Archived decisions

AT A MEETING of the CABINET of HAMPSHIRE COUNTY COUNCIL held at The Castle, Winchester on Friday 6 February 2009

Chairman:

p Councillor T.K. Thornber, CBE

Councillors:

Also present with the agreement of the Chairman:

Councillors M.F. Cartwright; A.P. Collett; P.R. Edgar, K.Evans, Mrs J. Kelly and Mrs C.A. Leversha.

498. APOLOGIES FOR ABSENCE

There were no apologies for absence.

499. DECLARATIONS OF INTEREST

Members were mindful that where they believed they had a personal or prejudicial interest in any matter considered at the meeting declared that interest at the time of the relevant debate and, having regard to the circumstances described in paragraphs 9, 10, 11 and 12 of the County Council's Code of Conduct, considered whether to leave the meeting whilst the matter was discussed, save for exercising any right to speak in accordance with paragraph 12 of the code.

500. CONFIRMATION OF MINUTES

The minutes of the meeting held on 26 January 2009 were confirmed as a correct record, subject to a clarification to minute 495 in respect of the declaration of interest made by Councillor Adrian Collett (Oak Farm Community School, Farnborough - outcome of consultations on the proposal for closure). Councillor Collett asked that it be noted that his nephew lived within the Oak Farm Community school catchment area, rather than that he attended the school.

501. CHAIRMAN'S COMMUNICATIONS

(a) The Chairman welcomed Henry Watson to the meeting.

Mr Watson is a Home Office official and had been `shadowing' the Chief Executive as part of his career development.

502. REVENUE BUDGET AND PRECEPT 2009/10 AND PROVISIONAL BUDGET 2010/11 - 2011/12

The Cabinet considered the report of the County Treasurer (Item 5 in the Minute book) which proposed recommendations to the County Council on the 2009/10 budget and council tax, based on the budget guidelines approved on 22 December 2008. The proposals took account of the consideration of the guidelines by the relevant Executive Members, and the scrutiny arrangements through the Select Committees. The report also compared the variations in the proposed 2009/10 budget with the previously approved budget guidelines.

The Chairman asked the County Treasurer to expand upon the report, taking into account an amendment that he would wish to formally move later in the meeting. The County Treasurer then explained key elements of his report, which he supplemented with handouts. The County Treasurer also circulated an amended, proposed decision sheet reflecting the suggested amendment that had been referred to.

The County Treasurer explained that his report summarised

· 2008/09 underspendings on services and anticipated variations in other budgets;

· Spending pressures and savings for 2009/10;

· Cashable efficiency savings 2009/10;

· Workforce costs and numbers;

· Additional one-off resources available in 2009/10;

· Use of one-off resources from 2008/09 in 2009/10;

· Recurring savings in 2009/10;

· Use of continuing resources in 2009/10;

· Reductions in Council tax rise;

· Reserves at 31 March 2010;

· Service cash limits for 2009/10 and their planned cash increases for 2010/11 and 2011/12;

· The 2009/10 Precept and provisional council tax bill for 2009/10 and;

· Data that compared Hampshire with other County Councils.

The County Treasurer also reminded Cabinet that changes in economic activity and interest rates had had an unavoidable effect on the County Council's finances. The significant economic downturn had had a negative effect on capital receipts and unsupported borrowing had therefore had to be temporarily increased to cover a shortfall in the level of originally anticipated capital receipts. A reduction in net interest costs, in 2009/10 was, however, likely to be achieved following the recent reductions in interest rates, which would largely offset the effect of increased borrowing.

Savings, mainly from lower than budgeted increases in waste volumes and in negotiated efficiency savings achieved in the waste contract had released more resources of £6.1m. Of this sum £1.2m was proposed to improve the safeguarding arrangements for vulnerable children and £250,000 towards the final modernisation of Recreation & Heritage Services. The rest of the savings would further reduce the proposed council tax rise from 3% to 2.5%.

The County Treasurer explained that in light of the reduced economic activity being experienced, both at local and national levels, the amendment being put forward was based upon adoption of revised assumptions in respect of future pay awards and price rises. A reduction in the provision for future pay awards from 2.5% to 1.5% and in price rises from 2.5% to 2.25%, in both 2009/10 and 2010/11, meant that the proposed council tax rise in 2009/10 and the provisional council tax increase for 2010/11 could be limited to 1.9% (£19 on a Band D property in 2009/10).

Cabinet particularly welcomed the efforts made by County Council staff to seek savings through disciplined procurement practices and the renegotiation of contacts (where appropriate) such as that for waste disposal. Cabinet also acknowledged that the drive to reduce costs was ongoing and that service reviews and the proposals arising out of the Hampshire Workstyle initiative, particularly in respect of the rationalisation of premises, held out the prospect of further savings.

Given the County Council's importance to the local economy, Cabinet hoped that schools would seek to maintain only a realistic level of balances so that any excess funds that they controlled could be released for school improvements. Cabinet felt that this would be likely to enhance the quality of education that schools provided for their pupils, as well as providing valuable support to contractors in their locality.

The Cabinet expressed its continuing frustration at the low level of formula grant per head that Hampshire County received from central government (the lowest amongst all County Councils). Cabinet was also concerned that many Hampshire residents would find it extremely difficult to absorb a high level council tax rise. Given the potential impact of the economic recession on Hampshire residents and businesses, Cabinet therefore endorsed the proposed amendment to adopt lower assumptions for the level of pay awards and price inflation. This was felt to be both realistic and sustainable and it would also enable a lower level of council tax to be recommended.

Having accepted the amendment as described above, Cabinet adopted

revised recommendations for submission and approval by the County Council on 19 February 2009. A copy of the substantive decision record is attached to these minutes as Appendix 1.

503. CAPITAL PROGRAMME 2009/10 2011/12

The Cabinet considered the report of the County Treasurer (Item 6 in the Minute book) setting out the proposed capital programme for 2009/10 to 2011/12, based on the guidelines agreed by Cabinet on 22 December 2008 including support for capital schemes from the Government. The proposals took account of the County Council's capital strategy and the Prudential Code for Capital Finance in Local Authorities including the capital financing position, the level of debt outstanding and the consequences for the revenue budget and council tax.

The County Treasurer explained that a reduction in the forecast level of capital receipts, because of the downturn in the property market, would require the use of temporary prudential borrowing of £24.7m to meet the shortfall On current assumptions about the recovery of the property market and the flow of capital receipts, this temporary prudential borrowing for `bridging loans' would be fully repaid by 2013/14.

Cabinet acknowledged that the slowdown in economic activity meant that some of its plans might have to be deferred for a period of time but a substantial programme of works totalling £427m, over three years, was still being proposed. Significant savings were also expected to arise upon completion of the Ashburton Court redevelopment, following which a planned programme of disposals could be undertaken. A number of leases would also not need to be renewed. Cabinet also expressed its concern that major transport schemes and the Building Schools for the Future programme was subject to a competitive bidding process where there was no guarantee of success and no method to recover significant bid preparation costs.

Following a lengthy discussion, the Cabinet adopted the recommendations set out in the report. The decision record is attached to these Minutes as Appendix 2.

HAMPSHIRE COUNTY COUNCIL

Executive Decision Record:

1) Summary:

The following decisions were made, based upon the recommendations from the Leader and Cabinet to the County Council for the 2009/10 budget and council tax that:

1.1. the revised estimates 2008/09 (Appendix 1) be approved

1.2. the anticipated underspendings of £10.6m in Table 3 (paragraph 2.13) be carried forward to 2009/10 (£3.9m on Adult Services, £3.9m on Supporting People, £1.3m on Children's Services, £0.3m on Environment and £1.2m on Policy and Resources)

1.3. the additional pressures and growth proposals from Executive Members totalling £28.1m be approved (Table 5, paragraph 4.18 and Appendix 2)

1.4. the savings and redeployment proposals of £19.9m put forward by Executive Members, be approved (Table 5, paragraph 4.18 and Appendix 2)

1.5. cashable efficiency savings of £20.5m in 2009/10 (Table 6, paragraph 5.9 and Appendix 3) be approved

1.6. the annual review of charges and maximisation of income across services (Table 7, paragraph 6.2) be approved

1.7. the workforce implications of the proposed budget 2009/10 (Table 8, paragraph 7.3 and Appendix 5) be agreed

1.8. additional one-off growth of £6.1m be approved (Table 10, paragraph 8.20)

1.9. additional recurring growth of £1.5m be approved (Table 12, paragraph 8.36) including: £250,000 for Recreation and Heritage to meet all future initiatives and to complete the restructuring and modernisation of libraries; and £1.2m for Children's Services to make a substantial contribution to the reduction of risk in the practice of safeguarding children in Hampshire

1.10. adjustments to reserves as set out in Table 13, paragraph 10.14 and the overall level of reserves (Appendix 6) be approved

1.11. the estimated level of balances at 31 March 2009 of £29.0m (Table 14, paragraph 11.2) be approved, including £7.6m from use of underspends in 2007/08 and 2008/09 to reduce council tax in 2009/10 and 2010/11

1.12. the budget for 2009/10 as summarised in Tables 16 to 19, set out in detail in Appendix 4 and including the adjustments in recommendations 1.8 - 1.11, and the reduction in provision for future pay awards from 2.5% to 1.5% and in price rises from 2.5% to 2.25% in both 2009/10 and 2010/11 be approved

1.13. the provisional budgets for 2010/11 and 2011/12 summarised in Tables 22 to 25, together with provisional council tax rises of 1.9% in 2010/11 and 3.8% in 2011/12 be approved

1.14. the treasury management, annual investment strategies, prudential and financial health indicators for 2009/10, as set out in Appendix 8 be approved

1.15. it be a recommendation to Council that

a) the Treasurer's report under Section 25 of the Local Government Act 2003 be taken into account when the Council determines its budget and precept for 2009/10 (Appendix 9)

b) the revenue budget for 2009/10 (as set out in the attached draft budget book) and the provisional budgets for 2010/11 and 2011/12 be approved

c) the total budget requirement for the general expenses of the County Council for the year beginning 1 April 2009 be £657,009,000

d) the County Council's band D council tax for the year beginning 1 April 2009 be increased by 1.9% to be £1,018.17

e) the County Council's council tax for the year beginning 1 April 2009 for properties in each tax band be:

	£
Band A	678.78
Band B	791.91
Band C	905.04
Band D	1,018.17
Band E	1,244.43
Band F	1,470.69
Band G	1,696.95
Band H	2,036.34

f) precepts be issued totalling £509,698,895.42 on the billing authorities in Hampshire, requiring the payment, in such instalments and on such dates set by them and previously notified to the County Council, in proportion to the taxbase of each billing authority's area as determined by them and as set out below:

	£
Basingstoke and Deane Borough Council	62,657.70
East Hampshire District Council	47,514.78
Eastleigh Borough Council	43,666,14
Fareham Borough Council	42,383.00
Gosport Borough Council	27,670.70
Hart District Council	37,892.60
Havant Borough Council	42,674.00
New Forest District Council	72,350.90
Rushmoor Borough Council	31,184.03
Test Valley Borough Council	45,327.00
Winchester City Council	47,282.09

g) the annual investment strategy and policy for the level of minimum revenue provision (Appendix 8) be approved

h) the prudential and financial health indicators (annex 3 to Appendix 8) be approved.

2) Reasons for the decision:

2.1. The full County Council must agree the 2009/10 revenue budget and set the council tax for 2009/10 at its meeting on 19 February 2009. The Leader will present his budget speech and recommendations at that meeting. This report provides the background to those budget decisions and presents the recommendations from the Leader and Cabinet to the County Council.

2.2. The County Treasurer under Section 25 of the Local Government Act 2003 is also required to report to the full Council on the:

· robustness of the estimates for 2009/10

· adequacy of the financial reserves in the budget

2.3. These decisions support the corporate strategy by providing resources for:

a) Hampshire safer and more secure for all

b) maximising wellbeing

c) enhancing our quality of place

2.4. The budget is part of the integrated financial, performance and workforce planning process linked to the corporate strategy, and the corporate improvement plan. Resources have been allocated as the highest priority for maximising wellbeing towards meeting the needs of the most vulnerable in Adult Services and Children's Services, as well as supporting the capital programme.

3) Other options considered and rejected:

3.1. Other options are not available as far as process and timetable are concerned, but the leaders of the opposition parties may wish to present their own recommendations on the budget and council tax to the County Council as amendments to these proposals.

4) Conflicts of Interest:

4.1. Conflicts of interest declared by the Decision-Maker:

a) None

4.2. Conflicts of interest declared by other Executive members consulted:

a) None

5) Dispensation granted by the Standards Committee:

None

6) Any reasons for the matter being dealt with urgently:

None

HAMPSHIRE COUNTY COUNCIL

Executive Decision Record:

1. Summary:

1.1. The following decisions were made, based on the recommendations of the Leader and Cabinet to the County Council, for the capital programme for 2009/10 to 2011/12:

1 That the architectural enhancement pass-through costs at the Chineham, Marchwood and Portsmouth Energy Recovery Facilities be added to the Environment capital programme for 2008/09 at £19.330m, to be financed by £3.257m from the revenue budget for the waste management contract and £16.073m of prudential borrowing to be repaid from that revenue budget (paragraph 9.1)

2 That Children's Services capital resources totalling £11.047m be deferred from the 2008/09 capital programme to 2009/10 and 2010/11 (paragraph 8.2)

3 That it be a recommendation to Council that:

a) the capital programme for 2009/10 and the provisional programmes for 2010/11 and 2011/12 be approved as set out in Appendix 3 of the accompanying report and subject to the conditions set out in section B.3 of the County Council's Financial Procedures on the responsibilities for managing the capital programme and, where appropriate, to the approval of the Executive Member for Policy and Resources to proposals by executive members to retain more than a 25% share of capital receipts

b) expenditure on preliminary design and planning work for major transport schemes be permitted when they have achieved a place in the County Council's Local Transport Plan, subject to the cost being met within existing Government allocations

c) authority be given to incur expenditure on land purchases as follows:

(1) up to the sum specified in respect of sites still required for the schemes included in the capital programme for the period 2009/10 to 2011/12 provided that the relevant scheme has been the subject of a feasibility or design project appraisal approved by the relevant executive member

(2) up to the amount included in the programmes for 2009/10 to 2011/12 in respect of advance and advantageous land purchases.

2. Reasons for the decision:

2.1. The full County Council must agree the capital programme for 2009/10 to 2011/12 at its meeting on 21 February 2008. The Leader will present his budget speech and recommendations at that meeting, including proposals for the capital programme. This report provides the background to the capital programme and proposes the recommendations from the Leader and Cabinet to the County Council.

2.2. These decisions support all the County Council's corporate priorities as the capital programme provides financial resources for:

Hampshire safer and more secure for all

Maximising wellbeing

Enhancing our quality of place.

3. Conflicts of Interest:

3.1. Conflicts of interest declared by the Decision-Maker:

None

3.2. Conflicts of interest declared by other Executive members consulted:

None

4. Dispensation granted by the Standards Committee:

4.1. None

5. Any reasons for the matter being dealt with urgently:

5.1. None

6. Statement from the Decision Maker:

6.1. None