Three year grant settlements and budgets

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Three year grant settlements and budgets

• David Smith
• Director of Finance and IT
• Wigan MBC
• Treasurer
• Greater Manchester Fire and Rescue Authority

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• Three Year settlements
• revenue
• capital
• Three Year budgeting - example of Wigan MBC and
  Greater Manchester Fire and Rescue Authority

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Three year settlements

• Promised in the CSR in July 2004
• Started in 1998 for central departments
• Roll out to NHS, LSC, and RDAs
• Scotland

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Control totals and changes of function

• Difficulties for Departments
• policy changes?
• better discipline?
• Five year strategies
• Pragmatic?
• Interaction with CSR

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Announcements so far

• 186 responses to consultation - broad support
• 19th July 2005
• first two years 2006/7 and 2007/8
• from 2008/9 align with CSR

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Formulae and Data

• 2006/7 changes
• projection of population and council tax base
• presumption against amendment
• Floors and ceilings in advance?

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Capital allocations

• Value of certainty
• Large regional schemes
• Bid based regimes
• Emergencies / cost increases / gt100k
• Grant rather than borrowing?
• PFI - outside of the process

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HRA subsidy

• Formula for 2006/7 to remain in 2007/8
• Stock and other data updated by base data return

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Specific and targeted grants

• Generally be allocated on a three year basis but
• Performance
• Expenditure based
• Bidding

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Council Tax and Capping

• Indicative Council Tax levels
• individual lines or whole bill?
• Firm or indicative
• change in administration
• Capping rules in advance?
• Promise of further discussion

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Legislation

• Could be done without primary legislation but
• Capping
• RSG

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Spending priorities

• fundamental savings review of departmental
  spending Summer 2006
• CSR 2007 - 2008/9 2009/10 2010/1
• Meeting future priorities - Education? Nuclear
  Power? State pension?

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Lyons - part 2

• 180 degree turn?
• function and finance but not structure?
• Local Area Agreements ?
• Difficult case to make for change?
• New approach

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Gershon part 2

• Targets on track
• But are they the right savings?
• The first round has been pretty minor, although
  the sums of money are impressive... In other
  words councils need to change the culture from
  one of looking to improve the status quo to one
  of radically rethinking the whole approach Phil
  Woolas Sept 15th
• Interaction with CSR and Tax
• If we are to make any case for changes in local
  taxation, we must bear down- and be seen to be
  bearing down- strongly on costs and demonstrate
  that local government is as efficient- if not
  more efficient- than the best, not just of the
  public sector but the private sector as well.

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White Paper

• 2006 - a new and ambitious blueprint
• Devolution of Power?
• Monitoring and control
• Guardian, Guarantor and Champion

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Three Year Budgets - Wigan MBC

• Started in 2000
• Annual publication
• Council as a whole
• Link with Community Plan and Vision

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• Inflation, increments, income
• Capital charges
• Provision for major schemes
• Grant fallout

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Looking back

• Grant settlement
• Spending forecast - growth pressures
• Council Tax closest to predicted

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Aims

• Balanced budget - no use of reserves for revenue
  or capital
• Investment in IT and Repairs and Maintenance
• Strengthen links with Corporate priorities

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Three year settlements should..

• Allow us to set longer term efficiency targets
• Invest to save
• parking enforcement
• car park improvements
• Move to a more detailed level of forecast
• Manage tensions

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Three Year Budgets - Greater Manchester Fire and
Rescue Authority

• Linked with Integrated Resource Management Plan
• Key variable - pay
• Shift in emphasis - prevention
• Modernisation

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• Project planning
• rostering for duty
• special appliances
• Pensions - no fund - ODPM proposals
• FSS shifts
• Grant floor

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• Council Tax precept
• Plan use of reserves and balances
• Relations with the workforce

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Summary

• 2006/7 and 2007/8 first two years
• Lyons - functions, finance and accountability
• CSR 2007 - 2008/9, 2009/10 and 2010/11