Fife Labour Budget Amendment

INTRODUCTION

Over the past four budgets, Labour has put forward its own views on the salami slicing approach to decision making where councillors have to pick and choose what cuts to take from a list presented by Council officers. We have consistently argued that this kind of approach which only looks at a small percentage of the total budget is both inadequate and fails to grasp the big issues and challenges facing Fife Council and local government everywhere.

Any approach to budget must be policy driven and must look at all aspects of what it is we do as a council and what it is we actually want to be doing as a council. This must be based on a number of key factors which include;

 Statutory requirements

 Level of needs in our communities

 Social and economic requirements for a healthy and prosperous Fife

Our policy approach must also be driven by the guiding principles of social inclusion, fairness and equality while achieving best value for the tax payer through ensuring all actions and provision are driven in the most efficient and effective way.

Labour has set out a number of key policy led budget proposals over the last four budgets around policy reviews, a reduction in directorate and management costs as well a change to the way in which the council approaches budget setting. Sadly these have been ignored by the SNP Lib Dem coalition although a number of key areas have been picked up by managers within the council.

We are now around 12 weeks away from a council election and our amendment today is therefore aimed at setting out the direction and processes which Labour will bring forward after the election to govern the finances of the council into a new council and over the next five years.

An incoming Labour Administration will use the first four months to conduct a review of all existing expenditure and will bring forward a revised budget in September of this year making any adjustments and changes required to address our immediate priorities for change. We will also use this budget to set out our strategic reviews using a Zero Based Budget approach service by service for the following years. 

PUBLIC ENGAGEMENT

Key to the new budget approach will be on going and meaningful engagement with the public through a process of involvement with key stakeholders in a range of the Council’s services and responsibilities. Whilst this process will be flexible and able to be extended over time as required, the immediate priority in May this year will be the establishment of Area Education Forums and a Forum to examine charges and concessions within the Council.

Education Forums

The Education Forum will be the body that will take the lead role on the budget review of all expenditure within education and would be supported by finance officers of the Council. The Forum will be made up of parents, teachers, trade unions and elected councillors with the ability to co-opt expertise as required. Area based parent teacher forums representing all schools in Fife will also feed into the Education Forum with views and proposals for budget.

Paying for services

While the council tax has remained frozen over the past four years a host of new charges and increased charges have been introduced across Fife. We propose to freeze all charges for health and social care whilst exploring the feasibility of achieving the objective of removing the £11 per hour for homecare and the charge for the community alarm. This group will review all charges and concessions looking at affordability, eligibility and fairness.

There will be areas where the Council can increase its income from charges but the balance will need to be struck to ensure that we are not simply diverting to stealth taxes to cover up the lack of political courage at a national level to address the council tax dilemma.

This group will have representation from business, service users, carers and campaigners and the wider community. One example of excessive increases in charges is that of bereavement charges where charges for burials and cremations has soared by over 32% in the last four years.

Budget consultation

With reference to wider consultation on the budget, Labour in administration will publish a draft budget in late November each year in order that there is ample time for meaningful engagement with the general public, groups and organisations, business and political groups within the council.

To date, while a number of methods have been tried and some at cost to the Fife taxpayer, the success rate has not been great. This is not to criticise the hard and enthusiastic work that has gone into trying to engage the general public and groups, but to recognise, particularly building on the Scottish Governments approach of publishing a pre budget, that to do likewise gives something tangible to actually consult on.

It is for the administration party/ties to produce a budget and consult on it and this is the point at which opposition parties can make a meaningful contribution and hopefully, as we have seen in the case of the Scottish Parliament, bring some influence to bear on the final outcome which will be the budget meeting in early February.

APPROACH TO BUDGET 

Fife Council has a revenue budget of £825,482 million and delivers key services to people across the Kingdom. This year the director of Finance has recommended that savings of £13,625 million are to be made for the 2012/13 budget.

The funding gap is £283,000. Assumptions have then been made for demographics and locally determined pressures of £5.5 million and for the Council’ s contribution of £2.842 million for health and social care and early years change funds with a proposal to restore the balances by a further £5 million. This brings the proposed cuts in services this year to £13.625 million.

Budget pressures

The projections for demographic pressures raise a number of issues that Fife Council must address with the Scottish Government. Most notably, who is responsible for meeting the rising costs of health and social care and if it is local government then this is a bizarre situation given that local government has no ability to increase revenues as the council tax has in effect been capped for the past four years.

Fife Labour will review the assumptions being made around budget pressures with a view to identifying where the costs associated with these pressures should be met from. We take the view that Fife is not getting a fair deal from the Scottish Government and that Fife Council must stand up for Fife. In this budget we propose to revise the provisions being made downwards to £3m and will bring back a more detailed analysis and report within our revised budget in September this year.

Workforce change

To date Fife Council has spent £15.9 million on workforce change which in effect is reducing the numbers of staff in the workforce by paying an enhanced redundancy package for people to leave their employment.

It is estimated that a further £40m to £50m will be needed to continue with this programme over the next three years and that is why £5m is being proposed to be put into balances for this year. Whilst it is costing millions of pounds to support people to leave the Council it is not clear that this is the best use of taxpayers’ money. For example, in 2009/10 1,109 people left the councils employment but 847 people were recruited as new starts

Fife Labour will conduct an immediate review of the workforce change policy and will not make the provision of £5m into balances for this purpose within this budget. We are not satisfied that the enhanced redundancy programme costing the Fife tax payers tens of millions of pounds is a cost effective way of reducing the overall staffing numbers.

We also want to examine in more detail the numbers of senior officers who have been taken out of their management posts with an agreed package but are still employed and working in the Council on special projects.

We welcome the proposal that came from the Chief Executive not to replace the latest Executive Director to take a package and retire early saving the council £147,000 and merging the directorate into other directorates. This is something that Labour has put forward in the last few budget papers. It is right that the political leadership within the Council give direction on the levels of management costs, the costs of redundancy packages and overall employment issues. Labour will provide that strong leadership that has not been forthcoming over the lifetime of this administration.

Zero Based Budgeting

The approach being taken this year as in the last number of years is one that has become known as ‘salami slicing’ which can best be described as a process whereby councillors are given a list of options to cut and are then asked to choose which cuts to make.

Fife Labour has consistently over the life of this administration argued that this is not the best way to produce a budget and is not the best way to ensure efficiency and effectiveness within services, nor indeed to ensure that we are actually spending the tax payers money on the right things.

We have put forward proposals for a new approach to budgeting within Fife that can be best described as an approach based on the concept of Zero Based Budgeting (ZBB) and while this has been constantly mocked by the SNP Lib Dem coalition here in Fife, its prominence as a tool for best practice in budgeting has come to the fore in all levels of government in countries across the world and is now actively encouraged as an approach by the Charted Institute of Public Finance and Accountancy (CIPFA).

There are many definitions given but for our purpose we have highlighted that given by the Council for Voluntary Organisations where they say; “Each programme is examined to justify its existence and is compared to alternative programmes. Priorities are established and each cost centre is established to prove its necessity”.

To put it another way, councillors in Fife were this year presented with £5.3 million of proposed cuts from the Environmental and Development directorate and asked to choose £4.4 million that would make up the cut in the total revenue budget of that directorate. The key point is that councillors only actually examined 4.7% of the total budget of this Directorate and therefore it would seem worked on the assumption that 95% of the budget was being used in an effective and satisfactory way. More significant, there was an assumption that what we are doing with the 95% of that budget is actually what needs to be done as it has always been done.

Labour says that the whole 100% of the Environmental and Development budget should be examined with an approach that starts from the premise that no costs or activities should be factored in to the plans for the coming budget period, just because they figured in the cost or activities for the current or previous periods. In other words, everything that is included in the budget must be considered and justified both from a financial and policy perspective.

This is an approach that a Labour administration after May 3rd this year will adopt with every service and every penny of tax payers’ money within Fife Council. Labour will examine the scope for Zero Based Budgeting across all Council services and bring forward a five year programme within the first five months of taking office on May 3rd this year.

Staffing

The most valuable asset within the council is its staff of which there are currently over 22,000 employed within Fife Council. Staff costs are also the largest single cost to the council accounting for over 50% of the total budget.

The level of sickness absence within the Council is amongst the highest of any Scottish local authority and the cost of this in both service delivery and financial terms is a drain on resources. Figures we have examined show that in the 36 week period between April and December 2011 the cost in wages of staff on sickness amounted to over £10 million and that the cost of sickness cover and loss of productivity will costs many millions of pounds more.

If Fife Council recognise that their workforce is the most valuable asset, then there should be much more focus on supporting staff who are suffering health issues. This not only recognises that we are taking our legal responsibilities seriously to ensure that employees do not become ill as a result of their work, but will also have financial benefits in terms of potentially saving millions of pounds of public money.

Fife Labour recognises that while Fife Council has a policy on managing health issues there is little evidence that the policies which are meant to assist staff have been successful over the years. The levels of staff sickness attributable to stress with hotspots – for example – in Social Work home care services in the first 9 months of the year accounted for 28% of the total council absence figures. It is also understood that anxiety at work is raised when staff are subject to constant change, job insecurity and workloads which all contribute significantly to stress in the workplace.

Fife Labour is committed to supporting staff to reduce sickness levels by introducing a programme of – reviewing staff support mechanisms, training for managers, exploration of work conditions, and accountability for staff support. By these actions we take we propose to reduce the cost of sickness to the council over the next year by £1 million and will put in place a continuing programme that will bring down the costs year on year.

We further note that the cost of agency staff within the council is significant. In the first 36 weeks of the financial year 2011-2012 agency costs were £2,671,264 million

We take the view that spending millions of pounds of Fife taxpayers’ money to make enhanced redundancy payment to staff while then using millions more of taxpayers’ money to bring in agency workers or pay overtime is a false economy. This will be examined in detail as part of the review of workforce change.

In the next financial year we will reduce the costs of agency workers within the Council by £1.6 million. We will further reduce the over time bill within the next year by £500,000 and will reduce staffing costs by a further £525,000 through staffing under spends and turnover.

Our view is that even if Fife Council was awash with money we would be calling for wage restraint amongst Chief Officers. The gap between the highest earners and lowest earners in local government has grown to unacceptable levels in recent years and must be addressed. We wish to achieve consensus through COSLA and Scottish local government with Trade Unions to accept that the low paid should be protected from wage restraint while higher earners should continue to accept a pay freeze.

Labour was consistent in calling for Chief Officers to show leadership and forgo their 2.5% wage increase in April 2010 which for executives amounted to £52 a week. Fife Council at a political level must show leadership in Scotland and work to reduce the massive pay gap between those at the top and those on the lower grades within Fife Council. We will openly campaign as a council for fairness and to close the gap.

SOCIAL WORK

In the 2008 budget Labour proposed a “fundamental review of how Social Work services are provided in Fife” noting that the 21st Century Review of Social Work deemed the current model of provision as “unsustainable”. We stated then that “the review would ensure that service users are involved at every stage, along with the NHS, voluntary and private sectors, and crucially Fife Council Social Work staff. The review will work on a zero budget basis, rebuilding services from the ground up”.

We also argued that Fife Council must call on the Scottish Government to examine the links between Health and Social Work and look to merge both into a Social and Community Service for the current community care functions. We are pleased that this is now happening and believe that Fife should embrace this new approach and show strong leadership that will put Fife at the fore.

Health and Social Care – Put people first

 The Scottish Government plans to bring about a better integration of adult health and social care which they say aims to ‘improve the quality and consistency of care for older people and put an end to the cost-shunting between NHS and local government’. 

This gives us the opportunity in Fife to create a model for the delivery of health and social care that once again will put Fife into the vanguard of shaping services for adults and older people. We can be bold and we should make clear that we will allow no false barriers to be put in the way of bringing together an integrated service and all budgets from both the Council and NHS Fife will be pulled into one budget and managed by one team. 

Putting people first will be the key driver of the new integrated service. Fife Labour will seek a meeting with the Minster in early May and will all announce further detail on how this matter will be progressed by Fife Council in the days following the council elections. Every part of these budgets will be examined in detail to ensure that all the funds that should be available are available and an expert team of professionals, users and leaders in this field will be put in place to drive this much needed change. 

There now needs to be a discussion within every community about how we meet the challenges that come with changing demographics – the 75+ population in Fife is due to increase by 20.4% by 2014 and increase by 64.3% by 2024. 

The growing and changing needs around health and social care are very evident. There is a growing discussion which we believe must be based upon the key principle of the provision of the best care at the point of need from the cradle to the grave regardless of ability to pay and it must also reject the approach of the SNP Lib Dem coalition in Fife which to date has been based on privatisation and care on the cheap. 

We must acknowledge and accept that care in the community is not the cheap option and offering up service delivery to the cheapest bidder is simply not acceptable. Caring for the most vulnerable in our community cannot be left to market forces. Driving down the wages, the support and the training for staff in this sector is plain wrong and this practice must stop. We need the best skills and the highest motivation amongst care staff to ensure the very best service provision whether that is in care homes, or care at home. 

Quality care, highly skilled staff and the highest standards, these are the guiding principles that should and must guide us as we plan care services for the future.

 Fife Labour will work with all sectors in shaping the future of these public services based on putting people first.

 Children and Families

 We have rejected the proposals that were brought forward by officials in this year’s menu of cut choices and believe far too many would have a negative impact on service users and be detrimental to the well being of Fife. We have been constant that this service is in desperate need of a major review of all expenditure and will put this in place in May this year. 

There needs to be a new approach to involving all our partners who do a tremendous amount of work at the front end of what can be a very difficult area of work. The focus of recent years had tended to give a higher profile to elderly and adult care and it is only when something goes wrong that children and families become more visible. 

We want much more early intervention and a family centred approach across all services. We want to see an expansion of the early years work in both social work and education and will make this a key area of the education review. If we get this right then the savings for later years are immeasurable but the cost of continuing as we are is not sustainable either in financial or human terms. 

EDUCATION 

Teachers, pupils and all staff in our schools are working at full stretch and the last thing they need is more damaging cuts to the schools budgets. Labour will prioritise protecting school budgets and will conduct a review of all management and administrative support that makes up a substantial part of the overall education budget.

Education is the key tool to addressing inequality, poverty and social deprivation in Fife and as such it is crucial that we have the resources at the frontline to ensure every child achieves to their potential.

We believe that most of the savings proposals brought forward by the Education Service are not simply efficiency savings and will have a negative impact on children’s education. We will establish an Education Review Group and one of their first remits will be to examine these proposals in more detail while at the same time driving the zero based budgeting approach to the Education Service.

In the budget process over the last three years we proposed setting up an Education Forum made up of representatives of Parent Councils and we wrote to every Parent Council seeking their support. While this move was rejected by the SNP Lib Dem coalition, it did receive wide spread support from parents. We therefore propose that 7 Area forums be established with the support of the Area Committees and that these feed in to the Fife wide Forum outlined above.

Whilst the remit of this body will be developed in more detail, the broad objectives will be to involve schools and parents in the budgeting processes, a Fife wide review of the school estate, attainment and local school issues. The work of the Forums will feed into and assist greatly the Education Review Group.

Specifically we propose to revisit the savings proposals brought forward and remove £2 million from non school provision within the overall education budget and reinvest this into the front line within the first year of a new administration. The zero based budgeting for this Service will begin its exercise by examining non school provision expenditure before developing a structure to look at all schools expenditure. 

TRANSPORT SERVICES 

Transport underpins social inclusion, health and well being and economic activity at a cost to Fife Council of tens of millions of pounds every year. Fife Labour has consistently called for an over arching review which would clarify what the Council is seeking to achieve, how resources could be better co-ordinated and what model of service delivery provides value for taxpayers and service users alike. We believe that where appropriate and practicable local authorities should embrace an enabling role that sets strategic objectives and standards and ensures quality monitoring in performance. There is major scope for an enabling approach and model for the delivery of passenger transport in Fife that has been largely missed.

The principle of providing appropriate affordable transport for people who have difficulty using mainstream public transport underpins a wide range of key policy objectives. We therefore support the concept of demand responsive transport but we are not convinced of the approach that has been taken to date by Fife Council i.e. that of developing a dedicated internal fleet. We believe that in spite of numerous (and expensive) reviews, Fife lacks a clear strategy for Accessible Transport. Our approach would be to increase the use of external and voluntary sector providers by externalising the internal fleet and bring about substantial savings in the process.

 A PLAN FOR JOBS

 The rising levels of unemployment in Fife brings concern and anxiety to people throughout the Kingdom and while the actions of local government will not in themselves tackle this problem, there is much we can do as an authority to support existing businesses, support people to gain skills and experience and address the worst elements of the economic downturn which is likely to get worse as a result of the economic polices being pursued at a UK level.

Whilst here in Fife the SNP Lib Dem coalition have spent to date almost £16 million and are contemplating a further £40 million to put people out of work, across Scotland other local authorities are spending millions trying to get people into work.

Fife Labour will;

 Make available up to £5 million of balances over the next three years to invest in getting people into work, training and skills.

 Build a new partnership and task force of employers and training providers and put resources in to support businesses and colleges take more people into training and employment. Fife’s resources will act as a stimulus to help thousands of Fifers back into work.

 As an employer we will lead by example and will work with training providers to ensure that people are able to get work experience and training that will lead to real jobs within the Fife labour market and further afield.

 As a major purchaser of goods and services we will also ensure that the procurement process does not lock out local companies and indeed will work with business to find the best way of creating a fair playing field for Fife companies and businesses to compete.

 Establish a rapid response unit that is available to support companies at an early stage of them experiencing difficulties. Many Fife companies are finding the banks less than supportive and this on top of rising costs and tighter margins is a real threat and one that we will make sure we have the expertise to assist with.

Fife has seen a reduction of more than £4 million in support for economic activity within the region as a result of the scrapping of Scottish Enterprise Fife. A Labour Administration will make sure that Fife Council argues for a fair deal for Fife and will campaign to make sure that the continuing cuts to budgets in Fife are halted and that Fife starts to get a fair deal from the Scottish government. 

FIFE FIRE AND RESCUE 

The proposals to reduce the number of fire-fighters by 20 poses a risk that we do not believe Fife should be willing to accept. A new proposal to reduce this by 12 is equally not acceptable and while the risk may be a bit lower, it is still an unacceptable risk. The 20 fire- fighters should remain and recruitment should take place to get the numbers back to a level that will allow for acceptable risk that ensures that the service has the capacity to ensure that sufficient fire-fighters are in attendance to deal with the full range of tasks required to effect rescue and or fire fighting activities. 

CENTRAL SUPPORT SERVICES 

An organisation such as Fife Council needs an effective central support and the importance of this must be recognised. It is however equally important to make sure that the central support operation is efficient and effective and that the priority of directing resources to frontline core services is not compromised. We propose to undergo within immediate effect a review of the roles and functions of all central support services with the exception of financial services.

We note that over £2.8 million is currently spent on marketing and communications budget and we are proposing to reduce this budget significantly along with all central support budgets within the new financial year by £2.5 million.

Part of this saving will also be made by moving to a more democratic and accountable structure of political governance within the council that will reduce the numbers of committees and the waste of reams upon reams of reports being produced that requires little actions, are nodded through and in general are read by very few. 

COUNCIL TAX AND STEALTH TAXES 

As we move forward and reshape a new local government that will be better placed to take Fife forward and meet the needs and challenges of social and economic environment in which we live and work, there must be an acceptance that the issue of how local government is to be funded has got to be resolved.

Throughout the period of the council tax freeze we have seen stealth taxes being introduced that very often put a massive burden on those least able to pay. The housebound do not have a community alarm out of choice but out of necessity and it is a tragedy that here in Fife it is people like them that are bearing the brunt of the stealth taxes introduced by the SNP Lib Dem coalition. These are the same people that because of their circumstances will have higher energy bills, higher shopping bills, transport costs and it is grossly unfair that they pay the highest price of the freeze.

Any taxation system has to be built on fairness and it is unfair that the greatest beneficiaries of the council tax freeze is those living in the most expensive houses worth upwards of £212,000 and gaining £565.28 over the period whilst the pensioners living in their old people’s council houses will gain £188.40 and will have incurred more costs as a result of stealth taxes and cuts to services.