Cornwall Council sets its budget and Council Tax for 2016/17

Today, Cornwall Council has set its budget and Council Tax for the 2016/17 period. This function has to be carried out yearly. This budget, like previous years is going to be painful due to the Governments cuts to the Council’s grant.

The recent Government’s Spending Review in a last-minute and unplanned for move, took a further £6m away from the Council’s grant. This is on top of the previous cuts. In a rapid rethink, the Government realised the slight-of-hand settlement by moving funding from rural to urban authority was going to impact on many rural authorities, including many Tory shire-lands. So they changed it. I would say this was good news for Cornwall, but even with the last-minute bribes changes, Cornwall is still £1.4m worse off than previously planned.

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Your Council Tax is made up of three elements. Cornwall Council, Devon and Cornwall Police and Crime Commissioner and town and parish council’s.

The Council Tax charge for a Band D property in 2015/16 was £1,293.92. This is set to rise in the 2016/17 period to £1,345.29. This is a 3.97% increase; or a rise of £51.37 per year, £4.20 per month. However, 2% of the 3.97% rise has to be spent on Adult Social Care.

I do take issue with the Government’s plan to allow council’s to precept 2% for Adult Social Care. The truth be told is the Government should fund this. It should not be down to local postcode taxation to raise the much-needed funding for this sector. Furthermore, Children’s Services also is part of social care, yet in the current rules, all the social care precept has to be sent on Adult Social Care.

The Police part of the precept is currently set at £169.47 per year. This will rise by 1.99% to £177.84 for 2016/17. In pounds, shillings and pence, this is a rise £8.37 per year, or 69p per month.

The third part of the Council Tax bill is the town and parish councils. Each town and parish council sets its own level of precept. However, the average rise in this precept is 17.93% from £86.18 to £101.63.

For Porthleven, the town council’s precept including the other two elements is:

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Yes, the town council precept will rise by £1.30 per year. The £60.90 pays for many things in Porthleven, including the two toilets, grass cutting, maintenance of certain areas including the play parks and many other services.

For Helston Town Council, the precept is currently £303,690 per year. This will rise by 10.8% to £336,580 for the period of 2016/17. This means the town council element of the Council Tax in a Band D property in 2015/16 from £91.87 to £100.69, rise 9.6%. A £8.82 rise, or 73p per month.

Whilst this Cornwall Council budget is going to be hard-hitting, there is some good news for the Children’s Services budget. In the budget period till 2019/20, there was around £9m in un-allocated savings that was yet to be found in the service area. With the approval of the budget today, these un-allocated savings will now not have to be found. Phew. As if these savings were required, it would have far-reaching and devastating impact on Children’s Services in Cornwall.

In a comedy moment of the day, the amendment to the main budget put forward by councillors Bob Edgerton and Lisa Dolley was resoundingly defeated with only Bob voting in favour of the amendment. His seconder had left the room during the vote…

The overall vote for the budget was in 67 favour, 13 against and 21 abstaining.

Those 67 who voted in favour of the budget, did this so with regret and difficulty because of the over all impact of the cuts. However, a budget must be set.

Council sets a very difficult budget

Today, Councillors of Cornwall Council set a four-year budget. It is a difficult budget and no-one would like to have to set this budget. This budget will result in reductions of services and job losses. However, were the Council can, we have protected services to the most vulnerable and highways.  I like many other people in local government never got into this game to have to do these horrible cuts.

Since the formation of Cornwall Council, the Council has had endless budget reductions. Of course, the Council cannot just blame someone else. It had to look at itself to make sure services are as streamlined as possible. I believe the Council has done this. You only got to look at the number of staff reductions and service harmonisation to realise the Council has (and continues) to make sure services are delivered in the best possible way. However, even with the Council examining itself, these latest reductions are firmly due to the draconian cuts to funding imposed by the Government.

During the six-hour debate with four amendments to the budget, Councillors gave their views on the merits of the budget and how their political party knows best. Once you take out the political posturing, Members raised the point why the cuts have had to happen. I also do not believe utopia will be found post the General Election in 2015. It has been made clear by various political parties there will not be a sudden rush of ‘new’ money post this election. From my experience, it is never new money, it is recycled money and something somewhere else has to stop to pay for the ‘new’ money.

The Cabinet and now today the Council have set a budget that will hopefully give some stability to deliver the services people require. This budget will not be easy to deliver, and it will be down to the dedication of the staff to deliver. They will be asked to deliver this budget with fewer resources.  I wish we did not have to set a budget like this, but there is little choice. As you cannot lose one-third of your budget and still be able to deliver the same level of service. The delivery of service is made more difficult because they is also an increased demand on those services.

At the end of the emotive debate, Councillors voted in favour of the budget by 69 for, 21 against and 19 abstention.

Should Cornwall Council raise Council Tax above 2%?

The Cabinet and the wider membership of the Council are currently in the process of deciding the budget for 2015/16 and up to 2018. I have said before, this budget is going to be very difficult. As having to find savings of £196m or losing one take one-third of your budget will mean services will be affected.

Setting the budget is made more difficult by the government imposing a 2% cap on the maximum a primary local authority can raise Council Tax. I have never been supportive of an ad-hoc raise, as any raise has to be justified, but when you are faced with such draconian cuts in the face of increased demand, it would be helpful if a Council had the ability to raise income that helps supports services.

The Government talks of devolution and handing powers down to Councils, but when it comes to setting a budget the Government hog-ties a local authority on setting its budget. It should not be up to Westminster in settling the a Council Tax figure, but the local authority.

The current legislation is if a local authority wants to go above the 2% cap, then it needs to hold a public referendum. 

One of the issues of holding a referendum is the sheer costs of running one. In Cornwall’s case we would not get much change out of £1.2m if Cornwall Council held a stand-alone referendum. Raising Council Tax by 1% would bring in an income of roughly £2.2m. So going 1% above would not really stop so many of the service reductions. If you want to help mitigate the impact of the reduced funding, the Council would need to look at a larger increase. For arguments sake, a 6% rise would net you £9.086m.

Even if the local authority wanted to raise it above the 2% it would have to convince the public to agree and vote yes. If you held a stand-alone referendum and lost, you would have to find additional savings to cover the cost of the referendum.

I will point out that if you want to stop the full impact of the £196m a few percentages added on is not going to have much impact. You will need to look at percentages above 25%/30%.

However, a stand-alone election might not have to happen, as the referendum could also take place at the same time as the general election. If this referendum took place at the same time as the general election you would still be looking at a running cost of around £700k.

A further difficulty in holding the referendum is this vote would be after Council Tax bills have gone out. So if a referendum was carried, there would be a need to re-sent Council Tax bills with the new Council Tax figure.

The question is, should the Council look into rasing Council Tax about the cap of 2%.

Councillors will hopefully be able to discuss this at full council, but what do the people of Cornwall think? Feel free to send me your views on this? I have added a poll, please give you views there too.

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Cornwall Council’s Cabinet decides its budget for the next four-years

The November meeting of Cornwall Council’s Cabinet met to discuss the Council’s budget for not only next year, but for the next four years too. As I have said before, you cannot lose one-third of the Council’s budget – £196m – and it not affect services. The budget for the next four-years has taken around 5 months to put together and has been a very difficult task due to the sheer scale of having to deal with such a huge reduction.

Before I go on let’s be clear on the reason Cornwall Council – like so many other council’s across the land – are having to set budgets like we are is because of the brutality of the Government’s cuts to council funding. As I said before, how would you deal with having to lose one-third of you household or business income?

It has been a very difficult task with a lot of difficult choices, some too difficult and have not been included. No-one in the Cabinet or the Directors wants to set this difficult budget. But we have to. As to delay or not tackle the issue of less money will result in more money having to be found later. That would result in more service cuts. Even though the Cabinet had to find massive savings, we still wanted to protect certain areas. These areas are services to the vulnerable, roads and the bus network. Even though these areas have been protected, they have not escaped reductions or cuts.

The Cabinet have put together this budget, but all councillors have had the ability to give their views on the budget by means of the PAC process, or put in simpler terms a series of committee meetings. The public too have had their chance to have a say by a series of public consultations. The report on the budget and the business plan is available HERE.

During yesterday’s debate, each Cabinet Member talked about their individual portfolios and the impact this budget will have on their portfolio. Children’s Services will have a 23% reduction in cash terms. This will result in a whole host of reductions or changes to how services are provided. It is hard to list them all in this blog post, but clicking on this LINK and scrolling down to CSF will show you the impact this budget will have on Children’s Services.

After each Cabinet Member had their say, it was the turn of the backbenchers to give their views. These views ranged from against the budget to what choice do we have and but support.  After those who wanted to say something did,  a vote was taken by the Cabinet who unanimously approved the budget. This is not the end of the process, as even though the Cabinet approved the budget, it is the full membership of the Council who have the final say. This debate will take place on the 25th November. It is only at this meeting and vote will we know if we have a four-year budget.

The reality of Cornwall Council’s Budget for 2015

It is no secret Cornwall Council is facing a large hole in its funding due to the reduction in funding from Government, increase demand and little scope to raise revenue via taxation. In total, the Council has to find roughly £196m in savings. Out of this total, around £40m has already been factored in from previous budget savings, which leaves £156m to find. To put it perspective that if you run a business or a household, the savings you need to make would be equal to one-third of your household / business income. Just think for a moment if you had to do this.

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With such a large savings target to find and on top of the £170m savings found between 2010/14, the way Cornwall Council operates and delivers services will change. The previous savings in 2010/14 protected frontline services with little impact. However, this time frontline services will not escape and will be affected by the budget reductions. No-one wants to do this, but there is little choice open to the Council. We have  sought to protect services that we feel important. These include services to the most vulnerable, transport and roads. Even though these areas are protected, they will still see some reduction.

The draft  budget proposals included corporate savings and efficiencies of £64m (41%) this will include jobs and buildings. The Council has already heavily reduced it office space over the last four years from over 180 buildings to around 80, and the plan is to reduce this again by roughly half. The painful bit will see roughly £52m (33%) taken out of front line services. A further £27m (18%) will come from income and commercialisation of services. However, a sting in the tail is £13m in savings still needs to be found for the budget to add up. This is made up of areas not yet identified and the Council not receiving as much income from the Better Care Fund.

The draft budget has factored in a 1.97% Council Tax rise. This will equate to a 48p per week rise on a Band D property. Cornwall Council (or any other primary LA) cannot raise Council Tax above 2% (not even a inflationary rise) without the need of a public referendum. To hold a referendum it would cost the Council roughly £1m. This figure is based on the vote being a single vote and not held at the same time as another election.

Lets say a referendum was held and a raise was supported. A 6% raise would bring in an extra £9.068m. Now this would still mean there would be a reduction in services, but these reductions could be a lot less painful if more funding would come in. There is a feeling within the Council that a referendum could be held at the same time as next years general election. This would make the referendum a lot cheaper. The downside to this would mean most if not all of the political parties would campaign against this. Though in my view, we should still ask the question of should we raise Council Tax higher than 2%. Whether a Council Tax referendum is held or not will be up to the Councillors who would vote on holding a referendum or not, and this vote has yet to take place.

As this is a draft budget and nothing will be voted upon till November, the Cabinet and the Council are holding a series of public events to hear what the public think of the proposals and give their views on any other area which could be taken into account. If you want to attend one of these events, click HERE to find the nearest event to you. For Porthleven, Helston and the Lizard, this meeting will take place on Tuesday 28th October at Helston Community College, starting at 6pm.

It is your time to give your view. You can give you view by completing this online form HERE and the draft budget documentation is HERE

 

Cornwall Council’s Budget and £196 million to save

For the last few months, the Cabinet have been working on draft proposals for the 2015 till 2018/19 budget. The message has been clear from the Council in that it will have to find a huge amount of savings. The eye-watering amount of £196m will have to be found from the Council’s budget in the next four-years. This is on top of the £170m previously saved. I have said it before, and I will say it again, services provided by the Council will change, and in some cases stop.

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A £196m is an awful lot of money to have to save, and a lot of work has already been done to reach this target. Some of the saving to date have been achieved by a new agreement with staff on pay and a large-scale restructuring of senior management. Even with these and other saving already taken into account, the Council still has to find a further £156m. The reason for the saving lays firmly at the feet of the Government. As they have cut the grants to the Council to the tune of £89m in cash terms. When you add in inflation, demographic changes and demand, you get the final saving figure.

However, the Council would not be in such a difficult position if the Government treated Cornwall the same as the average urban council. If Cornwall Council was treated equally, then the Council would receive and extra £48m per year. It still would require savings, but not at the level the Council is now facing.

In the past budget reduction have been delivered pro-rata across the directorates. This method of ‘salami slicing’ cannot continue as we cannot afford to cut equal chunks off every service.  This time the Cabinet with information and intelligence gathered have produced a set of priorities for this budget. These areas were seen an important and have been protected from the worst areas of cuts.

The priorities are:

  • Services to the most vulnerable in society
  • the public transport budget
  • road repairs and maintenance

Of course some of the proposals contained within the budget will not be popular. This is why since the launch of the draft budget yesterday, the Cabinet and the Council wants to hear your views and suggestions. The message is clear, we are listening.  There will be a series of 20 public events held for the public to give their views. You can even give your views via an online form HERE. This budget will also go through the full democratic process and nothing will be decided until the budget is debated and voted on in November.  Of course before you give your views and suggestions, you will want to read the draft budget. This can be found HERE.

In a break from ‘tradition’ all draft budget papers are public, there are no ‘pink papers’ (restricted) as everything is out in the open for the public, staff, and media to see. This is important, as this Cabinet has always prided itself on being open and transparent in its business and by putting all the documentation out in the public arena will also show the difficult task ahead.

It is now your turn to give your views….