounting items and expenditure outside the control of Services. They reflect charges to Services for the use of capital assets, changes to inter service recharges, superannuation increases not required and adjustments in respect of pensions to comply with accounting standards.  The overall impact on the Council was nil.

The following table compared the amended budget with the projected outturn for 2012/13:

 

 

2012/13

2012/13

Variance

 

Amended

Original

Projected

 (+)Favourable

Directorate/Service

Budget

Outturn

 (-) Adverse

 

£’000

£’000

     £’000

 

 

 

 

General Fund Housing

           1,020

         1,020

                           0

Public Protection

2,416

2,416

                           0

Private Sector Housing

1,520

1,520

                           0

Grand Total

4,956

4,956

0

 

Budgets were projected to outturn on target.

 

The Cabinet approved the Budget Strategy for 2013/14 and the Interim Medium Term Financial Plan on 9th July 2012 and, as in previous years, required all Directors to make the following provisions:

  • Supplementary estimates would only increase the base budget if Council had given specific approval to this effect. Increases met by virement within a year would not be treated as committed growth.
  • Directors should find the cost of increments and staff changes from their base budget unless the relevant specific approval had been given for additional funding.
  • The effect of replacing grant from outside bodies that had discontinued would not be treated as committed growth. In addition, before any project or initiative that was to be met either wholly or partly by way of grant may proceed, the exit strategy must be approved.
  • Certain items of unavoidable committed growth would continue and these include the effect of interest changes and the financing cost of the Capital Programme, increases in taxes, increases in levies and precepts charged by outside bodies and changes to housing benefits net expenditure.
  • Services would be expected to identify and achieve recurrent efficiency and other savings, including (but not restricted to) those identified in the Interim Medium Term Financial Plan.
  • It was envisaged that the costs of service development would need to be met from within the respective Directorates.

Having regard to the above, it was, therefore, proposed in respect of the 2013/14 Budget Strategy that Directors be instructed to prepare initial revenue budgets for 2013/14, in accordance with a timetable agreed by the Director of Resources. Preparation should be on the following basis:

  • Capital charges, central accommodation costs and central support costs to be estimated centrally;
  • Services to prepare baseline budgets on current service levels as set out in the 2012/13 final revenue budget report;
  • Budgets to be broken down subjectively and objectively in as much detail as deemed appropriate by the Director of Resources;
  • Budget reports to include revised estimates for 2012/13;
  • Full account to be taken of the revenue costs, other than debt charges, of new capital schemes coming into use.

A summary of the overall base budget for 2013/14 was set out in Appendix 2 of the report and this had been arrived at by adjusting the 2012/13 budget for items such as inflation and unavoidable growth. 

 

Asset Rents, IAS 19 and Recharges etc. related to accounting items and expenditure outside the control of the relevant Services.  These reflected charges to Services for the use of capital assets, changes to inter service recharges, superannuation increases not required and adjustments in respect of pensions to comply with accounting standards.

 

Recharges / Transfers - to reflect mainly transfers of functions and responsibilities between services. 

 

Budget Adjustments - comprised the estimated April 2012 pay award which did not materialise and an adjustment has been made to remove this sum from Service budgets and also the transfer into Services to fund the impact of job evaluation. 

 

The total figure for inflation relates to general price increases and a 1% allowance for pay awards.

 

Committed Growth - This was £7.514m for the new Council Tax Support scheme which is the sum included in the WG settlement as a new responsibility.

 

The savings total was the target for 2013/14 efficiency savings set as part of the 2012/13 budget process. 

 

The Final Revenue Budget proposals for 2012/13 included corporate savings targets for Services to 2014/15.

 




Efficiency Savings Targets

2013/14

2014/15

TOTAL

 

£000

     £000

     £000

Private Housing

18

27

45

Public Protection

0

29

29

Total Required for the Year

18

 

56

74

 

A detailed list of the savings targets indicated above was attached at Appendix 3.

 

A list of this Committee's 2013/14 cost pressures were identified by Services and attached at Appendix 4. 

 

These were not shown in any order of priority.

 

The Committee expressed concern with regard to the likely implications of the UK Government’s Welfare Reform Agenda and the associated cost pressures facing the Council as a consequence of the reforms as they took affect.  Brief discussion centred on some specific service implications facing the Council’s Housing Services and Benefits Service with the associated cost pressures identified in Appendix 4.

 

Having regard to the impact of existing client and vulnerable groups, the Committee considered that these cost pressures should be prioritised and that the Scrutiny Committee (Corporate Resources) be advised of the Committee’s concerns.

 

The 2012/13 Final Revenue Budget Proposals set initial corporate savings targets for the Council as a whole for 2013/14 and 2014/15 of £3.175m and £2.950m respectively with the exact level of savings required, together with their impact from 2013/14 onwards, to be considered as part of a Budget Review to be undertaken following the Council elections in May 2012.

 

The results of the Budget Review process would, therefore, inform the 2013/14 Budget Process. The purpose of the review was to ensure:

  • A sustainable budget was achieved within predicted funding levels
  • The budget was aligned to the Council’s priorities as set out in the Corporate Plan
  • Best value for money was being obtained, i.e. identifying efficiency savings, opportunities for income generation and better use of external grants

The outcome of the review would put in place a four year financial strategy for the period to March 2017.

 

The 2013/14 Review was supported by Cost Centre Analyses (CCAs) which provide details for each service area including:

  • Comparisons of the 2010/11 outturn, 2011/12 budget and actual outturn, and 2012/13 current year budget.
  • Separation of the largely controllable (e.g. salaries and wages) and uncontrollable (e.g. recharges from other departments) elements of income and expenditure.
  • Identification of the costs centres within Service Areas. 
  • A copy of the Cost Centre Analysis relating to services covered by this Committee was attached at Appendix 5.

Each cost centre has been awarded a rating that measured its relative risk (based on the Council’s risk management strategy) and corporate priority, details of which were set out in Appendix 6 to the report.

 

The Budget Working Group (BWG) was responsible for completing the Budget Review.  In coming to its conclusions, the BWG would also use high-level information on the comparative spending levels of individual services across Wales together with the financial information included in the Cost Centre Analyses.  The results of the relative risk and corporate priority assessment would also be factored in as part of this process.  Service developments in all areas will be dependent upon the eventual level of resources available.

 

The shortfall in the 2013/14 budget for the Council as a whole was £8.426m assuming all cost pressures were met.  Future resource requirements had also been assessed having regard to the likely future revenue settlements and cost pressure information provided by services to 2016/17 as shown below:

 

Matching Predicted Resources to Expenditure

2014/15

£000

2015/16

£000

2016/17

£000

Total

£000

Real Term decrease in resources

   702

1,934

1,963

  4,599

Cost Pressures

6,173

4,644

4,272

15,089

Existing Corporate Savings Targets

(2,133)

       0

       0

(2,133)

Shortfall

4,742

6,578

6,235

17,555

 

The initial projections showed a cumulative shortfall of some £25.981m for the Council as a whole by 2016/17 including the shortfall on 2013/14.  In view of the difficulty in predicting future levels of inflation and cost pressures, the above table needs to be treated with a degree of caution and the eventual position may be better or worse than stated.  In particular, changes in future settlements from WG have a significant impact. The projection assumes the level of increase in 2014/15 in Aggregate External Finance (AEF) would be in line with the forward indication received from WG.  However, for 2015/16 and 2016/17 no future indications have been received and so it has been assumed that there will be no increase.  For each 1% difference in this assumption the impact on a year's shortfall would be £1.6m.

 

The Review would further develop the above projections.  In addition it would examine the cost pressures to determine which would require funding.

 

To assist in dealing with the funding gap the savings areas previously put forward by Directors to meet the 2013/14 and 2014/15 targets were being analysed with a view to their implementation with effect from April 2013 and were set out in Appendix 3 to the report.

 

However, these will be insufficient and consequently it was proposed to request Directors to formulate additional options for savings, additional income etc. over the next four years.  This included outlining the service implications and estimated HR implications (including potential redundancies, reductions in headcount and FTEs).

 

Directors would be provided guidance by way of a target to be achieved with each Director required to identify savings equivalent to their pro rata share of the shortfall based on their controllable expenditure.  Over the four year period, this approximates to an average annually recurring reduction of about 6.5%.  It was extremely unlikely that this will be the eventual outcome of the budget review but would provide Members with options.  Schools had been excluded from the target and will be looked at during the review.  The target sums were set out in the table below, and were in addition to existing targets and relate to the whole of Visible Services and Housing and Development Services:

 

Annual Saving Target

2013/14

£000

2014/15

£000

2015/16

£000

2016/17

£000

Total

£000

Visible Services and Housing

1,166

   656

   912

   863

  3,597

Development

   662

   373

   517

   490

  2,042

Total

8,426

4,742

6,578

6,235

25,981

 

In referring to the Annual Saving Targets, the Principal Accountant indicated the specific savings that would need to be found over the above financial years within the remit of the Committee which formed part of the total savings required for both Directorates.

 

An update of the progress on the Budget Review would be reported to Corporate Resources Scrutiny Committee in January 2013.  Comments of Scrutiny Committee would be considered by the BWG prior to preparing the final budget proposals for initial consideration by Cabinet and Council in February / March 2013. 

 

Due to the 2013/14 Budget Process running in tandem with the review of the Corporate Plan it was essential that services have regard to the targets, objectives and key tasks contained within the Draft Plan when considering future cost pressures and options for savings.

 

The Scrutiny Committees were now being consulted on the proposals with any comments / recommendations being submitted to the Corporate Resources Scrutiny Committee as the lead Scrutiny Committee.  The response of all the Scrutiny Committees must be made by no later than 20th December 2012.

 

It was noted that it was also proposed to consult on the Council’s initial budget proposals with the Local Service Board partners, Town and Community Councils and the Business Sector. 

 

In terms of the role of the Cabinet Budget Working Group, this Group would be holding a series of meetings with the relevant Cabinet Members and officers to consider the budget proposals.  Any recommendations from this Group would be submitted so that the Cabinet could make its final budget proposal by no later than 28th February 2013; before making its recommendation the Cabinet Budget Working Group would consider the comments made by all the Council’s Scrutiny Committees.

 

Progress on the Budget Review would be reported to the Scrutiny Committee (Corporate Resources) in January, 2013.

 

The Cabinet’s final budget proposals would be considered by Council on 11th March 2013. 

 

Having regard to the above and related issued it was

 

RECOMMENDED -

 

(1)       T H A T the amended budget for 2012/13 as set out in Appendix 1 to the report be noted.

 

(2)       T H A T the initial revenue budget proposals for 2013/14 be noted subject to the below cost pressures being prioritised and referred to the Scrutiny Committee (Corporate Resources) for consideration:

 

            Priority 1 -   PH2 – Welfare Reform – Difference between estimated allowances given by the Authority compared to the amount included in the Revenue Support Grant; potential admin grant reduction; Council Tax relief to over 70s; potential loss on collection in respect of the bills sent to Council Tax benefit claimants

                                 PH1 – Housing / Council Tax Benefit – Discretionary Housing Payments (DHP) – Increase to permissible total (current grant is £100k).  These payments are provided to claimants in need of extra financial assistance on top of their Housing / Council Tax benefit so that they can meet their full rent / Council Tax

                                 GF1 – General Fund Housing Homelessness – An increase in homeless individuals is anticipated due to tenants falling into arrears on their rent, due to the Welfare Reform and its impact on the reduction of benefits along with the added new responsibilities of the universal credit.

 

Reasons for recommendations

 

(1)       In acknowledgement of the Scrutiny Committee’s responsibility for monitoring the budget.

 

(2)       In order that the Scrutiny Committee (Corporate Resources) is informed of the comments of the Scrutiny Committee (Housing and Public Protection) prior to making a final proposal on the budget.

 

 

621     INITIAL CAPITAL PROGRAMME PROPOSALS 2013/14 (DDS AND DVSH) -

 

Set out at Appendix A to the report were full details of the progress on the Capital Programme as at 30th September 2012.

 

The following adjustments had been requested to the Capital Programme 2012/13 in respect of the following:

  • Disabled Facilities Grants – reduce the budget to £1m. in order to reflect the maximum expenditure that could be achieved on the budget.
  • Coronation Street Green Space Improvements – acceptance of a Welsh Government’s “Tranquil Greener and Cleaner Spaces Grant” funding up to £31,400.

The Welsh Government (WG) had announced the provisional 2013/14 General Capital Funding on 16th October 2012.  The 2013/14 capital settlement represented a 10% cut in funding over the previous year’s allocation, however no further cut was identified for 2014/15.  This had been reflected in Appendix B. 

 

In the event of the UK Government commencing a further Spending Review in 2014/15, it was likely that further austerity measures would be introduced between 2015/16 and 2017/18 which would bring further cuts.  Consequently, a 10% cut each year from 2015/16 to 2017/18 had also been assumed in Appendix B.  The Budget Review covering 2013/14 and the above periods would, where feasible, need to reappraise all changes and progress those deemed to be a key corporate priority and that could be delivered within budget and on time.

 

Cabinet, on 13th February 2008, approved that the Director of Resources, in consultation with the Cabinet Member responsible for Finance, be given delegated authority to transfer supported borrowing between General Fund and the Housing Capital budgets as appropriate.  A transfer of £280,000 each year had been assumed in Appendix B for each subsequent year to 2017/18.   

 

The Major Repairs Allowance (MRA), which was a grant that provided capital funding to the Housing Revenue Account (HRA), for 2013/14 had not been announced by the WG.  Cabinet would be advised once the announcement was made.  However, an assumption had been made which was set out in Appendix B to the report that the grant would continue at the current allocation of £2.8m. in 2013/14. 

 

In addition to funding from the WG, the Council would finance part of the Capital Programme from its own resources, e.g. Capital Receipts and Reserves.  Set out in Appendix B was the proposed 2013/14 Capital Programme for services under the Committee’s remit. 

 

Analysis of Net Funding Required for the Indicative 2013/14 Capital Programme

 

GENERAL FUND

£’000     

£’000

Welsh Government Resources

 

 

Supported Borrowing

3,180

 

General Capital Grant

2,106

 

 

 

  5,286

Council Resources

 

 

Capital Receipts

5,120

 

Reserves/Leasing

3,417

 

 

 

8,522

Net Capital Resources

 

13,823

 

HOUSING REVENUE ACCOUNT

£’000       

£’000       

Housing Reserves

13,402

 

Housing Capital Receipts

392

 

Supported Borrowing

280

 

 

 

 

Net Capital Resources

 

  14,074

 

The indicative 2013/14 Capital Programme shown in Appendix B included allocations already approved by Council.  Officers had been asked to bid for those sums that they still regarded as a high priority as part of the 2013/14 bidding round and an extremely high number of bids were received.  Bids would also be evaluated in accordance with sustainable development criteria for the final capital proposals.

 

The Budget Working Group had prioritised bids based upon the recommendations of the Corporate Asset Management Group (CAMG) and were shown in Appendix B.  The method of prioritisation used in the Council’s Capital Investment Strategy was set out in the report for information. 

 

As in the case of the consideration of the Initial Revenue Budget Proposals, similar arrangements were in place for the Scrutiny Committees to pass their comments to the Scrutiny Committee (Corporate Resources) who would, on behalf of all the Council’s Scrutiny Committees formally respond to Cabinet by no later than 20th December 2012.  However, Scrutiny Committees were being asked to consider the indicative Capital Proposals and the priority given to new bids in the light of extremely limited resources that were available.  The total net capital expenditure of the proposed programme for the whole of the Council over the five years was over £105m.   

 

Managers would be asked to revisit the schemes listed in Appendix B and to confirm final cost and spend profiles prior to the final proposals being considered by Cabinet by no later than 28th February, 2013.  Cabinet’s final Capital Programme proposals would be considered by Council no later than 11th March, 2013.

 

If the schemes proposed for the whole of the Council were approved, the effects on General Fund useable capital receipts were as follows:

 

General Fund Capital Receipts

             £'000

Anticipated Balance as at 1st April 2013

7,860

 

 

Anticipated Requirements – 2013/14

(5,120)

Anticipated Receipts – 2013/14

170

Balance as at 31st March 2014

2,910

 

 

Anticipated Requirements – 2014/15

0

Anticipated Receipts – 2014/15

0

Balance as at 31st March 2015

2,910

 

 

Anticipated Requirements – 2015/16

(1,218)

Anticipated Receipts – 2015/16

448

Balance as at 31st March 2016

2,140

 

 

Anticipated Requirements – 2016/17

(928)

Anticipated Receipts – 2016/17

438

Balance as at 31st March 2017

1,650

 

 

Anticipated Requirements – 2017/18

(1,238)

Anticipated Receipts – 2017/18

0

Balance as at 31st March 2018

412

 

A Project Fund existed to finance capital and revenue projects.  The aim of the Fund was to initially finance a project with repayment of such advances (including interest) being credited back to the Fund.  The following was the projected position of the Fund.

 

Project Fund Balance

             £'000

Anticipated Balance as at 1st April 2013

4,999

 

 

Anticipated Requirements – 2013/14

(420)

Anticipated Receipts – 2013/14

122

Balance as at 31st March 2014

4,701

 

 

Anticipated Requirements – 2014/15

(1,500)

Anticipated Receipts – 2014/15

70

Balance as at 31st March 2015

3,271

 

 

Anticipated Requirements – 2015/16

(300)

Anticipated Receipts – 2015/16

70

Balance as at 31st March 2016

3,041

 

 

Anticipated Requirements – 2016/17

(300)

Anticipated Receipts – 2016/17

30

Balance as at 31st March 2017

2,771

 

 

Anticipated Requirements – 2017/18

(300)

Anticipated Receipts – 2017/18

0

Balance as at 31st March 2018

2,471

 

The above forecast balances needed to be seen in the context of significant pressures for spending which were not yet included in the Capital Programme.  These pressures included the backlog of school, highways and buildings improvements. 

 

RECOMMENDED -

 

(1)       T H A T the position with regard to the 2012/13 Capital Programme be noted.

 

(2)       T H A T the proposed Capital Programme for 2013/14 as detailed in Appendix B to the report be endorsed.

 

Reason for recommendations

 

(1&2)  In acknowledgement of the budget proposals and to allow the matter to be further considered.

 

 

622     INITIAL HOUSING REVENUE ACCOUNT BUDGET PROPOSALS 2013/2014 AND REVISED BUDGET 2012/2013 (DVSH) -

 

Each local housing authority was required under Section 74 of the 1989 Local Government and Housing Act to keep a Housing Revenue Account.  Section 76 of the above Act required local authorities to set a budget for their Housing Revenue Account (HRA) on an annual basis.  The budget must be such that the Housing Revenue Account was not in deficit at the year end.  In addition, local authorities were also required during the course of the year to review their HRA expenditure and income and if, on the basis of the information available, the account was heading for a deficit, they must take steps as were reasonably practicable to prevent such deficit.  Such a deficit would be carried forward and must be made good the following financial year.  Each local authority should endeavour to have a working balance on the HRA, for any exceptional circumstances that may arise. 

 

The level of rent increases was based on the Subsidy Determination issued by the Welsh Government (WG), however, the WG were currently reviewing whether the subsidy system would continue or if it would be replaced on 1st April 2013.  If the subsidy were to remain in place, the subsidy determination would not be known until January 2013.  An estimated average rent increase of 3%, based on the latest Business Plan, had been included in the 2013/14 initial budget proposals.  Appended to the report was the revised budget for 2012/13 and set out below was a summary table comparing the original budget with the proposed revised estimate.

 

 

2012/2013

Original

Budget

2012/2013

Proposed

Revised

Estimate

 

Variance

Favourable (-)

Adverse (+)

 

£’000

£’000

 

£’000

Housing Revenue Account

(1,902)

(1,832)

(70)

 

The net anticipated deficit had decreased by £70,000 due to Budget Reductions of £350,000 on revenue repairs and £379,000 on central recharges which had been offset by £50,000 on agency staff to deal specifically with the welfare reform, £20,000 on  other staffing including impacts of Job Evaluation, an agency anti-social behaviour co-ordinator and interim staffing and management proposals.   There was a £44,000 increase in insurance; £10,000 increase on capital financing charges, a loss of rental income though increased Void Days due to WHQS £156,000, £20,000 for the Housing Relocation to the Alps Depot, £20,000 for revenue environmental improvements; a £350,000 increased revenue contribution to capital and other small movements netting off at £9,000.

 

The Budget Strategy for 2013/14 outlined that in order to establish a baseline, services should prepare revenue budget for next year based on the cost of providing the current level of service and approved policy decisions.  This meant that the cost of price increases and pay awards should be included. 

 

Due to the nature of the HRA in that it was ring fenced and any growth had to be funded from its revenue balance, no cost pressures had been formally identified.  The budget was presented in the traditional objective analysis format.  The proposed 2013/14 budget was detailed in Appendix A to the report.  The 2012/13 Cost Centre Analysis was detailed in Appendix B to the report.   

 

The Committee expressed the view that there were indeed cost pressures facing the service i.e. the Welfare Reform Agenda.  In response the Principal Accountant clarified that the cost pressures for the HRA had already been incorporated into the published figures.

 

As a landlord, the ability of tenants to pay their rent would affect the Council’s own rent collection function. The impact of the Central Government changes to the housing benefit system was likely to lead to an increase in the level of rent arrears and consequently the provision for bad and doubtful debts in the Housing Revenue Account has been increased by £166,000.

 

The charges for rent and other services provided by the Housing Service were reviewed annually and would be subject to a future report once the information had been received from the WG.  Detailed below was a summary of the original budget for 2012/13 with the proposed budget for 2013/14. 

 

2012/2013

Original

Budget

Inflation /

 Pay Award

Committed

Growth /

Savings

Estimated

Rent

Increase

2013/2014

Proposed

Budget

£000

£000

£000

£000

£000

1,902

113

297

(445)

1,867

 

A provision for general inflation was included and an allowance was made for a pay award of 1% for 2013/14, which had been offset by the pay award budgeted but not utilised in 2012/13.  A 1% increase in pay amounted to approximately £14,000.

 

Committed growth of £297,000 was due to a number of factors, namely:

  • An increase in Capital Expenditure from Revenue Account (CERA) to finance the housing improvement programme in relation to void properties of £650,000 which was offset by a corresponding decrease on revenue repairs of £650,000
  • A net increase in increments and staff changes including interim management of £6,000
  • A £100,000 agency budget set aside specifically to deal with the welfare reform and preventing tenants falling into arrears
  • An increase in insurance of £46,000 to the projected expenditure recharge
  • An increase in the provision of HRA Subsidy payable to WG based on the latest guidance issued of £153,000
  • A decrease in Central Support recharges of £349,000 including a decrease due to Housing Improvement surveyors who were now charged directly to capital for Welsh Housing Quality Standards.
  • An increase in the bad debt provision of £166,000 to account for the anticipated loss of rent due to the welfare reform accommodations cap and the affect on individual benefits
  • A decrease in rent of £165,000 due to increased void days as a result of WHQS implementation
  • Other budget adjustments and savings totalling £10,000.

As indicated in earlier reports considered, Scrutiny Committees were being consulted on the budget proposals with the Scrutiny Committee (Corporate Resources) being the lead Scrutiny Committee who would be required to respond to the Cabinet on the budget by no later than 20th  December 2012.  Cabinet’s final proposals on the budget would be considered by the Council on 11th March 2013.

 

The Housing Revenue Account working balance at 1st April 2013 was £13,049,735. 

 

Having regard to the above and related issues it was

 

RECOMMENDED -

 

(1)       T H A T the revised budget estimate for 2012/13 be noted.

 

(2)       T H A T the initial budget proposals for 2013/14 be noted and referred to the Scrutiny Committee (Corporate Resources).

 

(3)       T H A T a further report be submitted to this Scrutiny Committee regarding the suggested increase for rent and other services once information became available from the WG.

 

Reasons for recommendations

 

(1)       In acknowledgement of monitoring the budget for 2012/13.

 

(2)       To allow further consideration by the Scrutiny Committee prior to the Cabinet making final proposals on the budget.

 

(3)       In acknowledgement of the statutory deadline to notify tenants of the new charges as required by Statute.

 

 

623     FUNDING ARRANGEMENTS FOR THE YOUTH OFFENDING SERVICE (DSS) –

 

The Youth Offending Service was a highly regulated, non-devolved service overseen by the Ministry of Justice and the Youth Justice Board.  The Crime and Disorder Act 1998, Section 39(1) placed a duty on each Local Authority, acting with its statutory partners (Police, Probation and Health) to establish a Youth Offending Service in their local area to deliver youth justice services.  In addition, Section 38(3) of the above Act placed a duty on Local Authorities and statutory partners to make payment towards the expenditure incurred in providing the relevant services.

 

The report set out the current funding arrangements for the Youth Offending Service (YOS) and the potential impact of proposed changes. 

 

A breakdown of the 2012/13 budget was set out in Appendix A to the report and demonstrated the insecure nature of significant contributions to the budget.  The Committee was also advised of the wide ranging current funding pressures on the service. 

 

The Ministry of Justice was the principle funder of the Youth Justice Board which was given a target in 2010 as part of the UK Government’s Comprehensive Spending Review to reduce its annual budget by 23% over the subsequent four financial years.  The Youth Justice Board (YJB) was responsible for funding custodial placements within the secure estate for children and young people.  This accounted for the majority of the budget with the remaining funding allocated to YOS programmes.  The YJB had given a commitment to protect as far as possible front line grants to YOS although, during 2011/12, a large proportion of the funding received from the Department of Education to fund prevention was moved to the Early Intervention Grant in England and the level of Home Office funding had also been reduced significantly because of its own ministerial budget cuts.  Grant funding received by the Council from the Ministry of Justice / YJB had reduced from £306,000 in 2010/11 to the current level of £225,000 for 2012/13 which had been partly offset by £62,000 in growth within the YOS Council budget during 2011/12 budget process. 

 

In tandem with the above the Council’s budget was also adversely affected by the above Spending Review and its effect on the allocations to the Welsh Government.  In 2010, the Council’s YOS was asked to make over a period of three years savings of £65,000 (9% of the 2010/11 budget).  Coupled with a reduction in funding of 23% from the YJB this meant that the YOS had to review all services and prioritise those delivered directly to children and young people.  Consequently, a range of savings were identified which included staff redundancy, reduction of hours for some posts, the decommissioning of some services such as the Taith Project for children who abuse others and removal of staff “on call” provision based on volunteers being supported to provide an out of hours provision.  In addition and following the transfer of the service to Children and Young People Services in April 2012, the service was also required to identify additional savings as part of the Social Services Directorate’s Budget Programme.  In line with other operational teams within the Division, the required savings amounted to 5% of the Council controllable budget which equated to approximately £21,000 for 2013/14. 

 

Funding contributions were also received from the following organisations:

  • South Wales Police – secondment of a full time Police Constable to the YOS and the provision of £5,695 cash contribution towards capitation, administrative support and the YOS manager’s salary.  This contribution both in cash and services was reduced in 2011/12 by £10,145 overall of which £2,875 was a cash contribution.
  • Wales Probation Trust – secondment of a full time Probation Officer to the YOS and the provision of £5,576 cash contribution towards YOS running costs.
  • Local Health Board – employment and commissioning of services for the YOS in the form of a full-time Inroads Substance Misuse worker, a part-time (four days) physical health nurse and a part-time CAMHS substance misuse nurse with no cash contribution made.

In addition to the above funding reductions the budget for the YOS was also facing a number of risks in relation to the following matters:

  • Proposed changes to the YJB funding formula – as a result of the UK Government’s localism agenda and a reduction in monitoring requirements, the Youth Justice Grant has been transferred into a single funding pot with one set of terms and conditions.  The aim was to allow YOS to focus their resources on tackling local issues without the constraints of specifically targeted funding streams.  The YJB had been consulting various stakeholders over the past 18 months in respect of the review of the funding formula across England and Wales and how a single funding formula for the grant and distribution of the same was done in a fair and equitable way and used to support the delivery against the three youth justice outcomes, namely reducing first time entrants, reoffending and the use of custody.  Accordingly, in August 2011 the YJB produced four options outlining how potential changes in the funding formula would impact on individual YOS.  The worst case scenario for the Council’s YOS was a reduction of £38,000 equivalent to approximately 16% of the YJB grant received.  Whilst the three other options indicated that the Council may benefit initially from additional grant funding, it was likely that this would be short lived as the proposed allocation outlined in the letter was based on historical data.  Since 2010 the Council’s YOS had invested heavily in prevention and early intervention which had resulted in the Vale’s YOS improvements in either keeping young people out of the Youth Justice system entirely or moving the offence trend toward lower level crimes which would have a detrimental impact on the amount of the funding received.  It was noted that the change in the funding formula was scheduled to be introduced in 2012/13 but had been delayed.
  • Ministry of Justice / YJB – Payment by Results – the proposed introduction of payment by result had been delayed pending the review of the Youth Justice Grant being finalised.  However, the Ministry of Justice and the YJB were consulting with stakeholders about the introduction of payment by results by 2013/14.  Two proposals were included in the consultation exercise, namely to “top slice” a percentage of the YJB grant centrally, possibly by 10%, and distribute it to those YOS that improved the most; or to withhold a percentage of each YOS allocated grant and only issue this when the required performance had been met.  Indications during the consultation exercise were that YOS would only receive the withheld funding if they achieved performance in the top quartile across all three youth justice indicators.
  • Ministry of Justice – Devolving the Cost of Youth Remands – Under Section 4(5)(k) of the Crime and Disorder Act 1998, the YJB could offer assistance to Local Authorities to discharge their duty to place a young person subject to a Court Ordered Secure Remand in either a secure children’s home or secure training centre.  As a result of this arrangement any young person ordered to be secured through the criminal courts could be placed via the YJB Placements Team and the Local Authority was charged one third of the cost of the bed price for the placement.
  • The Legal Aid, Sentencing and Punishment of Offenders Act (LASPO) will introduce changes to the current remand arrangements and would have a significant impact on the Council including:
  • the transfer of financial responsibility for the cost of the whole remand to Local Authorities (YJB currently funded two thirds of the cost)
  • a new burden of responsibility for the cost of whole remand for young people placed in Young Offenders Institutes
  • any young person remanded would receive Looked After Child (LAC) status, with those remaining on remand for more than 13 weeks plus acquiring leaving care status.

The UK Government believed that by introducing stricter criteria for remand and devolving the entire cost of youth remands to individual Local Authorities, each area would be incentivised to prevent young people from entering custody. 

 

The proposed changes to Youth Remands were implemented on 3rd December 2012. 

  • Police and Crime Commissioners (PCC) – Prevention and Diversion – the YOS Prevention Service was grant funded and was at risk beyond 31st March 2013 for a number of reasons which were detailed in the report.  Currently the YOS received Home Office funding via the YJB in respect of prevention of offending and from 2013, this funding would be allocated to the PCC to distribute.  The Welsh Government provided grant funding to the Safer Vale Partnership in the form of Safe Communities Fund.  In 2012/13 this amounted to £188,576 of which the YOS received approximately £83,000, the Youth Services Target Community Prevention (detached outreach service) £70,000 and the Safer Vale ASB Unit £35,000. 

The Vale YOS in partnership with South Wales Police and Cardiff YOS operated a triage or diversionary service provision.  This Service was originally funded by the Home Office but when the funding ended, Cardiff YOS continued to operate the service in the Police Custody Suite utilising Safer Communities Funds (SCF) at no cost to the Council.  The scheme was at risk because both the SCF funding and YJB prevention funding were uncertain.

 

In addition to the above matters, the introduction of prevention and diversion services by the YOS demonstrated a significant reduction in numbers of young people entering the Youth Justice System, details of which were highlighted in paragraph 29 of the report.  The Committee were advised that any loss of either prevention or diversionary services could see a significant increase in the number of young people entering the Youth Justice System in the Vale of Glamorgan and consequently would result in poorer outcomes for children and young people, as well as having an adverse impact on the Council’s YOS performance with implications for both YJB grant and other funding received by the Service.

 

The Committee expressed concern in regard to the potential implications of the proposals for the YOS which, if realised, would have serious funding implications for the Council.  The good work of the service to date was acknowledged by the Committee and discussion ensued in respect of existing collaboration arrangements and future opportunities.

 

RECOMMENDED – T H A T the report be referred to the Cabinet for their attention with a view to Cabinet being requested to write on behalf of the Council to the Minister of Justice and the Youth Justice Board expressing concern regarding the impact of the proposed legislative changes and the ensuing funding implications for the Council's Youth Offending Service.

 

Reason for recommendation

 

To make Cabinet aware of the legislative changes and the consequential funding implications for the Council.

 

 

624     AIR QUALITY REVIEW AND ASSESSMENT (REF) –

 

The above matter had previously been considered by the Cabinet at a meeting held on 19th November 2012 (Minute C1908) and had been referred to the Scrutiny Committee for consideration as part of the Council’s wider consultation on the declaration of an air quality management area in regard to Windsor Road, Penarth. 

 

The Cabinet at the above meeting had received an executive summary of the Updating and Screening Assessment (USA) report which had concluded that the majority of the Vale of Glamorgan’s air quality was compliant with the objectives but recommended that there be continued monitoring to assess the impact of ongoing development, traffic flows and new sources of pollution. 

 

The USA report also identified the recommended further actions to monitor or address air quality to include:

  • a recommendation to declare an Air Quality Management Area (AQMA) for a section of Windsor Road, Penarth
  • to further monitor for Particulate Matter (PM10) at Windsor Road, Penarth using more sophisticated equipment as potential exceedence of the relevant objective was identified
  • further monitoring and assessment of air quality in Holton Road, Barry, where the public may be exposed to traffic pollution for more than one hour due to e.g. out door dining
  • further monitoring and assessment of air quality in Cogan within 12 months of the declaration of an AQMA along Windsor Road, Penarth.

The Cabinet at that time had been informed that steps had already been taken to address these matters, including increased monitoring of air quality at Holton Road, Barry, Cogan and Windsor Road, Penarth. 

 

The Committee was advised that under Part IV of the Environment Act 1995, the Council had a statutory duty to consult residents, statutory consultees and other stakeholders before declaring, varying or revoking an AQMA and consequently, the Cabinet had approved the carrying out of a consultation exercise on a proposed Air Quality Management Area for Windsor Road, Penarth over a ten week period commencing on 2nd January 2013.  Local Ward Members and residents would be invited to briefing sessions on the proposals.

 

RECOMMENDED – T H A T the Cabinet's decision to consult on the declaration of an Air Quality Management Area for a designated area of Windsor Road, Penarth be endorsed.

 

Reason for recommendation

 

To respond to statutory consultation exercise.

 

 

625     CORPORATE PLAN (REF) –

 

The above matter had been considered by the Cabinet at its meeting held on 19th November 2012 and had been subsequently referred to this Scrutiny Committee for comments.

 

A review of the current Corporate Plan began in August 2012 and was being undertaken in conjunction with the Council’s budget review.  This process would ensure that the Corporate Plan accurately conveyed the Council’s priorities and that budget proposals were developed in line with an up to date Corporate Plan. 

 

The Plan in itself set out how the Council would deliver the aims of the community strategy and provided a focus for the Council’s approach to corporate governance and community leadership.  The Council’s Medium Term Financial Plan outlined how the Plan would be funded in future years.  The Plan also provided a foundation for the annual Service Plans and the annual Improvement Objectives.

 

In order to develop the priorities and objectives in the new draft Plan, it was proposed that workshops would be held with Cabinet Members and Officers and, subject to this exercise, the Corporate Management Team would produce a new draft Plan for consultation ensuring that it was aligned to the community strategy for 2011-21, improvement objectives, the outcome agreement and reflected the results of the Council’s public opinion survey for 2011/12. 

 

The Scrutiny Committees would continue to monitor the Plan and receive regular reports on progress in delivering service plans and performance indicators in the future.

 

A range of consultation exercises would be undertaken by the Council to consult with residents on both the draft Corporate Plan and the budget review process, including making available documents on the Council’s website, via e-news and on social media accounts and separately it was proposed that the Council’s Corporate Consultation Officer would be available to visit consultation forums to facilitate open discussion.

 

Having regard to the above and related discussions, it was

 

RECOMMENDED – T H A T the contents of the draft Corporate Plan be noted.

 

Reason for recommendation

 

In acknowledgment of progress made to date in drafting the above document.

 

 

626     QUARTERLY PERFORMANCE AND ACTION MONITORING -  QUARTER 2 – BUILDING SERVICES (DVHS) –

 

The Operational Manager for Public Housing commented on behalf of the Head of Building Services on performance indicators and actions for the above period. It was noted that with regard to Action Monitoring of the total of 25 actions, 3 were completed, 11 were on track with 5 identified as slippage and 6 not started with the associated reasons for slippage indicated within the report.

 

RECOMMENDED – T H A T the position with regard to Building Services Quarter 2 and Action Monitoring be noted.

 

Reason for recommendation

 

In acknowledgement of taken in meeting performance and action targets in Quarter 2.

           

 

627     QUARTERLY PERFORMANCE AND ACTION MONITORING -  QUARTER 2 – PUBLIC PROTECTION (DDS) –

 

The Head of Public Protection commented on his performance indicators and actions for the above period and referred to progress in the below performance indicators and / or actions:

 

PI Description

Comment

PPN001iiQ - The percentage of high risk businesses that were liable to a programmed inspection that were inspected, for food hygiene.

 

A sharp increase in reactive work during Q1&2 had delayed the planned inspection programme.

 

PPN001iQ - The percentage of high risk businesses that were liable to a programmed inspection that were inspected, for trading standards.

 

All high risk visits due during Q1 & 2 had been completed (this was not 50%) All high risk inspections would be completed by the end of Q4.

4 inspections out of 12 have been completed and 1 business closed before it could be inspected.

 

PPN001ivQ - The percentage of high risk businesses that were liable to a programmed inspection that were inspected, for health and safety.

PSR009aQ - The average number of calendar days taken to deliver a Disabled Facilities Grant for children and young people.

 

No high risk inspections were due during Q1 & Q2.

National led project inspections due during Q3 & Q4.

42% improvement on the 2010/11 Welsh Average. Additional resources have been directed at this service area for 2012/13.

 

 

It was noted that with regard to Action Monitoring of the total of 56 actions, 7 were completed, 26 were on track, and 19 had slipped with 4 yet to be started with the associated reasons for slippage indicated within the report.

 

RECOMMENDED – T H A T the position with regard to Public Protection Quarter 2 and Action Monitoring be noted.

 

Reason for recommendation

 

In acknowledgement of action taken in meeting performance and action targets in Quarter 2.

 

 

628     QUARTERLY PERFORMANCE AND ACTION MONITORING -  QUARTER 2 – PUBLIC HOUSING (DVHS) –

 

The Operational Manager (Public Housing) commented on his performance indicators for the above period and referred to progress in the below performance indicators and / or actions:

 

PI Description

Comment

L824Q - (HHA011Q) The percentage of households accepted as statutorily homeless during the year to whom a full homelessness duty has been discharged by the same local authority within the last 2 years.

 

Increase due to the re-offending behaviour of our prison leaver category group.

 

L936Q - Percentage of employees that leave the employment of Housing Services during the year.

 

4 members of staff had left out of an average headcount of 57.5 FTE.

 

 

It was noted that with regard to Action Monitoring of the total of 38 actions, 19 were completed, 6 were on track, and 10 had slipped with 3 yet to be started with associated reasons for slippage indicated within the report.

 

RECOMMENDED – T H A T the position with regard to Public Housing Quarter 2 and Action Monitoring be noted.

 

Reason for recommendation

 

In acknowledgement of action taken in meeting performance and action targets in Quarter 2.

 

 

629     MATTER WHICH THE CHAIRMAN HAD DECIDED WAS URGENT -

 

RESOLVED - T H A T the following matter which the Chairman had decided was urgent for the reason given beneath the minute heading be considered.

 

 

630     TENANT GOVERNANCE STRUCTURE (TENANT ENGAGEMENT) – PROGRESS UPDATE (DVSH) –

Urgent by reason of the need to seek the Committee’s views prior to the Tenants Vale Housing Panel AGM to be held on 11th December 2012

 

Consideration was given to proposals for introducing a new Tenant Governance Structure which would include the disbanding of the current Vale Housing Pane, and transferring its membership to the Tenants Working Group to continue working with Council officers until the new governance arrangements were in place.  It was noted that the final Annual General Meeting of the Vale Housing Panel had been arranged for 11th December 2012 and accordingly the views of the Scrutiny Committee were sought on the following proposed governance arrangements.

 

The intention was to establish a Vale Wide Working Group which would be open to any Council tenant or leaseholder across the Vale of Glamorgan to attend.  The Chairman, Vice-Chairman and Secretary of this group were to be appointed annually at the Annual General Meeting.  To facilitate the creation of the above Group, democratic elections would be held in each of the four WHQS areas via a postal ballot which would appoint 12 tenant representatives (3 representatives from each of the four WHQS areas) and would establish a new Vale Housing Project Group.

 

Council tenants with at least one year secure tenancy would be entitled to nominate themselves for election to their respective WHQS areas with any nominee once elected completing a term of office up to April 2017 when the Housing Improvement Programme would be complete.  At that time, it was proposed that further elections would then take place.

 

Once the above elections had been completed a further election would be held to elect two of the 12 appointed tenants to sit on the Housing Programme Board to oversee the implementation of the Housing Improvement Programme (by the Vale Housing Project Group themselves) and to represent tenants across the Vale of Glamorgan. 

 

The Vale Wide Working Group would be responsible for election 12 tenants to sit on each of the following bodies:

  • Quality and Design Forum (including Chairman)
  • Housing Services Review Group (including Chairman).

In regard to the Sheltered Housing Forum, it was proposed to elect three officers via a postal ballot of all sheltered housing tenants within the Vale of Glamorgan with at least one year’s secure tenancy. 

 

It was noted that new constitutions would need to be established for the following:

  • Vale Wide Working Group
  • Vale Housing Project Group
  • Sheltered Housing Forum
  • Tenant Resident Groups.

The Committee was also advised that although there were 12 Tenant Resident Groups at present, the Council would investigate whether other groups could be established, in particular rural Vale and a younger tenant group.

 

The Committee was also advised that with regard to the Scrutiny Committee’s existing non-voting co-opted tenant representatives, there would be no change to the current arrangements other than that these tenants’ representatives in the future would be elected by the Vale Wide Working Group. 

 

To involve Tenant Engagement Associates (TEAs) into future governance arrangements, an accommodation facility to establish a Tenants Resource Centre had been identified on the ground floor of the Civic Offices.  TEAs would be able to utilise the accommodation on a daily basis and would be supplied with a computer, telephone and printing facilities (supplied by the Council) to provide an additional service to other Council tenants who may prefer to deal with other tenants in dealing with their issues.

 

The Committee was informed that the above proposals had been discussed with tenants groups over the previous months with progress being made during that period to overcome some of the barriers referred to in the report.

 

Representatives from the Tenant Participation Advisory Services (TPAS) had assisted the Council in meeting and facilitating sessions with tenants in moving towards the new governance arrangements.  Tenants’ views had also been taken into consideration and these were set out in Appendix 1 to the report.  It was anticipated that the process for electing tenants to the above Groups would commence in the New Year. 

 

RECOMMENDED –

 

(1)       T H A T the contents of the report and progress made to date be noted.

 

(2)       T H A T the proposed tenant governance structure (Tenant Engagement) proposals as set out in the report be endorsed.

 

Reasons for recommendations

 

(1)       In acknowledgement of progress made to date in regard to new arrangements.

 

(2)       To allow the necessary elections to be held in the early part of 2013.

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