THE BIRMINGHAM BUDGET 2013/14 AND TO 2017
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THE BIRMINGHAM BUDGET 2013/14 AND TO 2017 CONSULTATION AND DEBATE Peter Hay PowerPoint PPT Presentation


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THE BIRMINGHAM BUDGET 2013/14 AND TO 2017 CONSULTATION AND DEBATE Peter Hay Strategic Director Adults and Communities. Our controllable budget. Where Government Grant Cuts Have Fallen. Reductions in Government Funding. Average for country £74 per person Birmingham’s :£149 per person

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THE BIRMINGHAM BUDGET 2013/14 AND TO 2017 CONSULTATION AND DEBATE Peter Hay

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The birmingham budget 2013 14 and to 2017 consultation and debate peter hay

THE BIRMINGHAM BUDGET 2013/14 AND TO 2017

CONSULTATION AND DEBATE

Peter Hay

Strategic Director Adults and Communities


Our controllable budget

Our controllablebudget


Where government grant cuts have fallen

Where Government Grant Cuts Have Fallen


Reductions in government funding

Reductions in Government Funding

  • Average for country £74 per person

  • Birmingham’s :£149 per person

  • If cut by national average :extra £79.2m each year


The challenge

The Challenge

  • Over a six-year period, from 2010/11 to 2016/17, the forecast total Government grant to Birmingham City Council will reduce by at least £310m.

  • At the same time, we will need to pay for unavoidable cost increases, due to the following:

    • Inflation

    • Changing need in the city’s population

    • Changes in legislation

    • Financing Costs


The birmingham budget 2013 14 and to 2017 consultation and debate peter hay

By 2016/17 the combined impact of rising costs and reducing grants mean that we need to make cuts of around £600m


Funding and pressures

Funding and Pressures


Resources uncertainty

Resources Uncertainty

  • Business Rates Retention Scheme - Apr 2013

  • Formula changes in setting baselines

  • Adjustments to Government overall funding levels

    • School related overheads £7m (currently assumed)

    • Early Intervention Grant – Nursery Places for 2 year olds £8.2m (not currently assumed)

    • Early Intervention Grant – General Top Slice £4.1m (not currently assumed)

  • Settlement - current rumours are it could be as late as 19th December


Council tax

Council Tax

  • February 2012 LTFP assumed 1.9% (+£4.9m)

  • Currently assuming an increase within the previously proposed 1.64% referendum limit * (£0.7m less)

  • Council Tax Freeze Grant worth £2.6m for two years (£2.3m less than LTFP, and £4.9m less from 2015/16).

  • What should be the level of the Council Tax increase?

    Note: Government has withdrawn draft regulations, guidance on the calculation of the referendum limit % is not now expected until the Finance Settlement.


If we increased council tax

If We Increased Council Tax?

Every 1% rise only raises in total £2.55m


Use of reserves

Use of reserves?

Our reserves are modest for the size of the organisation, and are earmarked for specific purposes


The birmingham budget 2013 14 and to 2017 consultation and debate peter hay

Shared services and efficiency?

Entire back office costs less than £100m


What have we done so far

What have we done so far?

  • £275m of savings in the last 2 years

    • Reduced staff by 27%

    • Transformed and streamlined back office systems

    • No staff cost of living increases since 2010

  • Reached the point where efficiency savings are not enough

  • Entire back office costs less than £100m


What else are we going to do

What else are we going to do?

Extending last year’s savings proposals

Setting out new proposals for this year

A thorough review of all Council services, which may end in some services being provided differently or stopped altogether


The birmingham budget 2013 14 and to 2017 consultation and debate peter hay

Service Categorisation

Fit to outcomes

  • “Lite” review

  • Small efficiency target

  • Invest?

  • “In depth” review

  • Efficiency target

  • Invest?

  • Re - commission

  • Savings target

  • Statutory minimum?

  • Social enterprise?

Fit for purpose

  • Downsize service

  • Savings target

  • Statutory minimum?

De-commission

Or near-zero cost solution

De-commission

Or near-zero cost solution


Budget reduction proposals

Budget Reduction Proposals

Supported by Service Factsheets


2013 14 savings schedule

2013/14 Savings Schedule


The birmingham budget 2013 14 and to 2017 consultation and debate peter hay

Our Approach

  • Immediate and pressing decisions for 2013/14, but …

  • …start planning and working now to deal with 2014/15 onwards

  • Key questions:

    • Are we doing the right things?

    • Are we doing them right?


Service reviews 2013 2017

SERVICE REVIEWS 2013 → 2017

We will be conducting a thorough review of Council services, and the contribution they make to local priorities and legal requirements.

This is likely to result in decisions to provide some services in new ways, and to de-commission some others

We will deliver savings from this process in order to address the medium-term challenge, and also to realise some benefits in 2013/14.

Total Budget Reduction expected from this process by 2017: £197.6m


Process and timeline

Process and Timeline

  • Public Meetings and a disability forum

  • Separate consultation on specific proposals

  • Budget views on the website and on line survey – closes 6th January 2013

  • Budget and Council Plan 2013/14 reviewed by Cabinet, Monday 11 February 2013

  • Budget and Council Plan 2013/14 presented to City Council Tuesday 26 February 2013


Your views

Your views

  • Strategic Implications

  • Commissioning and contracting

  • Long term public finance in Birmingham and what it means for you

  • Council will consider new approaches


Discussion

Discussion


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