Agenda item

To submit the report of the Interim Head of Function (Resources)/Section 151 Officer.

The report of the Interim Head of Resources and Section 151 Officer which provided an update on the Medium Term Financial Plan 2016/17 was presented for the Executive’s consideration.

The Portfolio Member for Finance reported that the report reflects a worsening financial situation to that reported in July with the Council currently working to a revised budget shortfall in 2016/17 of £5.740m and over four years a budget shortfall of £17m.The main change is brought about by the withdrawal of the Outcome Agreement Grant which was a performance based grant paid according  to the extent to which a local authority achieved the outcomes within its agreement with the Welsh Government. The grant was worth in the region of £750k to Anglesey annually based on its success  in meeting its targets and the loss of the grant is a disappointment and a blow. The Finance Service is working with departments across the Council to identify other avenues of savings for 2016/17 and the probability is that the Authority will be offering the Voluntary Redundancy Scheme to its staff again  this year. The Welsh Government’s provisional settlement is due to be announced in October/ November and upon this announcement the Council will have a more accurate indication of its  funding for 2016/17. The Final Settlement will not be announced until late December, 2015 or early January, 2016.The Portfolio Member proposed the report with the addition that the Voluntary Redundancy Scheme be offered as part of the budget options for 2016/17.

The Interim Head of Resources and Section 151 outlined the process by which applications for voluntary redundancy are considered and he said that applications under the scheme which is open to all the Council’s staff would be scrutinised individually. It does not necessarily follow that where voluntary redundancy has been approved, each of those posts will be deleted - adjustments can be made elsewhere within the Council. The matter has been discussed at Officer level.

The Chief Executive confirmed that the SLT has considered the possibility of introducing a scheme on the lines offered the previous year.

The Portfolio Member for Performance Transformation, Corporate Plan and HR proposed that given the financial climate for local authorities is unlikely to improve in the medium term and that the  financial challenges will intensify, it would be a logical and realistic step for the Voluntary Redundancy Scheme to be built into the budget planning process as a standing option so that consideration does not have to be given on a year by year basis to whether or not it should be offered. This would also facilitate workforce and succession planning.

The Interim Head of Resources said that all redundancies need to be funded and in some cases where the employee is of the appropriate age, retirement costs would apply as well. The Council needs to be assured that it can meet those obligations. The Officer advised that as the financial outlook for local authorities for the next few years will remain challenging, it would be sensible to consider ways of developing income streams as part of the strategy to deal with the budget shortfall in 2016/17 and beyond e.g. for 2016/7 there will be a review of how fees and charges are dealt with as referred to in section 3 of the report with a view to presenting them in a single schedule rather than on a service by service basis.

It was resolved –

•  To note and adopt the report.

•  To proceed with the Voluntary Redundancy Scheme as part of the options for the 2016/17 Budget and that the scheme continues to be part of the Budget planning process on an ongoing basis for this and subsequent years.