Budget Speech of Councillor Nigel Holdcroft, Conservative Leader of Leader of Southend-on-Sea Borough Council 25th February 2010

As we approach the end of another financial year, and with both general and local elections looming, this seems an appropriate moment to stop for a moment and look back on the journey this authority has travelled, during the last 5 years, under the Conservative administrations lead by myself, Anna Waite and Murray Foster, and based on the foundations established by Howard Briggs.

It is too easy to forget that back in 2005, as a 2 star authority, we were at significant risk of intervention from the Audit Commission. Key services were struggling with zero star rating for housing and supporting people, uncertain prospects for waste and street cleaning, and poor recycling performance. There were 6 schools in special measures, no clear vision, budget overspends, severe cuts to front line services, lack of customer focus, low staff morale and under performing partnership working.

The areas of excellence, such as revenue and benefits, and culture, were being overshadowed by a failure on the part of other parts of the organisation to step up to the plate as a unitary authority.

So what now – 5 years on. Contrary to the impression which some members of this chamber seek to give there has in fact been a massive and positive transformation of this authority driven by this administration and our senior officers. The Direction of Travel report 12 months ago confirmed that we had sustained or made progress in every CPA framework element since 2006 and were one of a small number of authorities graded as improving strongly.

This year’s CAA scores confirm that we have once again consolidated our position as a 3 star authority, which is performing well with consistent scores across our organisational assessment, use of resources and performance management. In all service areas we have driven forward improvement, with supporting people now being rated 2 out of 4 with promising prospects and with landlord services, children’s services, adoption and fostering services, adult learning, and adult social care all scoring 3 out of 4. We have achieved a level 3 for equalities, our culture and revenue and benefits teams have continued to excel and others such as those in events and regeneration are delivering remarkable outcomes.

These results and others like them reflect the real progress which we have made in our service delivery, whether in increasing domestic recycling from 21% to 42%, reducing the number of households in temporary accommodation, or increasing the number of our elderly supported to live in their own homes. Just three examples but indicative of similar progress across all areas of our activity.

We have enjoyed a flurry of awards across the organisation to include this year’s short listing in the top 5 by the LGC for the most improved council of the year and best children’s services provision.

However what makes this transformation even more remarkable is that it has been achieved in circumstances where we have made over £30M of economies in our revenue budget, not only to meet the census linked funding deficit, but also to ensure that we have been in a position to invest in services to meet the increasing demands from our residents and also to make progress towards those goals which we have identified as our priorities.

This has been achieved by a talented and enthusiastic group of senior officers whom we have assembled to support the drive and determination of our Chief Executive and who have collectively helped unlock the potential of so many of our more junior staff who needed encouragement, belief and opportunity to lead our drive forward. However these steps would also not have happened without the ability and determination of successive Conservative administrations who have shared a simple ideological goal namely the provision of excellent services delivering good value for money and creating a better Southend.

I now turn to our budget proposals for the coming year. We in common with the rest of the public sector face a challenging few years. Whatever the colour of the next government it is clear that local government will be expected to deliver significant economies whilst facing increasing demand for our services and rising expectations from our residents. It is a familiar pattern that as the private sector starts to emerge from recession it is public sector’s turn to face recessionary conditions. As a result this is a time for sound financial judgements, which help us, prepare for the challenges to come.

As we are all aware before the start of this budget process there was a £2.2M gap in the Medium Term Financial Strategy, which needed to be bridged. That shortfall has been further aggravated by the increase in the cost of borrowing, the reduction in our investment returns, the inevitable pressure on fee income as a result of the current economic situation, and the increasing demand on our services.

In such circumstances it is indeed testament to our financial management that we are presenting a balanced budget which allocates £4.3M to meet inflation and increased demand on services, a similar sum of £4.3M to provide investment in services and allocates £1M to reserves to meet certain specific and inevitable cost demands in the future.

This is achieved by proposing efficiencies and savings of over £6M, which we are confident, will have no effect on our front line services and, whilst leading to a slimming of our organisation by about 40 posts, will not result in any compulsory redundancies.

Closer consideration of our proposed growth areas will reveal some running themes from my previous budget speeches –

• extra funding to meet the challenge of supporting our aging population in a manner which best preserves their dignity and independence and including further investment in the excellent Telecare system,
• additional resources for those with mental health needs,
• extra funding for our excellent foster care and children social care services,
•  increased funding to combat domestic violence,
•  yet further increases in our spending on highway maintenance,
• additional funding for sea defences, and,
• an increase in grants to voluntary organisations who have such an important role to play in these difficult financial times.

There is also a further sum of £150K to meet the extra and ongoing costs of the concessionary bus fares scheme and a freeze on car park charges to ensure that we attempt to support the sterling efforts of our traders and businesses to keep going and to lead us out of recession. Indeed those fees and charges which are not determined by central government have been carefully reviewed to balance the need for income generation with the risk of deterring increased use and activity.

Our philosophy remains clear and applies to each and every Conservative candidate standing in Southend on 6^th May – a determination to deliver sound common sense policies which maintain core services, make provision for those most in need, and set the agenda for the challenges to come.

So how are these savings achieved? It is rewarding to note that we are starting to see the benefits of the funding and policy decisions, which this Tory administration has made in previous years. Investment in our homeless section means that we have fewer people in bed and breakfast accommodation, which not only delivers savings, but also gives those unfortunate enough to be in that position improved accommodation. The drive to support our elderly in their own homes, whether by Telecare or otherwise, means that our residential care costs are reducing. We have delivered savings from the school transport contract, and have imposed an inflation freeze on supplies and services.

Perhaps most importantly this year will see the first effects of the Delivering Excellence initiative, which is designed to identify financial savings of £15M over the next 5 years by creating a major shift towards the customer and away from organisational structures and boundaries. It will deliver efficiencies and quality improvements through simplification and standardisation. We have set our officers the challenge of delivering savings of £1.6M through this programme during the coming year.

Our proposals are based on a revenue budget of just over £130M of which approximately £69M will be funded through the council tax. The tax increase proposed is 2.95%, which amounts to 61p per week for a band D property.

 I make no apology for reducing the proposed increase from that contained in the MTFS or as detailed in the original draft budget papers. Unlike some others in this chamber my party colleagues and I share an aspiration that council tax rates should be kept as low as possible. We had been uneasy about the % rate increase originally proposed bearing in mind the challenging economic situation, which our residents currently face. Developments since the release of the original draft budget papers, to include in particular the negotiations on the employee pay award and our insurance premium renewal, resulted in an opportunity to reduce the increase by challenging our officers to close the remaining gap without adverse effect on services – something that they have been able to achieve. I am particularly delighted that this allows us to respond positively to the representations, which were made to us on the subject by the Older Peoples Assembly, the Business Ratepayers Consultative Forum and others.

The purpose of our rather convoluted process is to publish budget proposals as soon as possible in draft form and then to take them to all 3-scrutiny committees to enable opposition members to make comment or suggestion and in addition to engage in public consultation. Once again the level of opposition involvement in this process was disappointing and interestingly at no stage prior to Tuesday’s cabinet had any opposition member spoken to me either directly or at scrutiny suggesting that a reduction to the tax rate was desirable or achievable.

During the current year our residents have enjoyed the 3^rd lowest council tax when compared with other unitary authorities and the 2nd lowest in Essex. Following this budget, and based on the information currently available we will remain the 2nd lowest in Essex and within the lowest quartile of unitary authorities. I would add that this statistic is further distorted to our disadvantage by the fact that the average property in Southend is in a lower council tax band than in many of our comparable authorities so that the income we generate from our council tax is less.

What these statistics clearly demonstrate is that this administration is delivering high quality and improving services notwithstanding low council tax rates and the resulting effect on our income.

The Housing Revenue Account and our tenants continue to face a double whammy from the government arising from the indefensible negative subsidy and the determination to achieve convergence between council and housing association rents. The disgraceful process whereby the government plunders our housing revenue account will result in a negative subsidy payment of £1,875,000 in the coming year and government guidelines leave us with no viable alternative but to raise rents at an average of 3.1%. We continue to do all we can to assist our tenants by driving down the management fee by a substantial amount and by making no increase in the charges for heating and careline.

Now I turn to the capital budget. During the current year we will deliver capital projects to a value of over £100M. Never before has this authority achieved such performance, not only in the value of the work completed, but also the control, timing and management of an immense range of schemes. I believe that there is starting to be a real feel of renewal and investment in the Town. This is not only as a result of our landmark and strategic schemes such as

• our new swimming and diving facility at Garons – which is tempting the UK Olympic team and others to Southend,
• the much needed new school building at Belfairs,
• the new state of the art multi storey car park in London Road with student accommodation above,
• the package of improvements at East Beach,
• the commencement of the City Beach project and our other substantial highway schemes,

but also from the massive investment made to our roads, schools and other social and cultural facilities.

Just reflect for a moment on the continuing policy of improvements to our playgrounds, such as the recently completed scheme in Chalkwell Park, our public toilets, the enhancements to our sports facilities such as the improved changing facilities at Shoebury and Belfairs pools and, the continuing development of a town wide network of cycle facilities and routes.

In the coming year we plan further schemes to a value of £113M to include £8M of new items. This will see our continued investment in the structure, and equally if not more importantly, in the infrastructure of our Town with

• further increased capital investment in our roads and street lights,
• the pursual of our new joint use library at Elmer Square – a truly cutting edge collaboration between public sector partners, and
• the provision of funding to replace the promised Sea change money now withdrawn by the Government to develop the Pier Head.

This is in addition to a range of enhancement and improvement schemes, investment in our IT to ensure that we have the tools to deliver ever better performance, and financial support for our bid for Building Schools for the Future funding to access money to improve our school stock as we have already done so successfully with Decent Homes money for our housing stock.

This is truly a demanding and massively exciting programme, which, if we can deliver it, will continue to revitalise the town and act as a magnet for private investment. This is something, which we are already witnessing whether at the airport, in the reopened Palace Hotel, the revitalised Sea life centre or elsewhere.

I have already mentioned the challenges which local government will face in the next few years. Significant reduction in our revenue budget is inevitable. Reduction in staff numbers will be unavoidable and we will be forced to work ever harder to protect our services and meet our priorities. This year our residents face increasing inflation and unemployment and our employees are threatened with no rise in salary levels. In recognition of these realities I am pleased to confirm that my Conservative colleagues and I are unanimously agreed to oppose any increase in council member allowances for the coming year and I would hope that all other groups would support this call. Whilst in financial terms this gesture may be of limited value it is intended to represent a symbol of support from each and every one of us to our residents and staff.

I believe that this is a budget, both as to revenue and capital, which all members of council can and indeed should feel proud to support. It demonstrates an administration, which knows precisely where we want to go and how to get there. It is a budget of consolidation, of continued progress and of preparation for the inevitable financial trials ahead and I commend it to the chamber.