Councillor Wells, Leader of
Council made a presentation in response to a question raised by the
Panel. In his presentation Councillor Wells made the following
points:
- Council had put in
place a medium term financial strategy (MTFS) that reflected that
there would not be a merger of the East
Kent authorities;
- This was based on a
four year government financial settlement;
- The financial
strategy was aimed at making the required immediate and medium term
savings;
- The merger would have
made efficiency savings of about £5-7million per year across
the four participating councils;
- There would have been
one-off £10million transaction costs to facilitate the
changes;
- The 2017/21 council
MTFS was produced on the basis of there being no merger of the four
East Kent Councils;
- The 2018/22 was being
prepared as per current arrangement (i.e TDC working on its own to
identify revenue sources to build the budget);
- There were still
significant budgetary challenges;
- There were also some
uncertainties relating to the local government support grants
leading up to 2020 where there would be no revenue support grant
for councils;
- There was no Local
Government Finance Bill in this year’s Queen
Speech;
- Government funding
was reducing every year and business rates may fill-in the budget
gaps but there is no firm decision on that issue as there some
pilot schemes still being tested;
- In 2012/13 TDC had
just over £21million in the budget compared to
£19million in 2016/17 and £16.7million in
2017/18;
- The Council received
revenue support grant in 2012/13 of £9.6million and by 2021,
Council would need to have in place a self-financing budget (i.e
all £16.5million) as the Council would receive no revenue
support grant
- The Council had
received notice of changes to the structure of the New Homes Bonus
six weeks’ prior to the Council’s budget meeting, which
has resulted in a shortfall of
£1million;
- Council made some bad
decisions in the past;
- The Peer review gave
credit to TDC for operating council affairs in business like
way;
- The Council was
exploring a number of options to create savings, including sharing
offices with external agencies like is the current situation with
Thanet CCG;
- Shire and District
Councils had been the worst hit by a decrease in government revenue
support grants.
In response to the presentation
Members raised the following points and questions:
- Was there any
opportunity for merging with other agencies as was suggested in a
previous approach called ‘Common Places/Total Place
concept’?
- There was a urgency
for TDC and other local councils in the area to make savings in
short to medium term to reduce overheads and work with sustainable
council budgets;
- Parish/Town Councils
would lose about 33% per year as a result of the reduced government
spending;
- What were the plans
for raising the £16.5million in 2021?
- Would it be correct
to suggest that the Council may be forced to reduce some of the
services it currently provides?
- A Conference in
Birmingham looked at a paper on Enterprising Councils, it was
interesting to note that Sevenoaks District Council had developed a
successful business using its New Homes Bonus funding;
- Had Council
considered using the various experiences and skills that some of
the current councillors have got in assisting with identifying
sources for raising income?
- Business rates were
quite high for some businesses in the high street in Margate. Could
these be reviewed downwards?
In responses to Panel
observations and questions Councillor Wells, Madeline Homer, CEx
and Tim Willis, Director of Corporate Resources said the
following:
- Council currently had
an office share arrangement with Thanet CCG and Council would be
prepared to explore similar arrangements with other external
agencies;
- Council was currently
working with other public bodies around sharing assets and working
collaboratively under the title ‘Thanet Leadership
Group’ that sought to work strategically in delivering
services in a cost effective way as ‘Strategic
Enablers;’
- A significant amount
of cost savings due from the merger were to be found in sharing
management costs. Council had by law to come up with a balanced
budget;
- Small Members
Briefings would be used to share some thoughts with all councillors
and get suggestion from Members;
- Cabinet would be
sharing thoughts during the budgeting process for
2018/19;
- Addressing future
financial challenges would also consider outsourcing non-core
services (for example the revenue and benefits being considered for
outsourcing to CIVICA by East Kent Services);
- Council ought to be
cautious when considering income generating projects, as including
such projections in the MTFS could lead to future problems if the
projects did not yield the anticipated income;
- TDC was in the
process of creating a Business Transformation Manager role to drive
through ideas for income generation for the Council;
- Council will continue
to invest in capital projects to reduce council costs;
- Council issue out a
skills audit that would be used to engage Members in activities for
identifying viable income generating projects that TDC could
explore;
- Democratic Services
would be issuing a skills audit for members, in which they could
identify additional skills members had that could assist the
Council.
- Council could reduce
business rates, but the biggest challenge would be to come up with
criteria for such a scheme. There would also be a need to address
the question ‘why introduce such a scheme in Margate and not
in other areas in the district.’
The Chairman thanked the Leader
for the presentation and the Panel noted the report.