Agenda item

            The Director of Corporate Services submitted the undernoted report which had been prepared in connection with the estimated expenditure of the Council for the year 2009/2010:

 

“Purpose

 

      The purpose of this report is to request the Strategic Policy and Resources Committee to fix the cash limits of the Council’s various committees for 2009/10 and to approve the estimates for the Strategic Policy and Resources Committee for 2009/10.

 

Relevant Background Information

 

      Section 53(2) of the Local Government Act (Northern Ireland) 1972 and Regulation 2 of the Local Government Annual Budget (SR & O 1973 No 130) require that this Council:

 

(a)  consider and approve estimates for the year 2009/2010,

 

(b)authorise the expenditure included in those estimates, and,

 

(c)  fix the amount estimated to be raised by means of a District Rate.

 

      The Council is also required to fix this District Rate not later than 15 February 2009.

 

      The key purposes of agreeing the revenue estimates are as follows:

 

·         To establish what the Council can afford to spend in 2009/10.

 

·         To agree the cash limit for each of the Council’s committees.

 

·         To agree the district rate for 2009/10.

 

·         To ensure that the Council’s money is aligned to deliver the priorities set by Members.

 

      There can be little doubt that preparation of the 2009/10 budget has been the most difficult challenge for many years. The current economic downturn could be the worst for a generation with councils facing a ‘double whammy’ of lower income and higher demand for services. During recent months I have reported to Committee on several occasions on the difficulties which the Council is experiencing with regard to the current year’s budget. Specifically the loss of external income, utility costs, spending on unbudgeted items and loss of investment income are all having a negative influence on our ability to live within budget. These issues, when combined with the ongoing difficulties with Land and Property Services in relation to rate income, have placed the Council in an almost impossible situation with regard to maintaining service delivery but at the same time not placing an unacceptable burden on the ratepayer. It is acknowledged that although District Councils are under considerable stress regional government has responded by freezing the regional rate and providing compensation on capping so that the overall rate increase to the public will be kept to a minimum.

 

      The most up to date information available from Land and Property Services indicates a district rate increase of 8.59% for 2009/10. The table below shows the impact of this recommended increase on average valued property types.

 

PROPERTY		Rates Bill	Rates Bill	Increase in
		2008/09	2009/10	Rate Bill
Domestic Properties		£	£	£
Terrace House		531.34	550.18	18.84
3-Bed Semi-Detached House		812.60	841.41	28.81
4-Bed Detached House		1,806.55	1,870.60	64.05
Apartment		512.61	530.79	18.18

 

      There have been a number of key internal and external drivers for this year’s estimates and these are discussed below.

 

Regional Rate

 

      In 2008/09, the Minister of Finance and Personnel froze the regional rate for domestic ratepayers.  The regional rate will again be frozen for 2009/10 but this time the policy will apply to both domestic and non-domestic ratepayers. 

 

City Investment Strategy

 

      Members have identified that Belfast is now at an important stage of development where a further step change in its fortunes is possible. The Council can help to facilitate and deliver these changes through its vision and leadership and ensuring things happen through allocating a significant level of our resources via the City Investment Strategy. The Director of Corporate Services presented to the Strategic Policy and Resources Committee on 14 December 2007 a cash flow analysis for the City Investment Strategy which could raise £29.0m over three years without recourse to borrowing. As part of this analysis it was recommended that £1.0m should be included in the Estimates for 2008/09 and £2.0m in 2009/10.

 

      The Estimates presented for 2009/10 include an amount of £2.0m. However, economic conditions dictate flexibility in the use of this budget allocation. For this reason I recommend that the budget allocation be used for the following purposes as and when appropriate:

 

·         As a resource for the City Investment Strategy

 

·         As a resource for building up the Council’s reserves as recommended by the Local Government Auditor

 

·         As a contingency to safeguard against uncertainty in the current economic climate.

 

Corporate Thematic Priorities

 

      As part of the corporate planning process Members and Chief Officers have identified a number of cross-cutting priorities which cannot be solely delivered within functional budgets. It is recommended that a corporate strategy budget is established to finance these cross cutting priorities. This budget will be managed by COMT and reported to the Strategic Policy and Resources Committee. A budget of £500,000 is included in the Estimates for this purpose.

 

      The priority areas which will have access to this budget are:

 

·         Safer Belfast

·         Older People

·         Younger People

·         Invest to save

·         Customer Strategy

 

Pay and Pensions

 

      Pay increases for 2009/10 are expected to be close to inflation. However, employer’s contributions for superannuation will rise from 15.0% to 16.0% at a cost of £999,190. 

 

Utility Costs

 

      During 2008/09 the price of oil, gas and electricity has been extremely volatile. High level guidance recommended increases of 25% in oil, 50% in gas and 49% in electricity to provide for escalating utility prices. However, because of the utility price reductions which followed the sharp increases in price, budgets have been revised downwards. Nevertheless, a budget increase of £1,609,120 is included in this year’s estimate.

 

Capital Programme

 

      Capital expenditure financed by loan is forecast to be £22m in 2008/09 and £8m in 2009/10. With existing advances of £11.2m the Council will require an additional £1.1m to finance capital expenditure in 2009/10.

 

General Exchequer Grant

 

      The estimate for 2009/10 is based on Gross Penny Product data at the 30th September 2008. This shows an increase of £205,940 or 5.10% on 2008/09. However, I have been advised by the Department of the Environment that the final estimate for the GEG will not be available until Land and Property Services finalise the estimated penny product figures in January 2009.

 

Allocation of Waste Disposal Fund

 

      Members will be aware that the Waste Disposal finance strategy was put in place to address the issues of escalating waste management costs and the stepped increases forecast to take place between 2006 and 2010. This strategy has enabled an amount of £1.5m to be allocated next year to finance accommodation issues, completion of the Cemeteries Project, corporate human resources issues and the Dargan Road Closure.

 

Efficiency Savings

 

      The Strategic Policy and Resources Committee, at its meeting on 14/11/08, agreed a programme of efficiencies for 2009/10 amounting to £1,762,870. The table below summarises the efficiency programme for 2009/10.

 

Efficiency Programme 2009/10
	£
Insurances	482,000
Personal Computers	105,840
Stationery	128,720
Departmental Contributions 1.       Health and Environmental Services 2.       Core Improvement Team 3.       Development	770,000 200,000 76,310
Total Efficiency Savings	1,762,870

 

      Individual departments have also made efficiency savings over and above those detailed in the above table. These are discussed under the individual committee statements later in this report.

 

      A brief description of each efficiency area is provided below.

 

Insurance

 

      Insurance costs have been reduced from £1,552,000 in 2008/09 to £1,070,000 for 2009/10 – giving a cash saving of £482,000.  This has been achieved by tendering the insurance broker services and several of the Council’s insurance policies.  This resulted in reduced broker and premium costs.

 

Procurement

 

      The Procurement Unit carried out two reverse auctions for stationery and personal computers.  A reverse auction is where suppliers bid on a real time basis for a contract.  These auctions are most effective where a detailed specification can be put together in terms of volume and quality.  The savings achieved for these two auctions amount to £128,720 for stationery and £105,840 for personal computers.

 

Departmental Contributions

 

      Four departments have provided estimates for 2009/10 which in real terms show net expenditure savings.  These are:

 

Health & Environmental Services - £770,000. These savings have been produced in the budget areas of employee costs, activity-based modelling of landfill contract costs, segregated waste and compensation claims.

 

CIT - £200,000. These savings have been achieved through increased rental income following rent reviews on a number of units in the Council’s industrial estates and a reduction in employee costs.

 

Development - £76,310 in respect of employee cost savings.

 

Product of a 1p Rate

 

      The Estimated Product of a 1p Rate (EPP) shows how much rate income the Council would earn if a rate of 1p was applied to all rateable properties in Belfast. Therefore, the more the city grows the more rate income the Council will receive. Indeed, this has been the case for the past number of years with an average year on year growth of 3%. However, last year saw a change in this trend with the EPP falling by 0.31%. Indications for 2009/10 are not encouraging. The EPP shows a modest increase of 0.80%, however, following intervention by the Finance Minister there may be further adjustment to the EPP in January 2009. Any change to the EPP and consequently the GEG will impact directly on the domestic and non-domestic rate set by BCC. I will update Strategic Policy and Resources Committee on this finalised position and its impact on the district rate at its meeting on the 23rd January 2009.

 

Projected Out-Turn 2008/2009

 

      Members will know that the Budget for the current year is the subject of continuous monitoring of actual spending and income against estimate. As a result of the economic downturn budgets in the current year have had to be revisited and revised. There still remains significant uncertainty and risk around income from fees and charges eg Building Control, Business Improvement Section and Information Services Belfast. Departments are however working hard to ensure that income and expenditure will be contained within budget. It is certain however that these risks will carry on into 2009/10.

 

Key Messages

 

      A communication statement for the rates announcement will be tabled at the Strategic Policy and Resources Committee on the 23rd January 2009.

 

Summary

 

      The figures now presented in this report take account of the above matters.  In summary, the Revenue Estimates for 2009/10, if agreed, will minimise the impact of other financial pressures on the ratepayer, allow Departments to continue to maintain and improve service delivery and at the same time provide sufficient funding for the Council’s City Investment Strategy and other priorities.

 

      In accordance with Standing Orders and Financial Regulations, Chief Officers have submitted to my Department estimates of Income and Expenditure for the year commencing 1 April 2009.  These estimates have been examined in detail by senior staff and myself and a summary of the figures of all Departments, including those under the control of the Strategic Policy and Resources Committee, is set out below and is now submitted to this Committee for consideration and the determination of Committee Cash Limits for the year ending 31 March 2010.

 

Summary of Estimates of Income and Expenditure

for year ending 31 March 2010

 

Year Ending 31/03/2009	COMMITTEE	Year Ending 31/03/2010
£		£
15,364,330	STRATEGIC POLICY AND RESOURCES COMMITTEE	19,146,520
5,590,580	Chief Executive’s Department	5,680,850
215,620	Legal Services Department	254,570
10,406,690	Corporate Services Department	12,189,780
(1,348,560)	Improvement Department	(1,478,680)
(500,000)	Rent Reviews	-
1,000,000	City Investment Fund	2,000,000
-	Corporate Thematic Priorities	500,000
23,796,450	DEVELOPMENT COMMITTEE	24,226,210
30,989,430	PARKS & LEISURE COMMITTEE	33,020,230
47,764,590	HEALTH & ENVIRONMENTAL SERVICES COMMITTEE	49,738,470
31,400	TOWN PLANNING COMMITTEE	30,450
117,946,200		126,161,880
(4,518,050)	Less Adjustments re Capital charges	(3,399,790)
113,428,150		122,762,090
	Less
(4,040,970)	GENERAL EXCHEQUER GRANT
109,387,180
	Less
(2,400,000)	ESTIMATED CREDIT BALANCE
106,987,180
4,822,430	ESTIMATED PRODUCT OF 1p RATE
22.1853p	NON-DOMESTIC RATE IN £ FOR YEAR ENDING 31/3/2010
0.011449	CONVERSION FACTOR
0.2540p	DOMESTIC RATE IN £ YEAR ENDING 31/3/2010

 

      My comments on the spending of the various Committees and their efficiency savings are as follows:

 

Strategic Policy and Resources Committee

 

      A cash limit of £19,146,520 is recommended for the Strategic Policy and Resources Committee in respect of the financial year 2009/10. Excluding capital charges of £3,451,700 this represents an increase in expenditure of £3,782,200.

 

      This is represented by:

 

	£
Chief Executive’s Department	5,680,850
Legal Services Department	254,570
Corporate Services Department	12,189,780
Improvement Department	(1,478,680)
City Investment Fund	2,000,000
Corporate Thematic Priorities	500,000
	19,146,520

 

Chief Executive’s Department

 

      A spending limit of £5,680,850 is recommended for the Chief Executive’s Department for 2009/10. Excluding capital charges of £20,590 this represents an increase of £90,270 or 1.62% over last year.

 

      Employer’s superannuation costs will rise for the fifth successive year throughout the Council.  The employers’ superannuation rate will rise from 15% in 2008/09 to 16.0% in 2009/10.  This has resulted in increased costs of £76,250 for the Department.

 

      The budget provides for the additional post of an Advertising Manager in the Corporate Communications Section. This post has been approved by Committee and will require a further £41,000.

 

      Recent legislative change relating to membership of the District Policing Partnership has resulted in an increase of £21,420 in the DPP budget.

 

The Department has reduced costs in a number of areas. The equipment, tools and materials budget has been reduced by £17,750 to reflect need in 2009/10. A reduction in the conference and approved visits budget of £24,340 reflects, in part, the downward trend in attendance of conferences, by Members, together with a reduction in this aspect for staff accompanying Members.  

 

      The principal area of growth is Peace III for which a budget of £429,180 has been provided. This budget which is for staffing and management costs is 100% funded by SEUPB (Special European Union Programme Body) and will therefore have no impact on the ratepayer.

 

      The Department will make a contribution of £20,850 to the efficiency programme in 2009/10.  Efficiency savings will be made as follows:

 

Efficiencies	£
Insurances	8,230
Personal Computers	6,660
Stationery	5,960
Total Departmental Efficiency Savings	20,850

 

Corporate Services Department

 

      A spending limit of £12,189,780 is recommended for Corporate Services Department for 2009/10.  Excluding capital charges of £3,427,900 this represents an increase of £1,783,100 or 25.55% over last year.

 

      The Department will face some difficult decisions in 2009/10. There are a number of areas where costs will increase significantly, which, when taken with losses in income arising from the current economic situation necessitates a budgetary increase in excess of £1.5m. The main areas of increased expenditure and reduced income are outlined below.

 

      The Department will incur increased employer’s superannuation and utility costs of £222,970 and £178,320 respectively.

 

      The re-opening of the City Hall will result in increased accommodation costs of £739,550. However these additional costs will be offset by accommodation savings of £492,630 generated with the move from Clarendon Dock, Clarendon House, Linenhall Exchange, Scottish Amicable and Callender House.  

 

      The new SAP system includes core financial systems (income, payments and accounting) as well as systems for procurement. These systems will enable the Council both to change the way that it carries out basic processes, making these more efficient, and to establish better control over day to day purchasing. However, the Department will incur additional costs of £249,110 to make the Central Transactions Unit fully operational in 2009/10.

 

      The most difficult issue facing the Department is reflected in the loss of income. Interest on the District Fund is budgeted at £500,000. This is £500,000 less than in 2008/09 and reflects current interest rates.

 

      The Department’s two trading Services both face difficulties in 2009/10 due to the current difficult economic climate. Information Services Belfast (ISB) have budgeted for a loss in external income of £886,400 and the Business Improvement Section has budgeted for a loss of £388,600in external income. It is important that both Services are ‘right sized’ during this coming financial year.

 

      The Department will make a contribution of £127,440 to the efficiency programme in 2009/10 as follows:

 

Efficiencies	£
Insurance	46,400
Personal Computers	39,950
Stationery	41,090
Total Departmental Efficiency Savings	127,440

 

      Apart from matters highlighted above there are no other exceptional items of income or expenditure.

 

Improvement Department

 

      The Improvement Department will make a net surplus of £1,478,680 in 2009/10.  Excluding capital charges this represents an increased surplus of £130,120 or 9.63% over last year on normal activities.

 

      The main budgetary intentions of the Department for next year are set out below:

 

	£
CIT Initiatives	55,460
CIT Operations	2,060,520
Procurement	139,090
Project Management	172,330
Estates Management	(3,906,080)
	(1,478,680)

 

      The Departments improved position is as a result of projected rent reviews being undertaken in relation to the Council’s Industrial Estates. It is anticipated that external income will increase by £263,930, however internal income will fall by £64,170 giving a net increase in income of £199,760. This additional income will offset increased employer’s superannuation and utility costs of £24,910 and £18,190 respectively.

 

      The Department will make a contribution of £210,540 to the efficiency programme in 2009/10.  Efficiency savings will be made as follows:

 

Efficiencies	£
Insurances	5,740
Personal Computers	1,820
Stationery	2,980
Budgetary Efficiencies	200,000
Total Departmental Efficiency Savings	210,540

 

      Departmental efficiencies have been achieved through increased rental income following rent reviews on a number of units in the Council’s industrial estates.

 

City Investment Fund

 

      The Director of Corporate Services presented to the Strategic Policy and Resources Committee on 14 December 2007 a cash flow analysis for the City Investment Strategy which could raise £29.0m over three years without recourse to borrowing. As part of this analysis it was recommended that £1.0m should be included in the Estimates for 2008/09 and £2.0m in 2009/10. 

 

      The Estimates presented for 2009/10 include an amount of £2.0m. However, economic conditions dictate flexibility in the use of this fund. For this reason I suggest that the fund be used for the following purposes as and when appropriate:

 

·         As a resource for the City Investment Strategy

 

·         As a resource for building up the Council’s reserves as recommended by the Local Government Auditor

 

·         As a contingency to safeguard against uncertainty in the current economic climate.

 

Corporate Thematic Priorities

 

      As part of the corporate planning process Members and Chief Officers have identified a number of cross-cutting priorities which cannot be solely delivered within functional budgets. It is recommended that a corporate strategy budget is established to finance these cross cutting priorities. This budget will be managed by COMT and reported to the Strategic Policy and Resources Committee. A budget of £500,000 is included in the Estimates for this purpose.

 

      The priority areas which will have access to this budget are:

 

·         Safer Belfast

 

·         Older People

 

·         Younger People

 

·         Invest to save

 

·         Customer Strategy

 

Development Committee

 

      A spending limit of £24,226,210 is recommended for the Development Department in respect of the financial year 2009/10.  Excluding capital charges of £1,326,950 this represents an increase of £429,760 or 1.91% over last year.

 

      The main budgetary intentions of the Department for 2009/10 are set out below:

 

	£
Economic Initiatives Section	7,227,010
Community Services	6,456,490
Waterfront Hall / Culture & Arts	5,249,110
Directorate	5,293,600
	24,226,210

 

      The Department’s increased budget of £429,760 provides for increased employer’s superannuation and utility costs of £75,180 and £207,470 respectively.

 

      The Department will also incur increased costs with the opening of the Ulster Hall and the new funding arrangements with DETI for Local Economic Development.

 

      The Ulster Hall will be fully operational in 2009/10. This will increase the Departments expenditure by £751,150 but will be mostly offset with income of £574,300.

 

      The first phase of the European Development Funding for Local Economic Development is complete. Under this arrangement 50% funding was from the European Union through DETI with the remaining 50% funding being provided by the Council. Under the new programme, with the change in priority areas, it is anticipated that income from DETI will fall to 40% leaving the Council bearing 60% of the cost of the programme. This funding change will result in additional costs of £180,000 in 2009/10 and may lead to further additional costs in subsequent years. 

 

      Members will recall that a budget of £400,000 was included in the 2008/09 estimates to support the Tall Ships event. A budget of £200,000 has been included in the 2009/10 estimates resulting in a reduction of £200,000.

 

      Approval was also granted in 2008/09 to support the World Irish Dancing Championships. This budget will not be required in 2009/10 resulting in cost reductions of £100,000.

 

      Costs associated with Interreg and BERI projects of £59,660 and £66,780 respectively have not been included in this year’s estimate. These three year European funded projects, aimed at promoting best practice across Europe, are now complete.

 

      Cost reductions have also been made in the Policy and Research Unit. As a result of work carried out by Business Improvement, the Policy and Research Unit is now structured to allow much of its work to be carried out internally. This will reduce it’s reliance on external consultants and as a result savings of £60,940 have been included in the 2009/10 estimates.

 

      The Department will make a contribution of £163,840 to the efficiency programme in 2009/10.  Efficiency savings will be made as follows:

 

Efficiencies	£
Insurances	65,300
Personal Computers	10,940
Stationery	11,290
Budgetary Efficiencies	76,310
Total Departmental Efficiency Savings	163,840

 

      Departmental efficiencies will be made in employee costs as a result of reviews carried out by Business Improvement Section.

 

Parks and Leisure Committee

 

      A spending limit of £33,020,230 is recommended for the Department in respect of the financial year 2009/10. Excluding capital charges of £3,721,420 this represents an increase of £2,030,730 or 7.45% over last year.

 

      The main budgetary intentions of the Department for next year are set out below:

 

	£
Leisure Services	13,685,010
Parks and Cemetery Services	18,155,760
Directorate	1,179,460
	33,020,230

 

      There are a number of areas where significant change has occurred from last year.

 

      Increased costs of £251,710 must be borne by the Department in respect of employer’s superannuation. 

 

      Utility costs for the department have increased by £745,270 which reflects increases in Oil, Electricity and Gas.

 

      It is estimated that Leisure Centre Income will increase by £223,510 with the continuation of the BOOST means tested benefit system and the early opening scheme.  The £18.2million multi?agency Grove Wellbeing Centre bringing wellbeing, fitness, health and lifelong learning under one roof will see its first full year of operation.  The new centre is the result of collaboration of funding from BelfastCity Council (57% of the funding), North and West Belfast Trust (38%) and BELB (5%).  Other funding has been awarded from BRO Neighbourhood Renewal and Urban II funding for a new playground on the site. This has resulted in growth of £143,730 which is included in the estimate. It should be noted that the Department will not provide a budget for Beechmount Leisure Centre in 2009/10 following the decision by Council to close this facility - this results in savings of £221,630.

 

      As part of the creation of the new Parks & Leisure Department work is in progress for the development and implementation of a Departmental Improvement Plan. A budget of £50,000 has been included for the development of a Parks & Leisure Strategy for Belfast. The Parks Improvement Plan is an element of this overall plan which was outlined to the Parks and Leisure Committee on 13th September 2007. The management plans of several parks include a programme of tree safety for which a budget of £80,000 has been provided. A budget of £30,000 is included in the estimate to meet new legislative requirements regarding the health and safety of headstones within cemeteries.

 

      The Parks Improvement Plan includes a range of operational reviews which have yet to reach a conclusion.  No provision for this potential growth is included in this figure and a report setting out the recommendations will be brought to committee for approval at a later stage.

 

      The Department will make a contribution of £230,640 to the efficiency programme in 2009/10.  Efficiency savings will be made as follows:

 

Efficiencies	£
Insurances	188,630
Personal Computers	18,370
Stationery	23,640
Total Departmental Efficiency Savings	230,640

 

Health and Environmental Services Committee

 

      A spending limit of £49,738,470 is recommended for the Department in respect of the financial year 2009/10. Excluding capital charges of £505,440 this represents an increase of £1,973,940 or 4.18% over last year.

 

      The main budgetary intentions of the Department for next year are set out below:

 

	£
Environmental Health	8,112,230
Waste Management	19,051,600
Building Control	1,311,590
Cleansing	20,363,130
Directorate Support	899,920
	49,738,470

 

      There are a number of areas where significant change has occurred from last year, these include increased costs of £335,770 which must be borne by the Department in respect of employer’s superannuation, however the impact of this increase on staffing costs has been reduced through savings in overtime of £62,970 across the department.

 

      Members will be aware that the Council’s Waste Disposal Financial Strategy was developed to address the enormous rise in the Waste Disposal costs which the Council would incur and especially to lessen the impact of the significant step increases which were forecast to be incurred between 2006/10. Waste Management will incur significant additional costs for 2009/10, most notably increased landfill tax costs of £800,000 in line with the £8 per tonne annual increase announced by the Chancellor of the Exchequer in the March 2007 Budget. Additional operational costs of £669,000 and £219,600 will also be incurred in relation to in?vessel composting and the food waste pilot respectively. However, the increased cost of in-vessel composting will be somewhat offset with the cessation of windrow composting resulting in a saving of £214,950.

 

      Waste Management estimates allow for Landfill Contract cost reductions of £1,200,000 arising from reductions in forecast “waste arisings” and the reduction of employee costs to allow for savings due to staff turnover. Further savings of £438,260 have been included arising from new tender exercises for Recycling Centres and Civic Amenity Sites contract costs The savings generated have meant that despite the major increases in operational costs for Waste Management for 2009/10 the actual increase in the cost of the service has been limited to £113,720 representing an increase of 0.60% from 2008/09.

 

      In addition to the normal increase on employee costs and other operational costs, Cleansing Services will incur additional commercial waste disposal costs of £104,060 during 2009/10 together with estimated increases in fuel costs of £363,000. However fees and charges income will increase by £254,650 and fleet leasing and maintenance will reduce by £420,830. Budgetary efficiencies of £300,000 relating to segregated waste costs and reduced allowance for compensation claims of £70,000 have also been included in the estimates which has meant that the overall increase in the cost of Cleansing Services is £485,200 representing an increase of 2.44%.

 

      The Environmental Health Service’s budget has increased by £628,480 representing an increase of 8.40%, and includes increased costs of £168,260 relating to the Dog Control Service and £150,000 of additional funding for the Community Safety Wardens Service which will allow the generation of additional matched funding, by external bodies, for the continuation of an integrated warden service.

 

      The economic downturn is forecast to continue to have a major impact on the Building Control Service, with income, estimated to decrease by £879,700 during 2009/10 mainly due to the decline in plan and inspection fees. In response to this shortfall and the estimated inflation increases in staffing and operational costs, management of the Building Control Service have undertaken a critical review of service budgets. Savings in 2009/10 costs will be generated through the non filling of posts, implementing secondments and the reduction in supplies and services costs resulting in actual reductions in gross expenditure of £120,000 in 2009/10. These cost reductions will reduce the impact of falling plan and inspection fee income to the effect that the overall increase in the net cost of the Building Control Service for 2009/10 will amount to £759,550 increasing the net cost of the service from £552,040 in 2008/09 to £1,311,590 in 2009/10. 

 

      In addition to the savings outlined above, the Department will also make a contribution of £1,005,440 to the efficiency programme in 2009/10. Efficiency savings will be made as follows:

 

Efficiencies	£
Insurance	166,730
Personal Computers	26,120
Stationery	42,590
Budgetary Efficiencies	770,000
Total Departmental Efficiency Savings	1,005,440

 

      Budgetary efficiencies have been made by reducing the Waste Management employees budget by £100,000, by reducing the Cleansing compensation claims budget by £70,000, by the removal of the Cleansing segregated waste budget of £300,000 and by reducing landfill contract costs by £300,000.

 

Town Planning

 

      In previous years Members have drawn attention to the need to provide some funds to cater for possible representation at public enquiries etc.  Accordingly a sum of £30,450 has been provided for this purpose.

_____________________________

 

      Belfast City Council like all other Local Authorities across the country is faced with the constant pressure of balancing increasing demands against ever decreasing resources and 2009/2010 will be no exception.

 

      A major effort has been made by all concerned to ensure that the estimates presented are meaningful, realistic, and correlate closely with the key tasks and activities within the Corporate Plan.

 

      On February 2009 the estimates of the various Council Departments and Committees will be approved and adopted.  In due course a full copy of the Corporate Plan incorporating a summary of the financial information will be distributed to each Member of Council.

 

      My thanks are due to all for the continued co-operation and assistance which I have received over the past months in what has been a long and exhausting exercise to compile the Revenue Estimates.

 

DECISIONS REQUIRED:

 

1.   To Fix the Cash Limits for the various Committees of the Council, and

 

2.   To approve the estimates for the Policy and Resources Committee.

 

APPENDICES

 

Revenue Estimates 2009/20100
Council Overall	Appendix 1 – Page 1
Strategic Policy and Resources Committee
Chief Executive’s Department	Appendix 2 – Page 1
Chief Executive’s Department	Appendix 2 – Page 2
Corporate Services Department	Appendix 3 – Page 1
Corporate Services Department   Improvement Department Improvement Department	Appendix 3 – Page 2   Appendix 4 – Page 1 Appendix 4 – Page 2
Development Committee
Development Department	Appendix 5 – Page 1
Development Department	Appendix 5 – Page 2
Parks & Leisure Services Committee
Parks & Leisure Services Department	Appendix 6 – Page 1
Parks & Leisure Services Department	Appendix 6 – Page 2
Health & Environmental Services Committee
Health & Environmental Services Department	Appendix 7 – Page 1
Health & Environmental Services Department	Appendix 7 – Page 2
Key Messages	Appendix 8

 

      The above appendices relate to the several Council Departments.

 

      For each Department/Committee there are two information sheets.  The first information sheet attempts to explain the major changes from last year’s budget to the present position, while the second sheet indicates the major items of spend proposed for next year, i.e. 2009-2010.

 

APPENDIX 1

 

REVENUE ESTIMATES 2009/2010

 

Year Ending 31/03/2009	Committee		Year Ending 31/03/2010	Var £	Var
15,364,330	STRATEGIC POLICY AND RESOURCES COMMITTEE		19,146,520	3,782,190	24.62%
5,590,580	Chief Executive’s Department		5,680,850	90,270	1.61%
215,620	Legal Services Department		254,570	38,950	18.06%
10,406,690	Corporate Services Department		12,189,780	1,783,090	17.13%
(1,348,560) (500,000) 1,000,000 0	Core Improvement Team Rent Reviews City Investment Fund Corporate Thematic Priorities		(1,478,680) 0 2,000,000 500,000	(130,120) 500,000 1,000,000 500,000	9.65%   100.00%
23,796,450	DEVELOPMENT COMMITTEE		24,226,210	429,760	1.81%
30,989,430	PARKS AND LEISURE COMMITTEE		33,020,230	2,030,800	6.55%
47,764,590	HEALTH AND ENV. SERV. COMMITTEE		49,738,470	1,973,880	4.13%
31,400	TOWN PLANNING COMMITTEE		30,450	(950)	(3.03)%
117,946,200			126,161,880	8,215,680	6.97%
(4,518,050)	Less Adjustment for Capital Charges		(3,399,790)	1,118,260	(24.75)%
113,428,150	Less		122,762,090	9,333,940	8.23%
(4,040,970)	GENERAL EXCHEQUER GRANT
109,387,180
	Less
(2,400,000)	ESTIMATED CREDIT BALANCE
106,987,180		(a)
4,822,430	NOTIONAL PRODUCT OF 1p RATE	(b)
22.1853p	NON-DOM. RATE IN £ - Y/E 31/03/10	(c )=(a)/(b)
0.011449	CONVERSION FACTOR	(d)
0.2540p	DOMESTIC RATE IN £ - Y/E 31/03/10	(c)x(d)/100

 

 

APPENDIX 2.1

 

CHIEF EXECUTIVE’S DEPARTMENT

REVENUE ESTIMATES 2009/2010

 

		£	£
Estimate 2008/09			5,621,980
Efficiency Savings Insurances Personal Computers Stationery		(8,230) (6,660) (5,960)	(20,850)
Growth Peace III- Management Costs			429,180
Increased Costs Employer’s Superannuation Corporate Communications – Advertising Manager’s Post DPP		76,250 41,000 21,420	138,670
Reduced Costs Conferences and Approved visits Equipment Tools and Materials		(24,340) (17,750)	(42,090)
Increased Income
Peace III – Management Costs Grant			(429,180)
Normal Increase (eg pay awards / supplies and services)			13,590
Estimate 2009/10			5,711,300

        *Includes Town Planning Budget of £30,450.

 

APPENDIX 2.2

 

CHIEF EXECUTIVE’S DEPARTMENT

MAIN ITEMS OF ESTIMATED EXPENDITURE 2009/2010

 

	Inc. Capital Charges	Exc. Capital Charges
	£	£
District Policing Partnership Board Committee Services Lord Mayor’s Support Members’ Support Members’ Allowances Members’ Facilities Ceremonial Occasions Good Relations Corporate Communications/Publicity Departmental Administrative Support Records Management	147,100 816,200 496,100 307,500 651,100 238,000 186,000 603,400 1,032,800 338,000 121,500	147,100 812,500 479,200 307,500 651,100 238,000 186,000 591,900 1,032,800 338,000 121,500

 

 

APPENDIX 3.1

 

CORPORATE SERVICES DEPARTMENT

REVENUE ESTIMATES 2009/2010

 

		£	£
Estimate 2008/09			10,406,690
Efficiency Savings Insurances Personal Computers Stationery		(46,400) (39,950) (41,090)	(127,440)
Increased Costs
Employer’s Superannuation Utility Costs City Hall CTU		222,970 178,320 739,550 249,110	1,389,950
Cost Reductions Accommodation			(492,630)
Reduced Income ISB External Income BIS External Income BIS  Internal Income Loss of District Fund Interest		886,400 388,600 225,670 500,000	2,000,670
Increased Income ISB Internal Income BIS – KPI’s		(876,500) (474,230)	(1,350,730)
Normal Increase (eg pay awards /supplies)			363,270
Estimate 2009/10			12,189,780

 

 

APPENDIX 3.2

 

CORPORATE SERVICES DEPARTMENT

MAIN ITEMS OF ESTIMATED EXPENDITURE 2009/2010

 

	Inc. Capital Charges	Exc. Capital Charges
	£	£
City Hall Adelaide Exchange Clarendon Dock CecilWard Building Linenhall Exchange HR Strategy and Workforce Development    Planning Contributions to Specified Bodies LGA Fees Employment Support Scheme Corporate Strategic Objectives Interest on District Fund Bank Charges Pensions Central Transactions Unit IAG Project & Corporate Systems	968,300 1,433,400 370,300 371,300 45,000   529,200 255,000 110,000 132,000 150,000 (500,000) 60,000 1,900,000 742,000 800,000 455,800	968,300 1,433,400 370,300 192,700 45,000   529,200 255,000 110,000 132,000 150,000 (500,000) 60,000 1,900,000 742,000 800,000 455,800

 

APPENDIX 4.1

 

IMPROVEMENT DEPARTMENT

REVENUE ESTIMATES 2009/2010

 

		£	£
Estimate 2008/09			(1,348,560)
Efficiency Savings Insurances Personal Computers Stationery Departmental Efficiencies		(5,740) (1,820) (2,980) (200,000)	(210,540)
Increased Costs
Employer’s Superannuation Utility Costs		24,910  18,190	43,100
Normal Increase (eg pay awards / supplies and services)			37,320
Estimate 2009/10			(1,478,680)

 

 

APPENDIX 4.2

 

IMPROVEMENT DEPARTMENT

MAIN ITEMS OF ESTIMATED EXPENDITURE 2009/2010

 

	Inc. Capital Charges	Exc. Capital Charges
	£	£
Core Improvement Operations Estates Management   1.       Bog Meadows     £      (2,700,600) 2.       Duncrue              £        (731,000) 3.       Gas Works           £        (723,000)   Procurement CIT Initiatives Project Management	2,061,000 (3,906,100)           139,000 55,000 172,000	2,061,000 (3,909,300)           139,000 55,000 172,000

 

 

APPENDIX 5.1

 

DEVELOPMENT DEPARTMENT

REVENUE ESTIMATES 2009/2010

 

		£	£
Estimate 2008/09			23,796,450
Efficiency Savings Insurances Personal Computers Stationery Departmental Efficiencies		(65,300) (10,940) (11,290)   (76,310)	(163,840)
Increased Costs Utilities Employer’s Superannuation Ulster Hall Local Economic Development		207,470 75,180 751,150 180,000	1,213,800
Cost Reductions Tall Ships World Irish Dancing Championships Interreg BERI Policy and Research		(200,000) (100,000) (59,660) (66,780) (60,940)	(487,380)
Increased Income   Ulster Hall			(574,300)
Normal Increase (eg pay awards / supplies and services)			441,450
Estimate 2009/10			24,226,210

 

 

APPENDIX 5.2

 

DEVELOPMENT DEPARTMENT

MAIN ITEMS OF ESTIMATED EXPENDITURE 2009/2010

 

	Inc. Capital Charges	Exc. Capital Charges
	£	£
Community Services   Waterfront and Ulster Hall	6,456,500   3,632,600	6,044,900   2,715,500
Economic Initiatives Events Tourism Arts and Culture Economic Development Planning and Transport North Foreshore Markets – Operations and Management	2,398,000 2,393,600 1,616,500 1,207,200 467,600 400,200 362,400	2,398,000 2,393,600 1,616,500 1,207,200 467,600 400,200 364,100
Directorate Development Directorate City Development Policy and Research SNAP European Unit	2,918,600 930,100 648,000 501,100 295,800	2,918,600 930,100 648,000 501,100 295,800

 

 

APPENDIX 6.1

 

PARKS AND LEISURE SERVICES DEPARTMENT

REVENUE ESTIMATES 2009/2010

 

		£	£
Estimate 2008/09			30,989,430
Efficiency Savings Insurances Personal Computers Stationery		(188,630) (18,370) (23,640)	(230,640)
Increased Costs Utility Costs Employers Superannuation Grove Wellbeing Centre P&L Strategy Tree Safety Headstone Safety		745,270 251,710 143,730 50,000 80,000 30,000	1,300,710
Savings
Beechmount Leisure Centre			(221,630)
Increased Income Leisure Centres			(223,510)
Normal Increase (eg pay awards/supplies and services)			1,405,870
Estimate 2009/10			33,020,230

 

 

APPENDIX 6.2

 

PARKS AND LEISURE DEPARTMENT

MAIN ITEMS OF ESTIMATED EXPENDITURE 2009/2010

 

	Inc. Capital Charges	Exc. Capital Charges
	£	£
Leisure
Leisure Centres	11,774,700	9,194,400
Leisure Development Leisure Business Support	811,100 1,099,100	811,100 1,099,100
Parks and Cemeteries
Parks and Open Spaces Parks and Cemeteries Services Unit Zoo Parks and Cemeteries Development Unit Playing Fields/ Recreation Grounds Playgrounds Landscape Planning and Development Belfast Castle/Malone House Cemeteries and Crematorium Conservation and Education Parks Business Support	6,708,800 2,552,400 1,578,700 683,400 1,298,800 858,000 786,200 692,400 772,700 520,800 1,300,100	6,543,600 2,552,400 1,284,000 683,400 875,200 858,000 786,200 500,900 711,200 517,900 1,300,100
Directorate Anti Social Behaviour Directorate Support	300,000 879,500	300,000 879,500

 

 

APPENDIX 7.1

 

HEALTH AND ENVIRONMENTAL SERVICES DEPARTMENT

REVENUE ESTIMATES 2009/2010

 

		£	£
Estimate 2008/09			47,764,590
Efficiency Savings Insurances Personal Computers Stationery Cleansing Waste Management – Employee Costs Landfill Contract Landfill Contract - Tax	(1,100,000)     800,000	(166,730) (26,120) (42,590) (370,000) (100,000)   (300,000)	(1,005,440)
Increased Costs Fuel In-vessel Composting Employer’s Superannuation Commercial Waste Disposal		363,000 669,000 335,770 104,060	1,471,830
Growth Community Safety Wardens Dog Control Food Waste Pilot		150,000 168,260 219,600	537,860
Cost Reductions Windrow Composting Building Control Recycling Centre & CAS Contracts Fleet Leasing and Maintenance Overtime		(214,950) (120,000) (438,260) (420,830) (62,970)	(1,257,010)
Increased Income Cleansing Fees & Charges			(254,650)
Reduced Income Building Control			879,700
Normal Increase (eg pay awards / supplies and services)			1,601,590
Estimate 2009/10			49,738,470

 

 

APPENDIX 7.2

 

HEALTH AND ENVIRONMENTAL SERVICES DEPARTMENT

MAIN ITEMS OF ESTIMATED EXPENDITURE 2009/2010

 

	Inc. Capital Charges	Exc. Capital Charges
	£	£
Environmental Health   Waste Management   Building Control   Cleansing	8,112,200   19,051,600   1,311,600   20,363,200	8,097,100   18,622,300   1,311,600   20,301,600”

 

            The Director of Corporate Services elaborated on and highlighted various aspects of the report.  He referred to specific areas of increased expenditure and also to the budgetary efficiencies which had been achieved throughout each of the Departments.  He indicated that if the Committee were minded to approve the estimates of income and expenditure the overall expenditure for the Council would amount to £122,762,090.  He pointed out that the final estimate for the General Exchequer Grant would not be available until the Land and Property Services agency had finalised the Estimated Penny Product.  Until those figures had been received it would not be possible to calculate the net expenditure and therefore determine the Domestic Rate and the Business Rate.  However, the most up-to-date information available from Land and Property Services had indicated that a District Rate increase of approximately 8.59% for 2009/2010 would be required to meet the Council’s estimated expenditure.  He explained that when this rise was combined with the Regional Rate, which had been frozen again for the second consecutive year, the approximate increase to both the domestic and non-domestic ratepayers would be 3.5%.

 

            During a lengthy discussion, Members referred to the difficult economic pressures which the citizens of the City were facing, the need for the Council to set out the steps that it was taking to assist people to cope with the pressures and the need for the Council to continue to provide public services in a value for money fashion.  Members referred also to a number of areas where they would like further consideration to be given to reducing expenditure.  These included events, travel and conferences, advertising, use of consultants and spending on uncommitted projects or initiatives.

 

            The Committee therefore agreed that further work on the estimates of expenditure for the 2009/10 financial year was necessary and directed that:

 

(i)      the Chief Executive and the Director of Corporate Services examine the overall Council estimates and discuss with Departments the need to identify further cost savings and submit a report to the next meeting of the Committee scheduled to be held on 23rd January;

 

(ii)     briefings be held for each of the Party Groupings on the Council in relation to the Revenue Estimates 2009/2010;

 

(iii)    a revised efficiency programme be developed in the context of a three-year financial planning cycle and that a report thereon be submitted to a future meeting of the Strategic Policy and Resources Committee;

 

(iv)    Council officers continue to work with the Land and Property Services agency and the Minister of Finance and Personnel to seek to improve the position in relation to the Estimated Penny Product and the development of a Service Level Agreement between the Council and the Agency;

 

(v)     a report on measures which could be introduced in order to support local businesses and ratepayers be submitted to the Committee in due course; and

 

(vi)    a report be prepared on the key communication issues.