Contact: Jon Pittam, ext 7400

1. Summary

1.1 This report suggests an approach that might be developed for undertaking budget consultation for 2004/05.

1.2 The following decision is sought:

· to agree the budget consultation process in preparing the 2004/05 budget strategy

2. Reason

2.1 The County Council will continue to lose Government grant in 2004/05 and 2005/06. It needs to develop its budget strategy in relation to the potential loss of grant and its effect upon council tax rises and service levels. The County Council will wish to develop its existing consultation processes and adopt best practice in budget consultation during 2003 to help inform its budget strategy for 2004/05.

3. Other options considered and rejected

3.1 Not applicable.

4. Conflicts of interest declared by the decision maker or a member or officer consulted

4.1 Not applicable.

5. Dispensation granted by the Standards Committee

5.1 Not applicable.

6. Reasons for the matter being dealt with if urgent

6.1 Not applicable.

Approved by: Date:

Councillor T K Thornber

Contact: Jon Pittam, ext 7544

1. Introduction

1.1 A financial forecast for 2004/05 and 2005/06 was presented to the Cabinet in February when setting the budget for 2003/04. None of the uncertainties in the next two years have been resolved in the meantime, particularly the overall consequential effect on the per pupil funding increase and withdrawal of current transitional grant protection for schools

1.2 However the County Council does have the opportunity during 2003 for a fuller consultation on budget options for 2004/05, despite the degree of uncertainty about the implications of particular options.

2. Budget Consultation

2.1 The Cabinet has considered the need for additional consultation against new Government guidelines on a number of occasions. Because of the late settlement for 2003/04 and the `Hands off Hampshire' campaign the Cabinet decided not to consult further on council tax levels before setting the 2003/04 budget.

2.2 The difficulties in planning for budget and council tax levels against the uncertain backdrop on floors and further reduction in Government grant in 2004/05 suggests that more budget consultation will be required during the summer to help inform the Cabinet in setting its budget strategy.

2.3 The Cabinet at its meeting on the 10 February 2003 agreed to hold community workshops during summer 2003 to start the budget consultation process on service levels and council tax for 2004/05. Arrangements for these now need to be put into place based on the financial forecasts set out in this report and asking the workshop to consider for example what should be done about supporting schools budgets in 2004/05. The workshop could for example look at the predicted council tax rise against current assumptions and the impact on services of increases above and below this limit.

2.4 The Council's traditional round of consultation meetings are held with business interests, council tax payers and residents associations, voluntary organisations and the workforce. Their views are reported to the Cabinet before it determines its recommendation on the budget and council tax levels in February each year.

2.5 Some concern has been expressed about the representative nature of both the business and council tax payer meetings. Despite contacting the umbrella organisations in Hampshire the business representatives have generally been small in number and the council tax payer representatives tend to represent two areas covering Hayling Island and Fleet and Crookham.

2.6 As well as the community workshops held in the summer it has therefore been suggested that wider consultation be undertaken in early September with a more representative business group, with the voluntary sector and possibly with council tax payers and residents associations. Similar ground could be covered to that in the community workshop. A session of perhaps half a day in early September with the voluntary sector and with business through the Hampshire economic partnership is suggested. In the case of the council tax payers it may be that a more structured Mori survey of council tax payers by age, socio-economic group, and geographical location will better enable the Council to get representative views on the balance between the increase in council tax and its effect on services. This could follow the work done during community workshops which would give some guidance on the forward budget strategy.

2.7 It has also been suggested that a way to embrace wider community involvement in the budget strategy would be to run a further workshop or session with representatives of all of the local strategic partnerships and again this could be timed for early September, building on the work done during the community workshops over the summer period.

2.8 It will also be important to consult fully with the Schools Forum at the same time about the prospects and outlook for the schools budget. Similarly other services will wish to carry out their normal consultation meetings with users and the workforce.

2.9 It is therefore suggested that a further report be bought to the Cabinet by the Chief Executive and the County Treasurer on the basis for a community workshop during the summer followed by separate meetings with the local strategic partnership, voluntary sector and Hampshire business interests during September. This could be complemented by a Mori poll of council tax payers in September and full consultation with the Schools Forum. The results of these consultations could then be used to inform the setting of the budget strategy for 2004/05. The budget strategy determined in September would then form the framework for discussions between the Leader and executive members and chief officers in identifying pressures, efficiency and other savings and additional demands on services for 2004/05, in advance of the settlement in December 2003.

Recommendations

That the Cabinet:

· consider the proposals for budget consultation during the summer as set out in paragraph 2.9 and receive a further report on the way forward.

Section 100 D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

Published works.

Documents which disclose exempt or confidential information as defined in the Act.

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