Agenda item

To consider the report of Cabinet seeking approval of recommendations in regard to the Medium Term Financial Strategy and Transformation to 2019 savings proposals.

The Council considered a report from the Cabinet (Item 10 in the Minute Book) providing an update on the medium term financial strategy for the County and Transformation to 2019 savings proposals and detailed Equality Impact Assessments, considered by the Cabinet on 16 October 2017. The Cabinet report outlines the feedback from the consultation exercise ‘Serving Hampshire – Balancing the Budget’. The Cabinet had also considered the Treasury Management mid-year monitoring report for 2017/18 (Appendix 2 to the Cabinet report) in accordance with the CIPFA Code of Practice and recommended it to the County Council for approval.

In presenting the report, the Leader confirmed that it dealt with some difficult recommendations as a result of reductions in government Grant coupled with inflationary and demographic pressures which required savings of £140m 2019/20; a figure that was reported to Council in February last year.  The Leader confirmed that the County Council remains in a stable financial state having successfully delivered a previous round of savings for Transformation to 2017, whilst retaining high quality essential services. By adopting a long term approach, taking difficult decisions in consultation and using the County Council’s carefully managed reserves in a way that minimises the impact of changes had proved to be a successful approach and one that would be continued.  The Leader emphasised that by law, the County Council must set a balanced budget.

The Leader drew attention to the significant contribution that the various forms of commercial activity makes to the County Council’s financial resilience, and asked Members to note the almost £20m extra for Children’s Services to address demand pressures, social worker attraction and retention, home to school transport and special guardianship orders.  Recommendation (xi) from the Cabinet was highlighted which provided £500,000 support to Town and Parish Councils to provide pump priming funding for targeted, joint initiatives aimed at improving local services.

The Leader also drew Members attention to the additional resolution of  Cabinet (xii) as follows:

“Require that officers, as specific decision making processes move forward, continue to explore all viable options to revise or refine these proposals with particular regard to service continuity  in areas such as community transport, school crossing patrols and waste and recycling centres, in consultation with partners and stakeholders as appropriate, while recognising that any modification to the proposal must be consistent with the financial and time imperatives of the overall programme.”

The Leader moved the report’s recommendations and proposed an additional recommendation, which was seconded by Councillor Mel Kendal as follows:

“That Hampshire County Council calls on the Government to permit Councils responsible for administering the national Concessionary Travel Scheme, to levy modest charges on older persons’ passes, e.g. 50p for each use and £10 for issuing and renewing permits, with the balance of revenue raised after costs to be used to support uncommercial, public or community transport services serving vulnerable or disadvantaged residents or areas.”

The Executive Member for Economic Development highlighted a number of areas in the Cabinet report such as:

·         £14million for building smaller homes for children with complex needs with a further five houses on stream and more to follow; approval to transfer £3million from capital to revenue between the County Council and Enterprise M3 LEP to achieve greater flexibility in delivering economic growth across Hampshire

·         work on joint ventures that yield additional income or generate a return either through the County Council’s land holdings or through relationships with partners and contractors, e.g. Manydown development

·         addition to the Capital Programme of schemes associated with the development of Woodhouse Lane in Botley to facilitate Phase 1 of the Botley By-pass, a new secondary school and other infrastructure and utility works which will assist with Local Plan requirements

The Executive Member for Economic Development concluded that further work would be carried out in line with Cabinet’s resolution (xii), as detailed above.

The full opening debate speeches of the Leader and the Executive Member for Economic Development are available to view on the website.

Opposition Group Leaders responded to the proposals.  Councillor Keith House, seconded by Councillor Adrian Collett proposed an Amendment to Recommendation (d), as set out in the Council report, as follows and requested that the vote on the Amendment be a recorded vote and if that was lost, that recommendation (d) be voted on separately:

“Revise recommendation d) from

d) The savings proposals in Appendix 3, subject to further consultation and executive decision making where necessary.

to

d) The savings proposals in Appendix 3, be referred back to Cabinet for further discussion to evolve new proposals that

(i) give more protection to frontline services,

(ii) protect vulnerable residents rather than see these communities subject of the harshest cuts

(iii) develop a more coherent long-term investment strategy to generate income,

(iv) genuinely work in partnership with the rest of the public sector rather than cost-shunt to the NHS, police, local councils, and even within the County Council

(v) work with other councils and more effectively lobby government and Hampshire’s MPs to protect rather than destroy local services.”

No other amendments were proposed.

During the course of a full debate, views in support of, or raising concern,  about the proposals were expressed. 

The Liberal Democrat Amendment, as above, was put to the vote and the outcome recorded as follows:

FOR                21

Councillors: Chegwyn, Clarke, Collett, Mark Cooper, Craig, Dowden, Frankum, Harrison, Hiscock, House, Irish, Gavin, Kyrle, Porter, Price, Simpson, Tennent, Thornton, Tod, Wade and Westbrook.

AGAINST       49

Councillors: Bennison, Boiles, Bolton, Branson, Briggs, Brooks, Carew, Carpenter, Carter, Chadd, Rod Cooper, Dibbs, Edgar, Evans, Fairhurst, Forster, Gibson, Glen, Grajewski, Harvey, Hayre, Heron, Hughes, Humby, Huxstep, Joy, Keast, Kemp-Gee, Kendal, Latham, Locke, Mans, McEvoy, McNair Scott, Mellor, Mocatta, Oppenheimer, Perry, Quantrill, Reid, Stallard, Still, Taylor, Thacker, Thierry, Vaughan, Warwick, White and Withers.

ABSTAIN         1

Councillor Burgess

The Liberal Democrat Amendment was therefore lost.

Recommendation (d) of the Council report was put to the vote and recorded as follows:

FOR:               47

Councillors: Boiles, Bolton, Branson, Briggs, Brooks, Carpenter, Carter, Chadd, Rod Cooper, Dibbs, Edgar, Evans, Fairhurst, Forster, Gibson, Glen, Grajewski, Harvey, Hayre, Heron, Hughes, Humby, Huxstep, Joy, Keast, Kemp-Gee, Kendal, Latham, Locke, Mans, McEvoy, McNair Scott, Mellor, Mocatta, Oppenheimer, Perry, Quantrill, Reid, Stallard, Still, Taylor, Thacker, Thierry, Vaughan, Warwick, White and Withers.

AGAINST:      21

Councillors: Chegwyn, Clarke, Collett, Mark Cooper, Craig, Dowden, Frankum, Harrison, Hiscock, House, Irish, Gavin, Kyrle, Porter, Price, Simpson, Tennent, Thornton, Tod, Wade, Westbrook.

ABSTAIN:        3

Councillors: Bennison, Burgess and Carew.

The vote on Recommendation (d) of the Council report was therefore carried.

The Additional Recommendation proposed by the Leader was put to the vote and recorded as follows:

FOR:               49

Councillors: Bennison, Boiles, Bolton, Branson, Briggs, Brooks, Carew, Carpenter, Carter, Chadd, Rod Cooper, Dibbs, Edgar, Evans, Fairhurst, Forster, Gibson, Glen, Grajewski, Harvey, Hayre, Heron, Hughes, Humby, Huxstep, Joy, Keast, Kemp-Gee, Kendal, Latham, Locke, Mans, McEvoy, McNair Scott, Mellor, Mocatta, Oppenheimer, Perry, Quantrill, Reid, Stallard, Still, Taylor, Thacker, Thierry, Vaughan, Warwick, White and Withers.

AGAINST:      20

Councillors: Chegwyn, Clarke, Collett, Mark Cooper, Craig, Dowden, Frankum, Harrison, Hiscock, House, Irish, Gavin, Kyrle, Price, Simpson, Tennent, Thornton, Tod, Wade, Westbrook.

ABSTAIN:        2

Councillors: Burgess and Porter.

RESOLVED:

That the County Council approved:

a)        The mid-year report on treasury management activity at Appendix 2 and note potential impact on the investment strategy of defaulting to a retail client with effect from 3 January 2018.

b)        The immediate commencement of applications for elected professional client status with all relevant institutions in order to ensure the County Council can continue to implement an effective investment and acknowledge that in electing for professional client status the County Council are agreeing to forgo the protections available to retail clients attached at Annex 1 of Appendix 2.

c)         That responsibility be delegated to the Section 151 Officer (the Director of Corporate Resources) for the purposes of completing the applications.

d)        The savings proposals in Appendix 3, subject to further consultation and executive decision making where necessary.

e)        The remainder of the spending required, totalling £22.5m, to complete the IT enabling and EPP programmes, following the £16.1m that was approved in July this year.

f)          Recurring funding from 2018/19 onwards of £10.25m to cover the increased costs of social workers, Home to School Transport and payments for Special Guardianship Orders.

g)        A one-off sum of £1.4m from the Invest to Save Reserve to fund additional resource within the in-house Transformation Team until the end of 2019/20.

h)        Up to £35m of capital spend (funded through prudential borrowing) to invest in the purchase of land and development of the Manydown site.

i)          An initial sum of £3m is transferred from capital to revenue between the County Council and Enterprise M3 LEP as outlined in this report and that delegated authority be given to the Director of Corporate Resources to agree further transfers if required.

j)          Capital spend of £1.23m to implement improvements whereby specialist equipment will be installed to improve the quantity and quality of data collection and monitoring in relation to water bacteria risk management.  To be funded from the savings in non-departmental budgets in the current year as identified in Section 4.

k)         An increase in the capital programme of £1m per annum from 2017/18 to raise the provision for the general replacement of and additions to the fleet managed by HTM to £3m per annum, to be funded through prudential borrowing.

l)          The addition of schemes associated with the development of land at Woodhouse Lane to the value of £41.695m to the capital programme as outlined in paragraph 11.10.

m)       Hampshire County Council calls on the Government to permit Councils responsible for administering the national Concessionary Travel Scheme, to levy modest charges on older persons’ passes, e.g. 50p for each use and £10 for issuing and renewing permits with the balance of revenue raised after costs to be used to support uncommercial, public or community transport services serving vulnerable or disadvantaged residents or areas.