Agenda item

General Fund Revenue Budget 2016/17 and Non-Housing Capital Programme 2016/17 to 2020/21 - CG/16/018

Meeting of Budget Meeting, Council, Thursday, 25th February, 2016 2.00 pm (Item 2.)

The EHRIA’s attached relate to appendix 3 of this report

Minutes:

The Council had before it a report by the Interim Director of Corporate Governance which provided details of the 2016/17 General Fund Revenue budget and the Non-Housing Capital Programme for 2016/17 to 2020/21.

The report recommended:-

that the Council -

(a) set a revenue budget for 2016/17;

(b) note the net movement between appendix 1 and appendix 2 of the report of £3.39million;

(d) agree to the conditions of the Local Government Finance Settlement for 2016/17 in so far as it is within its legal powers to do so (further details are given in paragraph 5.5 of the report);

(e) approve the recommended use of reserves which specifically includes a Risk Fund and non-earmarked reserves;

(f) approve the Prudential Indicators as at appendix 8 to the report;

(g) approve the transfer payment to Visit Aberdeenshire, being the new organisation replacing Visit Aberdeen;

(h) instruct the Chief Executive to prepare a report to the Finance, Policy and Resources Committee on the City Region Deal outlining the financial implications for projects agreed under the Heads of Terms agreed with the United Kingdom and Scottish Parliaments; and

(i) approve the level of funding for 2016/17 in relation to the Integration Joint Board.

Councillor Laing moved, seconded by Councillor Boulton:-

That the Council -

(1) set a revenue budget for 2016/17 as below;

(2) note the net movement between appendix 1 and appendix 2 of the report of £3.39million;

(3) approve the Non-Housing Capital Programme as below and instruct officers to review the education provision in the Tillydrone and Torry communities, recognising the rising school aged population resulting from new housing developments and increased birth rates in these areas, reporting back to committee in the September 2016 cycle of meetings with detailed options appraisals, including details on suitable sites, project timelines and including full cost of delivery such as land acquisition, building demolition, ground surveys and construction costs;

(4) agree to the conditions of the Local Government Finance Settlement for 2016/17 in so far as it is within its legal powers to do so (further details are given in paragraph 5.5 of the report);

(5) approve the recommended use of reserves which specifically includes a Risk Fund and non-earmarked reserves;

(6) approve the Prudential Indicators as below;

(7) approve the transfer payment to Visit Aberdeenshire, being the new organisation replacing Visit Aberdeen;

(8) instruct the Chief Executive to prepare a report to the Finance, Policy and Resources Committee on the City Region Deal outlining the financial implications for projects agreed under the Heads of Terms agreed with the United Kingdom and Scottish Governments;

(9) approve the level of funding for 2016/17 in relation to the Integration Joint Board;

(10) instruct the Head of Finance to prepare a report to the Finance, Policy and Resources Committee meeting in April 2016 showing the per head of population grant Aberdeen City Council receives from the Scottish Government in comparison to other local authorities but in particular Dundee, Edinburgh and Glasgow based on the settlement received;

(11) instruct the Chief Executive to bring forward proposals to the Council meeting in May 2016 on how the Council can become an accredited Living Wage Employer;

(12) instruct the Chief Executive to bring forward proposals to the Council meeting in May 2016 on how the Council can become an accredited Investor in Young People;

(13) instruct the Chief Executive to bring forward to the Finance, Policy and Resources Committee meeting in September 2016 a report giving consideration to the Council joining Poverty Alliance Scotland as an integral part of the Council’s strategy on Opportunities for Tackling Poverty and Inequality also due to be reported at that meeting;

(14) instruct the Director of Communities, Housing and Infrastructure to report back to the Finance, Policy and Resources Committee in June 2016 on how the powers conferred on the Council through the Community Empowerment Act in relation to Non Domestic Rates could be used for the benefit of businesses and communities in the city;

(15) instruct the Director of Communities, Housing and Infrastructure to report back to the August 2016 meeting of the Communities, Housing and Infrastructure Committee having explored options for the development of an Energy Services Company (ESCo) to provide a heat network and to manage the heat and electricity that will be produced from the proposed Energy from Waste facility at Tullos; and

(16) instruct the Chief Executive to bring forward to the Communities, Housing and Infrastructure Committee proposals for the Council to accelerate the delivery of affordable and social housing within the Aberdeen city boundary utilising all relevant fiscal mechanisms, including asking the Scottish Government to use their devolved powers to help support these opportunities and to report back to Council at its meeting in August 2016.

Administration Budget Proposals
		£000	£000
Deficit per Council Report			2,403

Appendix 1 (Cost Pressures Identified and reviewed for 2016/17 Budget Papers)
	Fully Accepted
Appendix 2 (Adjustments not requiring Committee Approval)
	Fully Accepted
Appendix 3 (Adjustments requiring Committee Approval)
	As Below

Ref No	COMMUNITIES, HOUSING & INFRASTRUCTURE
1	Pets Corner will receive capital investment to improve the facilities provided and with a new educational space becoming available an income target would be set to generate additional funds.	(2)
2	Extend Pilot Stay On Site Approach to S1 Lunches at two of the council’s Academies and encourage healthy eating.	(50)
3	FM Contract Management Fees for NHS Grampian & NHS Highland could be increased.	(3)
4	Review Street Occupation Charges with a view to increasing the charges to utility companies.	(100)
5	As the council is currently negotiating a City Region Deal it would be possible to reduce the funding to Opportunities North East (ONE) by 50% through reviewing and re-evaluating strategies and funding levels	(70)
6	By undertaking a review of transport demands from Social Care & Education facilities it would be possible for the expansion of the in-house fleet to replace the contracts currently delivered by external providers.	(25)
7	Review All Environmental Health & Trading Standards Charges and to increase them broadly in line with inflation each year where the charges are not set by statute.	(5)
	TOTAL FOR COMMUNITIES, HOUSING & INFRASTRUCTURE		(255)

	EDUCATION & CHILDREN'S SERVICES
8	This option is a reduction in funding to Sport Aberdeen. The Council would work with Sport Aberdeen to determine the proposals to manage this reduction.	(405)
9	This option is a reduction of 2% funding to Aberdeen Sports Village (ASV). The Council would work with ASV to determine the proposals to manage this reduction.	(20)
10	A review of the Service Level Agreement with NHS Grampian regarding the provision of Speech & Language Therapy services would allow a reduction in costs depending on the level of service being purchased.	(100)
11	This option extends the review of Admin and Supplies Budgets to Schools and would result in a small reduction in the level of DEM budget available for schools in 2016/17.	(280)
12	Arising from the implementation of the inclusion review, pupils with Additional Support Needs will be educated at their local schools. This will reduce the number of children requiring transport and therefore the number of escorts required over a 5 year period.	(20)
13	The secondary teaching staffing formulae is weighted to allow for S1 and S2 classes in Maths and English to be set at a maximum of 20. Since 2010/11 schools were no longer required to do this and are therefore free to divert these resources to other areas.	(440)
	TOTAL FOR EDUCATION & CHILDREN'S SERVICES		(1,265)

	Balance Carried Forward		883
		£000	£000
	Balance Brought Forward		883

	INTEGRATION JOINT BOARD
14	Saving on management and infra. costs of Bon Accord Care in line with those applied to other services for 2016/17 e.g. vacancy factor increase, reduction in energy consumption, overtime budget reduction etc.	(250)
15	Comprehensive review of the current service delivery model through Bon Accord Care. The Council would work with Bon Accord Care to determine the proposals to manage this reduction.	(450)
	TOTAL FOR INTEGRATION JOINT BOARD		(700)

	TRADING
16	Review of apprenticeship scheme within Building Services to improve quality of training and maximise and secure future supply of 'home grown' trade qualified staff.	(150)
17	Convert Free Car Park (Crombie Road, Torry) to £1 for 2 hour max stay chargeable car park and introduce commercial use of Council asset.	(28)
18	Convert Free Car Park (Dunmail Avenue, Cults) to £1 for 2 hour max stay chargeable car park and introduce commercial use of Council asset.	(9)
19	Convert Free Car Park (Station Road, Bucksburn) to £1 for 2 hour max stay chargeable car park and introduce commercial use of Council asset.	(3)
20	Convert Frederick Street Car Park to long stay and introduce permits for improved commercial use of Council asset.	0
	TOTAL TRADING		(190)

	Balance Carried Forward		(7)
		£000	£000
	Balance Brought Forward		(7)

New Initiatives
	Grant to Aberdeen Care & Repair	35
	Establish post - Violence Against Women Co-Ordinator	28
	Establish post - Disability Access Officer	23
	Bus - Evening Service to Craigiebuckler/Airyhall; Weekday Daily Service to Mannofield and Airyhall and Lower Deeside	83
	Finance additional borrowing	38

	Total New Initiatives		207

	Financed By:
	Use of General Fund Contingency		(200)

	Revised (Surplus)/Deficit		0

Administration Non-Housing Capital Budget Proposals

		Budget	Budget	Budget	Budget	Budget	Total
Non-Housing Capital Programme		2016/17	2017/18	2018/19	2019/20	2020/21
		£'000	£'000	£'000	£'000	£'000	£'000
	Original Budget Per Appendix 6.	157,458	161,873	69,916	62,201	65,475	516,923

	Add:
	Tillydrone Primary School (Note 1)	1,000	13,000	3,000			17,000
	Torry Primary School and Hub (Note 2)	700	16,300	3,000			20,000
	New Budget	159,158	191,173	75,916	62,201	65,475	553,923

	Additional Cost	1,700	29,300	6,000	0	0	37,000

	Funded By: Additional Borrowing	(1,700)	(29,300)	(6,000)	0	0	(37,000)

	Note 1:
	A Three Stream Primary school

	Note 2:
	A Two Stream Primary School and Community Hub

	Please note: these costs represent a new build and exclude land acquisition, demolition and other associated costs

ABERDEEN CITY COUNCIL

2015/16 to 2020/21

THE PRUDENTIAL CODE

For Capital Finance in Local Authorities

From 1 April 2004, Councils are required by Regulation to have regard to the Prudential Code (the Code) when carrying out their duties under Part 7 of the Local Government in Scotland Act 2003.

In setting the revenue and capital budgets, members will be aware that under the Prudential Code, the level of capital investment is determined locally. Therefore, these indicators will be reviewed on an ongoing basis to ensure that the Council does not breach the indicators it sets.

The key objectives of the Code are to ensure:-

· The Council’s capital programmes are affordable, prudent and sustainable.

· Treasury management decisions are taken in accordance with good professional practice.

The Code also has the objectives of being consistent with and supporting local strategic planning, local asset management planning and proper option appraisal.

In setting the indicators, cognisance should be paid to the level of capital investment looking ahead for a three year period, for both the housing and non-housing capital programmes that the Council wishes to embark upon. The Code also requires that the underlying requirement to finance PPP projects and finance leases be included when setting the indicators.

The Code requires the following Prudential Indicators are set for the Council:-

Capital Expenditure

Non HRA

HRA

2014/15

£’000

Actual

57,923

39,295

2015/16

£’000

Estimate

91,776

55,329

2016/17

£’000

Estimate

156,158

48,084

2017/18

£’000

Estimate

191,173

58,077

2018/19

£’000

Estimate

75,916

59,358

2019/20

£’000

Estimate

62,201

60,269

2020/21

£’000

Estimate

65,475

61,141

Ratio of Financing Costs to Net Revenue Stream

Non HRA

HRA

2014/15

Actual

6.3%

15.7%

2015/16

Estimate

6.3%

15.5%

2016/17

Estimate

6.9%

16.8%

2017/18

Estimate

7.2%

17.6%

2018/19

Estimate

7.7%

18.5%

2019/20

Estimate

8.1%

18.1%

2020/21

Estimate

8.3%

17.5%

Capital Financing Requirement

Non HRA

HRA

Total

2014/15

£’000

Actual

486,619

228,997

715,616

2015/16

£’000

Estimate

497,292

254,703

751,995

2016/17

£’000

Estimate

518,278

272,714

790,992

2017/18

£’000

Estimate

601,115

299,451

900,566

2018/19

£’000

Estimate

624,002

325,760

949,762

2019/20

£’000

Estimate

621,493

350,796

972,289

2020/21

£’000

Estimate

619,965

374,372

994,337

The Prudential Code states:

“In order to ensure that over the medium term net borrowing will only be for a capital purpose, the local authority should ensure that net external borrowing does not, except in the short term, exceed the total of the capital financing requirement in the preceding year plus the estimates of any additional capital financing requirement for the current and next two financial years.”

The Head of Finance reports that the Council can meet this requirement in 2015/16, and it is expected to do so for the future years, as outlined, taking into account current commitments, existing plans, and the assumptions in this report.

Authorised Limit for External Debt

Operational Boundary

10% Margin

Total

2015/16

£’000

770,154

77,015

847,169

2016/17

£’000

809,151

80,915

890,066

2017/18

£’000

918,725

91,872

1,010,597

2018/19

£’000

967,921

96,792

1,064,713

2019/20

£’000

990,448

99,045

1,098,493

2020/21

£’000

1,012,496

101,250

1,113,746

Operational Boundary for External Debt

Borrowing

Other Long Term Liabilities

Total

2015/16

£’000

664,091

106,063

770,154

2016/17

£’000

705,566

103,585

809,151

2017/18

£’000

817,751

100,974

918,725

2018/19

£’000

870,169

97,752

967,921

2019/20

£’000

895,693

94,755

990,448

2020/21

£’000

919,535

92,961

1,012,496

The estimate of the incremental impact of capital investment decisions proposed in the report, over and above capital investment decisions that have previously been taken by the Council are:

(a) for Band D Council Tax

2016/17

£0

2017/18

£0

2018/19

£0

2019/20

£0

2020/21

£0

(b) for average weekly housing rents (assuming that increased capital investment is financed by way of cfcr and borrowing)

2016/17

£1.01

2017/18

£1.35

2018/19

£0.15

2019/20

£0

2020/21

£0

Councillor Yuill moved as an amendment, seconded by Councillor Malone:-

That the Council -

(1) set a revenue budget for 2016/17 as below;

(2) note the net movement between appendix 1 and appendix 2 of the report of £3.39million amended as below;

(3) approve the Non-Housing Capital Programme amended as below;

(4) agree to the conditions of the Local Government Finance Settlement for 2016/17 in so far as it is within its legal powers to do so (further details are given in paragraph 5.5 of the report);

(5) approve the recommended use of reserves which specifically includes a Risk Fund and non-earmarked reserves;

(6) approve the Prudential Indicators as below;

(7) approve the transfer payment to Visit Aberdeenshire, being the new organisation replacing Visit Aberdeen;

(9) approve the level of funding for 2016/17 in relation to Integration Joint Board as per appendix 9 to the report;

(10) note that once again, Aberdeen City Council has received the lowest level of Scottish Government funding per citizen in all Scotland;

(11) deplore the decision by the Scottish Government to impose in 2016/17 cuts on Aberdeen City Council of £10.3million and on local government in Scotland as a whole of £336million;

(12) note that the Scottish Government could have chosen to fund additional investment in Scottish public services by varying the rate of income tax but that it has chosen not to do this;

(13) deplore the Scottish Government’s continuing centralisation agenda which has in many cases effectively removed from local councils the ability to make decisions based upon the priorities of the citizens and communities they serve;

(14) instruct the Chief Executive to begin immediately the 2017/18 budget process including a full review of all Council activities and services to identify new ways of working which make the most efficient use of Council resources;

(15) instruct the Chief Executive to create a £1million Transformation Fund from the projected year end balances and report back to the Finance, Policy and Resources Committee with details of how this fund will be invested;

(16) instruct the Director of Education and Children’s Services to report to the Education and Children’s Services Committee on how best to utilise the Education Fund to improve the education of Aberdeen’s children; and

(17) instruct the Director of Communities, Housing and Infrastructure to report to the appropriate committee on the implementation of an energy saving financial incentive scheme for leased community centre management committees.

Liberal Democrats Budget Proposals
		£000	£000
Deficit per Council Report			2,403

Appendix 1 (Cost Pressures Identified and reviewed for 2016/17 Budget Papers)
	Fully Accepted
Appendix 2 (Adjustments not requiring Committee Approval)
	Remove Sports Grants Saving		20
Appendix 3 (Adjustments requiring Committee Approval)
	As below

Ref No	COMMUNITIES, HOUSING & INFRASTRUCTURE
1	Across the city wherever possible sponsorship is sought to pay for summer planting. This reduction would see aspects such as the Town House window boxes etc. being reduced.	(10)
2	Pets Corner will receive capital investment to improve the facilities provided and with a new educational space becoming available an income target would be set to generate additional funds.	(2)
3	Extend Pilot Stay On Site Approach to S1 Lunches at two of the council’s Academies and encourage healthy eating.	(50)
4	FM Contract Management Fees for NHS Grampian & NHS Highland could be increased.	(3)
5	Review Street Occupation Charges with a view to increasing the charges to utility companies.	(100)
6	As the council is currently negotiating a City Region Deal it would be possible to reduce the funding to Opportunities North East (ONE) by 50% through reviewing and re-evaluating strategies and funding levels.	(70)
7	By undertaking a review of transport demands from Social Care & Education facilities it would be possible for the expansion of the in-house fleet to replace the contracts currently delivered by external providers.	(25)
8	Review All Environmental Health & Trading Standards Charges and to increase them broadly in line with inflation each year where the charges are not set by statute.	(5)
	TOTAL FOR COMMUNITIES, HOUSING & INFRASTRUCTURE		(265)

	CORPORATE GOVERNANCE
9	The Council has a duct infrastructure which runs CCTV and intelligent transport links. Spare capacity can therefore be sold to the private sector.	(72)
10	Registrars; review of service offerings & joint promotion with Aberdeenshire as well as an anticipated increase in the National Wedding Fee and individual citizenship ceremony fee will result in higher income.	(35)
	TOTAL FOR CORPORATE GOVERNANCE		(107)

	Balance Carried Forward		2,051

		£000	£000
	Balance Brought Forward		2,051

Ref No	EDUCATION & CHILDREN'S SERVICES
11	This option is a reduction in funding to Sport Aberdeen. The Council would work with Sport Aberdeen to determine the proposals to manage this reduction.	(250)
12	This option is a reduction of 2% funding to Aberdeen Sports Village (ASV). The Council would work with ASV to determine the proposals to manage this reduction.	(20)
13	A review of the cultural programme is proposed in order to identify opportunities to reduce costs and/or bring about greater efficiencies in the services provided to third parties.	(300)
14	A review of the Service Level Agreement with NHS Grampian regarding the provision of Speech & Language Therapy services would allow a reduction in costs depending on the level of service being purchased.	(100)
15	This option extends the review of Admin and Supplies Budgets to Schools and would result in a small reduction in the level of DEM budget available for schools in 2016/17.	(140)
16	Arising from the implementation of the inclusion review, pupils with Additional Support Needs will be educated at their local schools. This will reduce the number of children requiring transport and therefore the number of escorts required over a 5 year period.	(20)
17	The secondary teaching staffing formulae is weighted to allow for S1 and S2 classes in Maths and English to be set at a maximum of 20. Since 2010/11 schools were no longer required to do this and are therefore free to divert these resources to other areas.	(440)
18	At present children with Additional Support Needs are currently transported to school by taxi. This proposal would be to encourage parents to take the child to school, which provides the child with a familiar environment during the journey, and to pay parents a mileage allowance.	0
	TOTAL FOR EDUCATION & CHILDREN'S SERVICES		(1,270)

	INTEGRATION JOINT BOARD
19	Saving on management and infrastructure costs of Bon Accord Care in line with those applied to other services for 2016/17 e.g. vacancy factor increase, reduction in energy consumption, overtime budget reduction etc.	(250)
20	Comprehensive review of the current service delivery model through Bon Accord Care. The Council would work with Bon Accord Care to determine the proposals to manage this reduction.	(450)
	TOTAL FOR INTEGRATION JOINT BOARD		(700)

	TRADING
21	Review of apprenticeship scheme within Building Services to improve quality of training and maximise and secure future supply of 'home grown' trade qualified staff.	(400)
22	Review of Parking Permit Charges (Business Permits) - raise by £50 each year ONE YEAR ONLY	(10)
23	Review of Parking Permit Charges (Contractor Permits) - raise by £55 each year ONE YEAR ONLY	(32)
24	Convert Frederick Street Car Park to long stay and introduce permits for improved commercial use of Council asset.	0
	TOTAL TRADING		(442)

	Balance Carried Forward		(361)

		£000	£000
	Balance Brought Forward		(361)
Additional Savings
	Communities, Housing & Infrastructure
	Removal of energy saving @ 10% for community centres	35
	Energy saving @ 15% for community centres	(52)
	Leased community centre energy saving incentive scheme	26
	More efficient deployment of City Wardens	(200)
	Adjustment to street occupation charges (30% not 21%)	(43)

	Trading
	Review of Parking Permit Charges (Monthly Permits) - raise the annual charge to £300 to generate more income from commercial users.	(160)

	Corporate
	Increase vacancy factor to 8.5% (not Education or Social Care)	(400)

	Total New Savings		(794)

New Initiatives
	Education & Children's Services
	Education Fund (including £440K from line 17 above)	600

	Communities, Housing & Infrastructure
	Supported bus services	200
	Install additional bus shelters	50
	Small scale environmental improvements fund	37
	Additional street trees and street tree maintenance	50
	Increased winter maintenance & road response team capacity	170

	Corporate
	Finance additional borrowing	48

	Total New Initiatives		1,155

	Revised (Surplus)/Deficit		0

Liberal Democrats Non-Housing Capital Budget Proposals

		Budget	Budget	Budget	Budget	Budget	Total
Non-Housing Capital Programme		2016/17	2017/18	2018/19	2019/20	2020/21
		£'000	£'000	£'000	£'000	£'000	£'000

	Original Budget Per Appendix 6	157,458	161,873	69,916	62,201	65,475	516,923

	Add:
	Additional investment in roads/pavement resurfacing and repairs and street lighting renewal	2,000					2,000
	Multi-use Winter Maintenance & Response Plant	120
	New Budget	159,578	161,873	69,916	62,201	65,475	519,043

	Additional Cost	2,120	0	0	0	0	2,120

	Funded By: Additional Borrowing	(2,120)	0	0	0	0	(2,120)

ABERDEEN CITY COUNCIL

2015/16 to 2020/21

THE PRUDENTIAL CODE

For Capital Finance in Local Authorities

From 1 April 2004, Councils are required by Regulation to have regard to the Prudential Code (the Code) when carrying out their duties under Part 7 of the Local Government in Scotland Act 2003.

The key objectives of the Code are to ensure:-

· The Council’s capital programmes are affordable, prudent and sustainable.

· Treasury management decisions are taken in accordance with good professional practice.

The Code also has the objectives of being consistent with and supporting local strategic planning, local asset management planning and proper option appraisal.

The Code requires the following Prudential Indicators are set for the Council:-

Capital Expenditure

Non HRA

HRA

2014/15

£’000

Actual

57,923

39,295

2015/16

£’000

Estimate

91,776

55,329

2016/17

£’000

Estimate

159,458

48,084

2017/18

£’000

Estimate

161,873

58,077

2018/19

£’000

Estimate

69,916

59,358

2019/20

£’000

Estimate

62,201

60,269

2020/21

£’000

Estimate

65,475

61,141

Ratio of Financing Costs to Net Revenue Stream

Non HRA

HRA

2014/15

Actual

6.3%

15.7%

2015/16

Estimate

6.3%

15.5%

2016/17

Estimate

6.9%

16.8%

2017/18

Estimate

7.2%

17.6%

2018/19

Estimate

7.7%

18.5%

2019/20

Estimate

8.1%

18.1%

2020/21

Estimate

8.3%

17.5%

Capital Financing Requirement

Non HRA

HRA

Total

2014/15

£’000

Actual

486,619

228,997

715,616

2015/16

£’000

Estimate

497,292

254,703

751,995

2016/17

£’000

Estimate

518,578

272,714

791,292

2017/18

£’000

Estimate

572,115

299,451

871,566

2018/19

£’000

Estimate

589,002

325,760

914,762

2019/20

£’000

Estimate

586,493

350,796

937,289

2020/21

£’000

Estimate

584,965

374,372

959,337

The Prudential Code states:

Authorised Limit for External Debt

Operational Boundary

10% Margin

Total

2015/16

£’000

770,154

77,015

847,169

2016/17

£’000

809,451

80,945

890,396

2017/18

£’000

889,725

88,972

978,697

2018/19

£’000

932,921

93,292

1,026,213

2019/20

£’000

955,448

95,545

1,050,993

2020/21

£’000

977,496

97,750

1,075,245

Operational Boundary for External Debt

Borrowing

Other Long Term Liabilities

Total

2015/16

£’000

664,091

106,063

770,154

2016/17

£’000

705,566

103,585

809,151

2017/18

£’000

788,751

100,974

889,725

2018/19

£’000

835,169

97,752

932,921

2019/20

£’000

860,693

94,755

955,448

2020/21

£’000

884,535

92,961

977,496

The estimate of the incremental impact of capital investment decisions proposed in the report, over and above capital investment decisions that have previously been taken by the Council are:

(a) for Band D Council Tax

2016/17

£0

2017/18

£0

2018/19

£0

2019/20

£0

2020/21

£0

(b) for average weekly housing rents (assuming that increased capital investment is financed by way of cfcr and borrowing)

2016/17

£1.01

2017/18

£1.35

2018/19

£0.15

2019/20

£0

2020/21

£0

Councillor Jackie Dunbar moved as a further amendment, seconded by Councillor Cameron:-

That the Council -

(1) set a revenue budget for 2016/17 as below;

(2) note the net movement between appendix 1 and appendix 2 of the report of £3.39million amended as below;

(3) approve the Non-Housing Capital Programme as below and instruct officers to report back with full costs on suitable sites and timeline for delivery including full costs (land acquisition/demolition/land assessment) for the following projects:

· Tillydrone Community School;

· Torry Primary School; and

· Council housing;

(4) agree to the conditions of the Local Government Finance Settlement for 2016/17 in so far as it is within its legal powers to do so (further details are given in paragraph 5.5 of the report);

(5) approve the recommended use and level of reserves as below;

(6) approve the Prudential Indicators as below;

(7) approve the transfer payment to Visit Aberdeenshire, being the new organisation replacing Visit Aberdeen;

(9) approve the level of funding for 2016/17 in relation to the Integration Joint Board as per appendix 9 to the report; and

(10) instruct the Chief Executive to report back to the relevant committee on how individual administration budgets (such as photocopying, stationery and postage costs) could be allocated on a Councillor basis.

Scottish National Party Budget Proposals
			£000		£000
Deficit per Council Report					2,403

Appendix 1 (Cost Pressures Identified and reviewed for 2016/17 Budget Papers)
	Reinstate Surface Dressing		160
	Reinstate Pothole Patching		133
	Reinstate Repairs to Collapsed Gullies		207
	Remove Pricing Policy for Residents Permits		(150)
					350
Appendix 2 (Adjustments not requiring Committee Approval)
	Fully Accepted
Appendix 3 (Adjustments requiring Committee Approval)
	As Below

Ref No	COMMUNITIES, HOUSING & INFRASTRUCTURE
1	Increase Burial Fees annually over the next 5 years by 8.5% per annum. ONE YEAR ONLY		(33)
2	In 2013/14 £141,000 budget allocation was made to increase the grounds maintenance in cemeteries. This would mean that the allowance was removed resulting in a return to the previous level of service provision. SAVING FIGURE RESTRICTED TO ALLOW THE REPAIR OF SUNKEN LAIRS INITIATIVE TO CONTINUE (£32k).		(59)
3	In 2013/14 an additional budget allocation was made to grass cutting to increase the number of grass cuts as appropriate across the city. This option would see the number of cuts reduced.		(250)
4	Across the city wherever possible sponsorship is sought to pay for summer planting. This reduction would see aspects such as the Town House window boxes etc. being reduced.		(10)
5	Extend Pilot Stay On Site Approach to S1 Lunches at two of the council’s Academies and encourage healthy eating. AMEND TO ALL SECONDARIES.		(275)
6	FM Contract Management Fees for NHS Grampian & NHS Highland could be increased.		(3)
7	Review Street Occupation Charges with a view to increasing the charges to utility companies.		(100)
8	As the Council is currently negotiating a City Region Deal it would be possible to reduce the funding to Opportunities North East (ONE) by 50% through reviewing and re-evaluating strategies and funding levels		(70)
9	By undertaking a review of transport demands from Social Care & Education facilities it would be possible for the expansion of the in-house fleet to replace the contracts currently delivered by external providers.		(25)
10	Review All Environmental Health & Trading Standards Charges and to increase them broadly in line with inflation each year where the charges are not set by statute.		(5)
	TOTAL FOR COMMUNITIES, HOUSING & INFRASTRUCTURE				(830)

	CORPORATE GOVERNANCE
11	The Council has a duct infrastructure which runs CCTV and intelligent transport links. Spare capacity can therefore be sold to the private sector.		(72)
12	Registrars; review of service offerings & joint promotion with Aberdeenshire as well as an anticipated increase in the National Wedding Fee and individual citizenship ceremony fee will result in higher income.		(35)
	TOTAL FOR CORPORATE GOVERNANCE				(107)

	Balance Carried Forward				1,816

			£000		£000
	Balance Brought Forward				1,816

Ref No	EDUCATION & CHILDREN'S SERVICES
13	This option is a reduction in funding to Sport Aberdeen. The Council would work with Sport Aberdeen to determine the proposals to manage this reduction.		(405)
14	This option is a reduction of 2% funding to Aberdeen Sports Village (ASV). The Council would work with ASV to determine the proposals to manage this reduction.		(20)
15	A review of the cultural programme is proposed in order to identify opportunities to reduce costs and/or bring about greater efficiencies in the services provided to third parties.		(640)
16	A review of the Service Level Agreement with NHS Grampian regarding the provision of Speech & Language Therapy services would allow a reduction in costs depending on the level of service being purchased.		(100)
17	This option extends the review of Admin and Supplies Budgets to Schools and would result in a small reduction in the level of DEM budget available for schools in 2016/17.		(280)
18	Arising from the implementation of the inclusion review, pupils with Additional Support Needs will be educated at their local schools. This will reduce the number of children requiring transport and therefore the number of escorts required over a 5 year period.		(20)
19	The secondary teaching staffing formulae is weighted to allow for S1 and S2 classes in Maths and English to be set at a maximum of 20. Since 2010/11 schools were no longer required to do this and are therefore free to divert these resources to other areas.		(440)
20	At present children with Additional Support Needs are currently transported to school by taxi. This proposal would be to encourage parents to take the child to school, which provides the child with a familiar environment during the journey, and to pay parents a mileage allowance.		(5)
	TOTAL FOR EDUCATION & CHILDREN'S SERVICES				(1,910)

	INTEGRATION JOINT BOARD
21	Saving on management and infrastructure costs of Bon Accord Care in line with those applied to other services for 2016/17 e.g. vacancy factor increase, reduction in energy consumption, overtime budget reduction etc.		(250)
22	Comprehensive review of the current service delivery model through Bon Accord Care. The Council would work with Bon Accord Care to determine the proposals to manage this reduction.		(450)
	TOTAL FOR INTEGRATION JOINT BOARD				(700)

	Balance Carried Forward				(794)

			£000		£000
	Balance Brought Forward				(794)

	TRADING
23	Review of apprenticeship scheme within Building Services to improve quality of training and maximise and secure future supply of 'home grown' trade qualified staff.		(400)
24	Review of Parking Permit Charges (Business Permits) - raise by £50 each year ONE YEAR ONLY AT THIS TIME BUT WILL BE REVIEWED ANNUALLY		(10)
25	Review of Parking Permit Charges (Contractor Permits) - raise by £55 each year ONE YEAR ONLY AT THIS TIME BUT WILL BE REVIEWED ANNUALLY.		(32)
26	Review of Parking Permit Charges (Monthly Permits) - raise by £20 each year (to £230 in Year 1) to generate more income from commercial users.		(75)
27	Review of Parking Permit Charges (Residents Second Permits) - raise by £5 each year (to £125 in Year 1) for increased income for the Council. AMENDED - FOR ONE YEAR ONLY		(5)
28	Review of Parking Charges in City Centre Parking Zones A, B, C, E, F & G (£2 up to 30 mins, £4 up to 1 hr, £6 up to 2 hrs - discounted to £5 for 6-8pm) to improve turnover of parking and increase income. AMENDED TO £1 UP TO 30 MINS; £3 UP TO AN HOUR ; £6 UP TO 2 HOURS - DISCOUNTED TO £5 FOR 6-8PM		(95)
29	Review of Parking Charges in Chapel Street and Denburn Multi Story Car Parks (Raise all tariffs by £1) and West North Street Multi Story Car Park (Reduce all tariffs by 50p) for improved commercial use of Council assets.		(250)
30	Review of Parking Charges in Summer Street and Greyfriars Surface Car Parks (Raise to £2.50 for 2 hrs, £3.50 for 3 hrs, £4.50 for 4 hrs) for improved commercial use of Council assets.		(30)
	TOTAL TRADING				(897)

	Balance Carried Forward				(1,691)

			£000		£000
	Balance Brought Forward				(1,691)

Additional Savings

		5% reduction in Special Responsibility Allowances	(7)
		Charge of £250 per Councillor parking space	(11)
		Return cost of resident's first permit to £80	(300)

		Total New Savings		(318)

New Initiatives
		Use of bus lane enforcement reserve for subsidising bus routes with a clear social need and to help enable a circular route for the City.	100
		Cover for officer time to support Rubislaw Quarry Aberdeen Ltd in their bid to secure funding from other sources	20

		Total New Initiatives		120


Appendix 4 Use of Reserves
		Accept Officer's Recommendations	(2,794)
		Remove:
		Hazlehead Pets Corner	(100)
		De-Risk the Council	(2,872)
		Bus Lane Enforcement	(100)
		Welfare Reform	(2,000)
		Financial Risk Fund	(2,002)
		Second/Long Term Empty Homes	(4,400)
				(14,268)
		Add:
		Fund to include Fairer Aberdeen Fund, Scottish Welfare Fund and Discretionary Housing Payments	2,000
				2,000


		Transfer to Non-Housing Capital Programme		14,157

		Revised (Surplus) / Deficit		0

Scottish National Party Non-Housing Capital Budget Proposals

		Budget	Budget	Budget	Budget	Budget	Total
Non-Housing Capital Programme		2016/17	2017/18	2018/19	2019/20	2020/21
		£'000	£'000	£'000	£'000	£'000	£'000

	Original Budget Per Appendix 6	157,458	161,873	69,916	62,201	65,475	516,923

	Remove:
	Tillydrone Community Hub	(600)	(2,400)	(500)			(3,500)
	Defer Milltimber Primary School			(500)	(11,000)	(1,500)	(13,000)
	Condition and Suitability Programme	(1,743)	(1,000)				(2,743)

	Add:
	Tillydrone Community School (Note 1)	1,000	12,000	3,000			16,000
	Torry Primary School (Note 2)	700	1,000	8,000	3,300		13,000
	Council Housing (Note 3)		2,200	2,200			4,400
	New Budget	156,815	173,673	82,116	54,501	63,975	531,080

	Additional Cost	(643)	11,800	12,200	(7,700)	(1,500)	14,157

	Funded By: Transfer from/to Capital Reserves	643	(11,800)	(12,200)	7,700	1,500	(14,157)


	Note 1:
	This is for a Two Stream Primary School plus a Community Hub

	Note 2:
	This is for a Two Stream Primary School

	Note 3:
	The £4.4 million will allow for 37 one-bedroom flats to be built

	Please note: these costs represent a new build and exclude land acquisition, demolition and other associated costs

ABERDEEN CITY COUNCIL

2015/16 to 2020/21

THE PRUDENTIAL CODE

For Capital Finance in Local Authorities

From 1 April 2004, Councils are required by Regulation to have regard to the Prudential Code (the Code) when carrying out their duties under Part 7 of the Local Government in Scotland Act 2003.

The key objectives of the Code are to ensure:-

· The Council’s capital programmes are affordable, prudent and sustainable.

· Treasury management decisions are taken in accordance with good professional practice.

The Code also has the objectives of being consistent with and supporting local strategic planning, local asset management planning and proper option appraisal.

The Code requires the following Prudential Indicators are set for the Council:-

Capital Expenditure

Non HRA

HRA

2014/15

£’000

Actual

57,923

39,295

2015/16

£’000

Estimate

91,776

55,329

2016/17

£’000

Estimate

156,815

48,084

2017/18

£’000

Estimate

173,673

58,077

2018/19

£’000

Estimate

82,116

59,358

2019/20

£’000

Estimate

54,501

60,269

2020/21

£’000

Estimate

63,975

61,141

Ratio of Financing Costs to Net Revenue Stream

Non HRA

HRA

2014/15

Actual

6.3%

15.7%

2015/16

Estimate

6.3%

15.5%

2016/17

Estimate

6.9%

16.8%

2017/18

Estimate

7.2%

17.6%

2018/19

Estimate

7.7%

18.5%

2019/20

Estimate

8.1%

18.1%

2020/21

Estimate

8.3%

17.5%

Capital Financing Requirement

Non HRA

HRA

Total

2014/15

£’000

Actual

486,619

228,997

715,616

2015/16

£’000

Estimate

497,292

254,703

751,995

2016/17

£’000

Estimate

516,578

272,714

789,292

2017/18

£’000

Estimate

570,115

299,451

869,566

2018/19

£’000

Estimate

587,002

325,760

912,762

2019/20

£’000

Estimate

584,493

350,796

935,289

2020/21

£’000

Estimate

582,965

374,372

957,337

The Prudential Code states:

Authorised Limit for External Debt

Operational Boundary

10% Margin

Total

2015/16

£’000

770,154

77,015

847,169

2016/17

£’000

807,451

80,745

888,196

2017/18

£’000

887,725

88,972

976,497

2018/19

£’000

930,921

93,092

1,024,013

2019/20

£’000

953,448

95,345

1,048,793

2020/21

£’000

975,496

97,750

1,073,046

Operational Boundary for External Debt

Borrowing

Other Long Term Liabilities

Total

2015/16

£’000

664,091

106,063

770,154

2016/17

£’000

705,866

103,585

807,451

2017/18

£’000

786,751

100,974

887,725

2018/19

£’000

833,169

97,752

930,921

2019/20

£’000

858,693

94,755

953,448

2020/21

£’000

882,535

92,961

975,496

The estimate of the incremental impact of capital investment decisions proposed in the report, over and above capital investment decisions that have previously been taken by the Council are:

(a) for Band D Council Tax

2016/17

£0

2017/18

£0

2018/19

£0

2019/20

£0

2020/21

£0

(b) for average weekly housing rents (assuming that increased capital investment is financed by way of cfcr and borrowing)

2016/17

£1.01

2017/18

£1.35

2018/19

£0.15

2019/20

£0

2020/21

£0

During the course of summing up, Councillor Jackie Dunbar agreed to incorporate parts 11 to 15 of the motion into her amendment, and this was accepted.

There being a motion and two amendments, the Council first divided between the amendment by Councillor Yuill and the amendment by Councillor Jackie Dunbar.

On a division, there voted:-

For the amendment by Councillor Yuill (4) - Councillors Greig, Malone, Jennifer Stewart and Yuill.

For the amendment by Councillor Jackie Dunbar (14) - Councillors Cameron, Copland, Dickson, Jackie Dunbar, Flynn, Hutchison, Jaffrey, Kiddie, MacGregor, Nicoll, Noble, Samarai, Sandy Stuart and Townson.

Declined to vote (22) - Lord Provost; Depute Provost; and Councillors Allan, Boulton, Carle, Cooney, Crockett, Donnelly, Lesley Dunbar, Finlayson, Graham, Grant, Ironside, Laing, Lawrence, Malik, Milne, Jean Morrison, Nathan Morrison, Taylor, Thomson and Young.

The Council then divided between the motion and the amendment by Councillor Jackie Dunbar.

On a division, there voted:-

For the motion (22) - Lord Provost; Depute Provost; and Councillors Allan, Boulton, Carle, Cooney, Crockett, Donnelly, Lesley Dunbar, Finlayson, Graham, Grant, Ironside, Laing, Lawrence, Malik, Milne, Jean Morrison, Nathan Morrison, Taylor, Thomson and Young.

Declined to vote (4) - Councillors Greig, Malone, Jennifer Stewart and Yuill.

The Council resolved:-

to adopt the motion.

Supporting documents:

Related Links

Agenda item

General Fund Revenue Budget 2016/17 and Non-Housing Capital Programme 2016/17 to 2020/21 - CG/16/018

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