Aberdeen City Council Budget 2004/2005
GENERAL FUND REVENUE BUDGET AND NON HOUSING CAPITAL PROGRAMME
| 1. | I rise to move the Administration's proposals for the 2004/05 Revenue Budget and Non Housing Capital programme for Aberdeen City Council. It is necessary to consider both budgets together because under the prudential regime for capital investment we have more freedoms to determine the level of capital spend which I welcome as long as we can contain the capital financing charges in the revenue budget. |
| 2. | These are the first budgets to be presented by the Liberal Democrat and Conservative partnership which forms our Administration in Aberdeen. We are deeply conscious of the trust which the people of Aberdeen have vested in us, and are equally determined not to let them down. We are already delivering on the promises made in our joint policy statement - A Partnership for Aberdeen Our three main objectives in the budget, and these underlie our longer term strategy, are: i) to create a much more stable long-term base for the Council's budget - a very serious matter to which I will return |
| 3. | Let me begin by talking about the long term. We have inherited a situation where, every year there has been a struggle each year to balance the Council's budget. The people of Aberdeen, we their Councillors, and the staff of the Council have had to cope annually with the need to make cuts in spending on services to keep expenditure in line with our revenue. We have no problem in delivering on the ongoing responsibility to deliver improvements in efficiency, but that is quite a different matter from cutting essential services to the public. The heart of the problem is under-funding by the Scottish Executive of the social work budget. This budget has to deal with constantly increasing demands for services and the detailed figures of those costs shift from week to week. We have, however, introduced more accurate trend analysis which gives us the ability to better predict demand. The indications are that for 2004/05 the demand for social work services will outstrip the budget made available to us by the Scottish Executive in terms of GAE allocations by somewhere between £15 m and £20m. This situation is not new. It is an acknowledged problem at a national level and is certainly the case in all large urban authorities. However, Aberdeen City, unlike most of those other large urban authorities, does not access the large amounts of money provided to deal with social deprivation, which can be used to offset under-funding of social work. The net situation in Aberdeen is therefore that we have required to: We have continued and stepped up the dialogue with the Scottish Executive, which we inherited from the previous Council, about the under-funding of Aberdeen. The problem is clearly a regional one and we are working in conjunction with Aberdeenshire Council and will also engage other parts of the public sector which suffer similar problems. What is absolutely clear is that this new Administration is determined to fight hard to break this long-term cycle of under-funding Aberdeen. The fact that Aberdeen has received the lowest per-head settlement in Scotland is an utter disgrace. As one of the areas contributing most to the Scottish economy, we need better, Aberdeen deserves better. We are not asking for handouts - what we need is a fair deal, and the ability to keep enough of the money raised here to ensure that our citizens get the services they need and deserve. Much has been made of the extra expenditure granted by the Scottish Executive over the past year, but it must be made clear that the majority of this is ring-fenced to specific projects. We have no say over how it is spent. It is given by the Scottish Executive on condition that we use it to fund their priorities, leaving us no local control. We cannot divert ring fenced money to the areas in which we, the local elected representatives, see the most need. |
| 4. | I now move on to address the areas in which we gave commitments in the document "A Partnership for Aberdeen" which was adopted as Council Policy in June of 2003, because we are determined to deliver on those commitments and they therefore drive our budget priorities. I have circulated as Appendix 1 details of savings and growth items in the Revenue Budget. Appendix 2 details additional projects we propose including in the Non Housing Capital Programme. I will return to the revenue savings later but can I highlight some of the growth items under both the Revenue and Capital budgets |
| 4.1 | Involving People and Good Government Substantial progress can be made and is being made in this area which is about how we do things and does not necessarily require additional expenditure. However, we believe that people need adequate support and as an important step in this we have agreed: · Community Centre Budgets Increase (Revenue Budget) £23,000 This extra money recognises the sterling efforts of so many local people who give of their time in our Community Centres. We appreciate the work that goes on there, whether it be with young people, senior citizens, parent & toddler groups etc. The budget for grants to Community Centres has been frozen since 1997, and this is a small gesture towards restoring a balance. |
| 4.2 | We intend to continue to make Education one of our top priorities in the city and I will indicate to you just one or two of the areas in which you will see further development. · Kingswells School £2,205,000
In our Library Service In terms of Community Facilities Sports and Leisure Facilities This money will enable us to start on a programme of renovation of Aberdeen's much-used but sadly dilapidated playing field changing rooms, a difference which will be seen by the many dozens of teams and thousands of people regularly using the Council's sports grounds and playing fields · New Opportunities Fund Supported Development £330,000 In the field of Arts and Culture we believe that to make best use of the talent which exists, there is a clear need for visionary leadership within the city, so as well as continuing existing projects, we have established an important short life working group which is due to report in late Spring or early Summer and which will provide the vision for the way forward. We will allocate resources to the achievement of that vision and are already working hard with national funding bodies to ensure their support. In the meantime we propose the following: Arts and Culture |
| 4.3 | Environment and Infrastructure I indicated earlier that we have a major overall funding difficulty in social work and that other service areas, particularly Environment and Infrastructure, had been hit in order to maintain those social work services. The evidence of this is to be seen all over Aberdeen and, to be fair, this is a national issue which local authorities have repeatedly raised with the Scottish Executive. We, therefore, intend over time to redress this balance and trust that this will be evident in the decisions which we have made to date for instance, to commit an additional £750,000 to resurfacing pavements and in the proposals which follow: · Rolling Out Major Investment in Recycling (from Strategic Waste Fund) almost £2,000,000 Transport · Additional Don Crossing (Access from the North) Initial Work £250,000 |
| 4.4 | Within City Development there will be a further large-scale investment through the monies which we have gained from the City Growth Fund: · Consolidating Aberdeen as Energy Capital of Europe £500,000 We will also continue the very well received Civic Pride campaign supporting it as follows: · Improved signage £100,000
These are areas which we know have historically been under-funded in order to deal with the demands for Social work which I explained earlier, and are areas which we are committed to improving further when the Social Work budget situation is resolved. |
| 4.5 | Social Work I am pleased to announce that we have increased the budget for the Social Work Services from seventy-nine and three quarter million pounds in 2003/04 to over eighty three and a half million pounds for next year. Within this we have taken into account the need for additional resources to implement the Mental Health (Care and Treatment) Act and have also identified additional funding for Occupational Therapy Services recognising the importance of this service in helping people lead more independent lives. This Social Work budget therefore continues the long-standing commitment of the Council to Social Work Services for vulnerable people. We will again provide resources for Social Work Services significantly over the Grant Aided Expenditure figures, which form the basis of Scottish Executive funding for local services. The overall gap between the GAE and what we know we require to provide Social Work Services has now risen to over seventeen million pounds. This funding gap has grown in recent years (particularly in relation to Children's Services) and this is something that must be addressed with great urgency by the Scottish Executive and ourselves. If the current growth in demand for Social Work Services were to continue then, even with these additional resources, the Chief Social Work Officer is concerned that the Councils ability to meet its statutory responsibilities to vulnerable people in need may be compromised. We are in this position because of the massive shortfall in Central Government funding, but we intend to fulfil our responsibilities, and ensure that the position is closely monitored. Given these circumstances, it is particularly important we engage in dialogue with the Scottish Executive regarding the inadequate level of funding they provide, given the levels of need within Aberdeen. As Leader of the Council, I will be raising this urgently with ministers. It is equally important that we continue to work at improving our own efficiency and effectiveness. This is something we are already committed to through the adoption of the Council's Commissioning Strategy for Social Work Services and the establishment of a Commissioning Board. The Commissioning Board will be charged with delivering best value in Social Work Services and in the coming months will direct work to redesign commissioning and service delivery arrangements within the Social Work Service to reduce the gap between the Social Work budget and the GAE for Social Work Services by one million pounds in 2005/06. We propose taking £1 million from Reserves as an interim measure in 2004/05 until these new initiatives come into effect in 2005/06. In addition a number of initiatives amounting to £1,000,000 will be introduced or continued into 2004/05 to sensitively respond to the current needs led growth. We have put in place the building blocks for good housekeeping but must also insist that the City gets a fair allocation of resources from the Scottish Parliament. As part of this process we have built into the Budget Housing The Council's commitment to alleviating homelessness in the City continues to have a high priority. The Council has recently completed the preparation of its Homelessness Strategy which has been drafted with partners working with homeless people and is now delivering new services in this area. The Housing (Scotland) Act 2001 increased the responsibilities on the Council and increased the assistance which has to be provided to homeless persons. In 2004/5 additional monies from the Scottish Executive will help with the continuation of 4 posts, Homelessness Strategy Co-ordinator, 2 Advice and Resettlement Officers and an additional Homelessness Officer at a cost of £98,000. An additional accommodation unit has been purchased and is currently being renovated with the use of £300,000 funding from the Scottish Executive. This will provide a further 13 temporary accommodation bed spaces . This money would otherwise have been a charge to the Housing Revenue Capital Account. Proposals to undertake surveys into the work required to upgrade Victoria House are to be funded by from the Scottish Executive money. This is likely to cost £180,000 in 2004/5. This money would have had to be funded from General Services Capital. New funding has been provided by the Scottish Executive for next year for Furnished Tenancy Grants. £162,000 has been allocated which will allow up to £3,000 to be provided to purchase essential items of furnishings to allow homeless people to move into tenancies with the City Council or a Housing Association. |
| 4.6 | Community Safety We will continue to fully fund our contribution to the Police and Fire and Rescue Services. In addition to include: |
| 4.7 | An Open Council · Freedom of Information Act Implementation (Revenue Budget) £50,000 |
| 5. | In order to balance the budget I am also proposing the other savings/additional income generation detailed at Appendix 1. To achieve a balanced budget I am proposing a Council tax increase of 8.6% with a Council Tax collection level of 97.6%. Appendix 4 provides details of the new Council tax levels. It should be noted that with the reduction in water and waste water charges the overall net increase in the bills is 5.54%. |
| 6. | Conclusion I would like to conclude by thanking everyone for the incredible amount of hard work which has gone into preparing these budgets. In particular, my personal thanks to Cllr Neil Fletcher, Cllr Alison Smith, Cllr Ian Yuill and Cllr John Porter, who have driven the process through. Also, my deep gratitude to all the Council's officers who have given of their time to advise us, and especially those from Finance & ICT and the Office of Chief Executive. As I said in my introductory comments this is a thoughtful budget designed to achieve long term stability for the City - an approach which is reflected also in the housing budget and our approach to the Common Good. We will deliver on our commitments and we'll gear our budgets to that. This is very different from previous Administrations. People in Aberdeen will see real differences as will the Scottish Executive who will no longer have any excuse for underfunding Aberdeen and the North East. |
| 7. | Recommendations I move that we approve all details set out in Appendices 1 to 4. Council Budget 2004/2005 - Appendix 1 |
