Agenda item

The report will be presented by Councillor Barrie Patman, Chairman of the Budget Task and Finish Group.

As in previous years, the Thames Valley Police & Crime Panel formed a Budget Task & Finish Group to assist in discharging its statutory duty to scrutinise the Police & Crime Commissioner (PCC) for Thames Valley’s proposed Council Tax precept for 2020/21.

 

Councillor Barrie Patman, the Chairman of the Budget Task and Finish Group presented the report. He thanked Ian Thompson and Linda Waters for attending the Group and updating Members on the PCC’s draft budget proposals.

 

The Panel was informed that in normal circumstances the PCC would notify the Thames Valley Police and Crime Panel of his proposed council tax precept by 1st February 2020. However, this had not been possible this year given that the Police Grant Settlement for 2020/21 was not announced until 22 January 2020 making a formal proposal to the Panel before 1st February not possible.

 

This lateness of the preparation of the draft budget and proposed council tax precept had meant that the Budget Task and Finish Group had only had one meeting to consider and scrutinise the proposals.

 

The Chairman particularly referred to the following points:-

 

·         The proposed increase to the police element of the Council Tax was by £10 per annum for 2020/21 (for a Band D property).

·         Overall the settlement announcement was good news with an additional grant and increased flexibility in council tax precept enabling the addressing of some service and performance issues by increasing resources, both police officers and police staff, alongside the investment in technology to improve productivity.

·         Reference was made to the expected increase in demand for services over the next four years, particularly in relation to increases in terror related incidents, County Lines, cybercrime, increased reporting of complex crimes such as general sexual exploitation and Domestic Violence (DV).

·         The increase in police officer numbers nationally of 6,000 by the end of March 2021 and a further 14,000 by March 2023 would result in around an additional 183 officers in the Thames Valley in the coming year. It was noted that the impact of this would not be felt immediately.

·         The funding settlement allows for the full funding of these officers in the financial year and provides an uplift to allow for additional infrastructure and support costs for the full uplift of officers over the next three years. Estimated infrastructure funding needs for the future years from the current year’s settlement needed to be set aside.

·         There was a focus on increasing productivity by investing in technology and ensuring the appropriate process and cultural change flows from that investment to improve effectiveness.

·         Reference was made to the assumption being made that for 2021/22 and beyond that there would be full funding for additional officers under the national uplift programme, but there would only be a 1% increase in core grants and a return to the 2% council tax precept rise.

·         For the next 4 years in compiling the MTFP the following assumptions were made:

Ø  General inflation will be applied at 2.0% in each of the next 4 years; specific inflation rates are based on sector led rates, e.g. Premises at 5.7%,

Ø  Fuel at 7.0% and Utilities at 4% per annum;

Ø  specific inflation has been applied to the facilities contracts to allow for wage uplifts in relation to the National Minimum Wage (NMW) and recruitment issues (9.1%),

Ø  pay inflation has been included at 2.5% per annum for both Police Officers and Staff,

Ø  future increases in Council Tax precept at 2.0% per annum;

Ø  Council tax billing base to increase by 1.66% in 2020/21; with following increases at 1.5% per annum;

Ø  General police grants to rise by 7.5% in 2020/21; with following increases at 1.0% per annum over the period.

Ø  The use of reserves to support the MTFP & MTCP, but these will be significantly committed by the end of the four-year period.

Ø  The future investment in technology, whether direct capital purchase or revenue service contracts will need to be funded by revenue given the diminishing level of reserves and the very low level of annual capital grant. This final assumption continues to reflect the increasing demand for investment in technology and the expectation that this will continue with the rollout of national programmes to address the Policing Vision 2025, against declining reserves and minimal capital grant. The provision within the MTFP for the direct funding of capital has increased to provide an annual fund of £11m by 2021/22. This is seen as a sensible approach to future financial sustainability.

 

Details of the necessary items needed to maintain the current levels of service within Thames Valley were reported and were contained in paragraph 25 of the report.

 

Items of growth to improve performance and meet demands were reported and were detailed in paragraph 26. Particular reference was made to the reduction in capital receipts which would mean the growth areas would have to be funded from revenue accounts and reserves.

 

There were two areas of significant investment which would increase officer numbers: - Operation Uplift which gave TVP the allocated 183 additional officers from the first allocation of 6,000 officers nationally. The uplift in officers had come with additional funding in the current years settlement and would cover the full additional costs of salaries and associated on-costs.

 

The other area was Strategic Investment Funding (£4.2m) - Council tax flexibility which has enabled the identification of several investment opportunities as detailed in paragraph 27 of the report.

 

In relation to the Force Productivity Strategy, reference was made to cash savings of £106m having been taken out of the base revenue budget over the last nine years and that it was now becoming difficult to identify further efficiency savings. Those new and changed initiatives were outlined which would bring about further efficiencies.

 

In relation to reserves and balances, based on assumptions, general revenue balances would stay slightly above the approved 3% target level throughout the next 4 years. Earmarked reserves were forecast to reduce from £24.5m on 1 April 2019 to just £3.5m by 31 March 2024, including £1.4m in the Conditional Funding and SEROCU reserves which are not available to support general operational policing.

 

The Optimism Bias reserve which was created in 2018/19 with the transfer of £12m from the Improvement and Performance reserve would be fully utilised by the end of 2021/22. This reserve had been used to fund unexpected cost pressures on the Contact Management Platform and the joint ERP solution with Surrey and Sussex (Equip).

 

Particular reference was made to the Improvement and Performance reserve which was now only £1.7m. This would mean that future growth proposals would have to be funded from either council tax or by offsetting savings elsewhere in the budget.

 

The Capital Programme consisted of schemes costing £38.401m in 2020/21, which includes £1.062m of projects previously identified in the 2019/20 capital plan but which are now re-phased to allow for planning and tendering procedures, and a total of £84.416m over the 4-year period.

 

The level of investment resulted in a funding surplus over the 4-year period of £3.948m. However, this included plans to borrow £20.32m for Reading Police Station, the SEROCU western hub and Maidenhead Court in 2019/20 and 2020/21.

 

A recommendation had been put forward which was debated during the next item as follows:-

 

That the Panel approve the Police and Crime Commissioner’s precept for 2020/21 as set out in the OPCC report ‘Revenue Estimates 2020/21 and Medium Term Financial Plan 2020/21 to 2023/24’ subject to satisfactory responses to the questions raised and any other supplementary questions asked at the Panel meeting.