Agenda item

Members to receive a report setting out the proposed Precept  for financial year 2023-24 and the Medium Term Financial Plan (MTFP).

 

Members will be asked to comment and note the information presented in the report.

 

Members will be asked to support the proposal to increase the 2023-24 Precept by £15.00 per annum (5.81%) for police purposes to £273.23 for a Band D property.

Members of the panel received a report setting out the proposed pre-cept for the financial year 2023-24 together with information about the budget for the force and OPCC, the capital programme, the treasury management strategy and the medium term financial plan (MTFP).

 

The Police and Crime Commissioner (PCC) introduced the report setting out the Leicester, Leicestershire & Rutland context regarding policing the area and the history in relation to previous funding as well as external factors increasing budget pressures and the driving demands impacting on policing.

 

It was noted that:

·         the nationally-set pay agreement for the Police officers and Police Staff had put significant pressure on the Force budget,

·         the PCC was maintaining a cautious approach and there were no plans to increase officer numbers beyond the establishment figure of 2242 at this time,

·         the budget was focussed on the priorities within the Police and Crime Plan with strong links to the Force Target Operating Model (TOM),

·         the PCC had offered residents an opportunity through a survey to give their views on the proposed increase to precept and received 2172 responses with 50.3% of respondents supportive of a £15.00 per annum precept increase on a Band D property,

·         the PCC recommended that the precept be increased by £15.00 per annum on a Band D property for 2023-24 in line with Home Office assumptions.

 

The Chief Constable addressed the panel, confirming that the PCC had sought his views about the budget and the challenges faced. 

 

The Chief Constable referred to the professional advice he’d given as described in the Policing Protocol Order 2011 and his financial report submitted to the OPCC governance board which gave a broader context to the fiscal position of the force and showed the rapid shift in position over the past 12 months. It was noted that demand on policing had increased 20%, the population of the force area had increased by 10% and the changing demographics of the area brought additional complexities in community policing.

 

Attention was drawn to the headline budget pressures namely: unfunded pay awards, IT contractual inflation; Insurance; Utilities; Vehicle Fuel and other pressures such as an increase in officer overtime which had materialised in-year leading to a £9.9 million unexpected increase in cost and leaving a budget deficit for 2023-2024 of £5.8 million.

 

The Chief Constable expanded on the issue of the unfunded pay awards, giving detail of how that averaged out and applied across ranks and the deficit arising because the government grant uplift was only for officers not for all staff.

 

The Chief Constable set out the steps being taken to help close the deficit gap of £5.8million next year which would include reducing police staff through vacancy management and maintaining officer numbers at 2242. It was anticipated that some estimates about fuel and inflation costs may come down too. It was noted that the PCC had allocated a £620,000 contribution to force reserves to ease the budget pressures.

 

The Chief Constable indicated his support to increase the precept on a Band D property by £15.00 although he put on record that he felt the level of core funding was still significantly short and the pre-cept made up the majority of funding for the force area and that increased inequalities.

 

The Acting Chief Financial Officer, OPCC addressed the panel, providing a summary of the planning process, the risks and challenges for this budget and the precept proposals.

 

Attention was drawn to the following points within the report:

·         The provisional settlement confirmed a £0.3m increase in revenue grant funding and the precept referendum threshold was confirmed at £15 for a Band D property.

 

·         The total 2023-24 net budget requirement of £230.186m.

 

·         A council tax (precept) requirement for 2023-24 of £92.972m.

 

·         A transfer from the Budget Equalisation Reserve (BER) to help reduce the budget deficit, with a view to longer term sustainability.

 

·         The use of the BER to fund an additional 1% (£1.1m) pay award costs for Police Officers and Police Staff if the pay award is above the 2% assumption included within the medium term financial plan (MTFP).

 

·         Transfer of £0.6m from the Office of the Police and Crime Commissioner reserve to the Force in order to support them in reducing the budget deficit and managing the financial challenge.

 

·         Investment items totalling £2.239m contained within the budget proposals for 2023-24 and beyond.

 

·         The review of reserve levels and plans to use reserves to support the medium term financial plan during a period of transition to a sustainable position.

 

·         The amount of funding for the OPCC including commissioning equates to 2.7% of the total net budget with the remaining 97.3% allocated to the Chief Constable to use on local policing and regional collaboration.

 

The Chair thanked the PCC, Chief Constable, and Acting Financial Officer for presenting the budget details noting the rising cost of living was affecting every organisation in the public sector and, commenting that the need to raise the pre-cept in this time was not a pleasant task.

 

Members considered the report and the precept proposals.

 

In relation to increasing demands on policing it was noted the volume of 999 versus 101 calls showed a significant increase in calls and members were curious as to the reason for that when there had been successive years of promoting 101. Members were advised that officers were exploring the reasons behind the increased number of 999 calls and also performance of 101 call handling and there was some suggestion that staffing levels at the call centre may have had some impact on 101 performances as there had been issues recruiting to fill vacancies.

 

Members noted the deficit forecast and considered the medium term financial plans and there was some caution about using reserves to support future pay awards as it was possible that future pay reviews could be higher than anticipated and once reserves were used then future precept proposals would need to be lifted higher. In relation to the budget forecast, it was suggested that rather than using an assumption of a future £10 precept increase it should be £15 to close the deficit quicker.

 

The Acting CFO responded that a risk based approach had been taken working with information that was available in this year’s Home Office settlement.

 

There was some support for forecasting forward on a £15 precept increase although recognised there was volatility to that and there was no guarantee that the Home Office settlement would allow for that level.

 

Members expressed concern about the level of core funding being received and the impact that had on the precept level being raised. Members noted that the report showed a clear shift in funding away from central grants with income now standing at just over 56% from the local precept and it was suggested there was a strong case to say that the Leicester, Leicestershire, and Rutland force area should be getting more funding.

 

The Panel agreed that the Chair on behalf of the panel should write to the Policing Minister about their core funding concerns and request support for a £15 increase in precept moving forward.

 

Members noted that the proposal to increase this year’s precept by £15 on a Band D property represented an increase as a whole of 5.81%.  There was a brief discussion about the allocation of the extra revenue generated together with the plans to achieve efficiency savings and how the impact of £3.9 million savings would be assessed. The Chief Constable indicated that a number of options would be explored as set out in the report and steps were being taken to methodically look at unproductive areas. Assurance was given that the force would continue to deliver a high rate service and to have the resources to tackle important issues such as rural crime and county lines and they would look to minimalize the impact.

 

There was further discussion about the possibility of reducing police staff by up to 8% and clarity was sought as regards the staffing levels at the OPCC and whether there was any expectation to make savings there too.

 

The PCC informed that the percentage of budget allocated to the OPCC remained static. Money was not being taken away from the police and the proportional split between the OPCC and police remained as it was the past few years. In addition, the OPCC were giving a contribution of £620,000 to address the deficit issue that had arisen.

 

It was noted that the pressures on the budget brought about by applying the pay increases applied across the board to OPCC staff too but there was no increase in the OPCC budget to meet that. As far as reversal of workforce modernisation was concerned this was about exploring what roles could be changed and re-evaluating unproductive areas to make savings.

 

The PCC confirmed that any proposals to reduce staff and the impact of that would be handled through the OPCC Corporate Governance Board as too would any other efficiency savings proposals, before being brought to the panel for information too.

 

The Chair remarked upon the costs of the OPCC, noting it was not apparent from the report that any efficiency savings were happening in the OPCC and asked for information of what was happening there too.

 

During the course of discussion, it was suggested that in the next fiscal year the OPCC should look to match or improve upon the efficiency savings it was asking of the police. It was also suggested that the budget savings might be further off set if further consideration was given to removing the post of Deputy Police and Crime Commissioner.

 

The Monitoring Officer provided a point of clarification about the noting of the report, advising it was convention to invite the panel to note the report. The Monitoring Officer also advised that the only decision the panel were invited to make today was to support the precept proposal and there was a distinction between that and the budget.  The Monitoring Officer informed the panel of the three options available to them i) support the pre-cept without qualification or comment, ii) support the precept with recommendations, iii) veto which would require 10 out of 15 member votes.

 

In respect of s106 monies the Chief Constable acknowledged the work done by the panel and the recommendations that followed that piece of work. He advised that it was still too soon to factor in those sums of money to a capital programme, but work was ongoing to repurpose existing bids and a full update would come to the panel in due course.

 

Regarding HR services, it was noted there was still a shared service centre with Derbyshire as well as a small HR recruitment team in force, consideration was being given to move the HR service in force as part of the workforce wellbeing agenda, this would help address some of the challenges, enhance reactive therapeutic support to officers and enable moves towards preventative work too.  Members welcomed the force prioritising investment in staffing therapeutic support, health, and wellbeing.

 

In terms of officer numbers being maintained at 2242, it was advised that forecast projections included some safeguarding for retirement age, and the force were able to project forward for the next few years with recruitment forecast next year at 147 officers for example. There was also the challenge of recruitment/churn and bringing in wider representation whilst ensuring that recruitment was aligned to skills and demographic.

 

It was proposed and seconded and upon being put to the vote unanimously supported that the pre-cept be increased to £15 for a Band D property.

 

The Chair thanked everyone for their contribution to discussion.

 

RESOLVED:

1.    That the information presented in the report be noted;

2.    That the proposal to increase the 2023-24 precept by £15.00 per annum (5.81%) for police purposes to £273.23 for a Band D property be supported;

3.    That the Chair on behalf of the panel shall write to the Policing Minister about the core funding concerns and request support for a £15 increase in precept moving forward;

4.    That the PCC shall provide a full report detailing the Efficiency Savings identified for the financial year 2023-34 and the impact of those efficiency savings to a future panel meeting;

5.    That the future risks, challenges, uncertainties, and opportunities included in the precept proposal together with the financial and operational considerations identified be noted;

6.    That the Home Office grant allocations notified through the provisional settlement and the Band D council tax base and estimated collection fund deficit received from the billing authorities be noted;

7.    The current Medium Term Financial Plan (MTFP) contained in Appendix 1, the Review of the MTFP Budget Setting 2023-24 at Appendix 2;  Capital Strategy at Appendix 3 and the Treasury Management Strategy at Appendix 4 be noted.