Statement by the Leader on the Bournemouth Council Budget

Statement by the Leader on the Bournemouth Council Budget

 

I am pleased to propose the 2013/14 Budget to the Council.

For the third year running there will be no increase in Council Tax bills, despite increases in the precepts levied by both the Police & Crime Commissioner and the Fire Authority of 1.95% and 8.2% respectively. This has been made possible by our proposal to reduce the Council’s share of the bill for Council Tax by 0.7%.This will be a support to many working people during these difficult times as well as to many retired people who are struggling on a pension. We are in a position to take the government’s Council Tax Freeze Grant again this year despite the cumulative impact this will have on the base Budget in future years. This will amount to lost funding totalling £4.8million in the Council’s base Budget position from 2014/15 onwards.

 

 

 

In addition to frozen Council Tax, the other good news for the residents of Bournemouth is that despite the severe austerity measures being taken by the Government and many other councils up and down the country, it will not be necessary to consider cutting front line services. This is particularly welcome in the present economic climate where the elderly, the vulnerable and struggling families need support from the Council as never before.

The message is clear – once again, we don’t need to cut services next year and we don’t plan to cut services in future years.

We have worked hard to ensure that Bournemouth Council is in a relatively strong financial position. Due to careful financial planning and despite receiving much less government grant funding we have been able to balance our budgets. In turn, our financial success as a Council supports residents and the local economy of Bournemouth. This has been achieved despite the substantial year on year cuts made in our core revenue grant since 2010/11, a further reduction of almost £8million (11.6%) in 2013/14 and another £5.58million (9.2%) proposed for 2014/15. That amounts to nearly £30million removed from Bournemouth’s income in a few short years, a total loss of 35.1% overall – far more of course, than the 28% originally promised by Government in setting out its Comprehensive Spending Review plans in 2010 .

Yet many councils face a far greater financial plight arising from government grant cuts. So much so that some are increasing Council Tax to almost the 2% ceiling allowed by the government and refusing the government’s freeze grant because they will not be able to balance their budgets once these time-limited support grants run out in future years.

Bournemouth is not in the same position due to the Financial Strategy we have been following since 2007 to ensure long-term budget sustainability.

 

 

 

 

 

In 2007 the Council embarked on a programme of efficiencies founded on:

  • achieving financial and Budget stability through prudent and rigorous financial management and control;
  • driving out sustainable savings and efficiencies by thoroughly reviewing the costs and effectiveness of all services;
  • reducing waste, bureaucracy and red tape wherever we find it

This work has led to savings of over £35 million since 2007 with a further £36.5 million scheduled over the next three years. I am delighted to say that this means we are now well on track to achieve at least £326million in savings and efficiencies by 2020/21 as planned. This has ensured that the Council is able to sustain the current level and quality of the services it provides for all residents. It has also allowed us to prudently build general reserves and balances over time allowing the Council to manage over the medium term and remain confident in its ability to successfully deliver an ambitious agenda for the Town, despite these troubled financial times.

Thanks largely to this ongoing work, we will continue to invest in areas that are important to residents, such as tackling anti-social behaviour, cleaning up our streets and neighbourhoods, improving roads and pavements and supporting jobs in the local economy. 

Having built a strong foundation, we are now able to bring forward the second phase in our Financial Strategy and buck the national trend to:

  • continue to safeguard priority services without increasing costs to local Council taxpayers for the foreseeable future. The only exception to this is where services have been provided below cost and significantly below the charges made by other Councils to people who can afford to pay enough to cover the cost of the service.  Most service users will be unaffected ;
  • secure the early delivery of the Council’s strategic housing ambitions;
  • facilitate growth and investment in the Town to support economic development and re-generation;
  • drive forward the Council’s commitment to improving the quality of life in the most deprived areas in Bournemouth in Boscombe and West Howe over a shorter time-scale than previously planned;
  • ensure further organisational change,  driving out further savings and efficiencies wherever possible;

 

  • gain the best overall value for money and added value possible from the Council’s existing partnerships with BH Live, Bournemouth 2026, the Bournemouth Development Company and Mouchel.

This is an exciting and ambitious plan for economic growth and substantial inward investment to deliver our housing and re-generation plans for the Town. It clearly demonstrates our understanding of the hugely positive role that can and should be played by local councils in driving recovery and shaping community re-generation in the absence of private sector growth and expansion in these very difficult economic times. The need for councils to act in this way to support economic recovery fully reflects the Government’s agenda. The government and other key agencies have repeatedly demonstrated their confidence in the ability of this Council to deliver, investing more than £44million over the past year alone in important new schemes such as Waste, Better Buses, Transport and Tourism

We have been successful in achieving the latest stage our City Deal Bid and as a result the sub-region will see major investment in the development of the airport and the port over the next few years. In bringing forward the Budget for 2013/14, we have committed £15million to support the development of our Community Financing Initiative over the next few years to provide accessible mortgages for first time buyers and loans to small businesses and local entrepreneurs who need help to get started but can’t access the finance they need from the private banking sector at this time. This initiative will help to create much needed movement in the housing market to the benefit of all our residents and the local economy as a whole. It will also allow us to make a real difference in how we are able to support young people leaving our schools and universities who want to live and work in Bournemouth, and add to the economic vibrancy and well being of the Town in future years.

 

In addition, we plan to bring forward a new strategic public/private partnership in 2013/14 that will deliver substantial inward investment in the Town over the next five to ten years.  We are currently in discussion with potential partners and expect to report proposals for Cabinet consideration before the summer.  These initiatives, along with others planned in 2013/14 will provide alternative funding streams for the Council, helping it to become more self sufficient financially, reducing its exposure to future government funding cuts and easing the burden for local council tax payers.

This Budget also makes substantial provision again for the most vulnerable in our community. Over the last two years we have provided more than £8million extra for Children’s and Adults’ Services over and above the base Budget.  A further £6million will be allocated for these services in 2013/14 – this means that over 60% of the Council’s entire Budget next year will be used to meet the costs of these statutory, demand led services. These are very necessary, but costly services, which the Council must shoulder in the absence of any national funding solutions to the burgeoning Adult Social Care problems we face as a country, and in particular here in Bournemouth.

 

In addition, we recognise that Welfare Reform, Universal Credit and the imposition of the Government’s Local Council Tax Reduction Scheme may cause hardship for some. Although there is no direct requirement by government for the Council to do so, we have set aside £1million to establish a Local Welfare Assistance Fund to provide targeted relief in 2013/14 as needed. We have also created a new earmarked reserve of just over £500k to provide additional resources to help the vulnerable with potential hardship, particularly in the areas of housing and homelessness, that might follow from the change-over to the system of Universal Credit should that prove necessary. We will work closely with third sector providers such as our local Credit Unions, to provide practical support and advice to those who are struggling the most with these changes imposed by the government

There remain many uncertainties ahead, but Bournemouth is well placed to address them. The transfer of Public Health duties to local government from 1 April 2013, growing numbers of older people and the care they need are a real and expensive concern here in Bournemouth. The numbers of children being taken into care has now stabilised at around 250 but high unit costs can mean that even a slight increase in numbers can cause significant financial pressures in the system.

We know that public finances will remain under extreme pressure for the foreseeable future and that the Council can expect further cuts in funding next year as a result. Our current forecast for the next three years anticipates a cumulative resourcing gap of £20million by the end of 2015/16 as things stand. However, we need not be daunted by the challenge this represents. The Council has a proven track record of managing through adversity and balancing its financial position year on year. This year we have achieved even more and have been able to make a small but important financial contribution back to the taxpayer which will be welcome to all those struggling to make ends meet in these difficult time

The Budget I am presenting to the Council today is financially sound, protects front line services, supports those residents most in need in our community - the elderly, the vulnerable and children here in Bournemouth - and recognises the financial strain affecting many families in these difficult times. By introducing the next phase in our Financial Strategy, we are now able to go further and create the potential for real, sustainable and substantial growth in the Town to the benefit of all our residents in future years.

 

I commend this Budget to the Council.

Cllr John Beesley

 

Leader

Bournemouth Council 

26 February 2012

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