Liberal Democrat who run Kingston Council plan that there will be no rise in Council tax for 2012/13 whilst spenting more on essential services

This is the second year running there will be Council Tax freeze in Kingston and an additional £5.3million will be spent on essential local services, including adult social care placements and homelessness.

The Council has unveiled its detailed plans for spending in 2012/13 and an overview of its medium term financial plan for spending on local services up until 2015. With the Council’s grant from central government being reduced by nearly 10% next year Kingston faces a budget gap of £8.6 million between what it needs to spend and what it can afford.

The good news is that most of the spending gap for 2012/13 has already been met through planned savings introduced as part of the Council’s innovative ‘One Council’ transformation programme and local taxpayers will not be asked to spend more on their local services this year.

The Government set out last year their intention to reduce funding to all local authorities by 26% over four years. The reduction that Kingston has suffered has been much quicker and the Government grant to the Borough for 2012/13 will be 24% less than it was two years ago.

A structured programme of organisational change (‘One Council’) has enabled Kingston Council to rise to the tremendous challenge put on the financing of local public services. Decisive and proactive management has put Kingston in a strong position for this year with the prospect of further investment in local services of some in the years 2013-15 despite the growing pressure on resources available for public services.

The One Council transformation programme has enabled Kingston to address these challenges in a structured manner to achieve some impressive financial results.

Proactive and concerted budget management enabled the Council to achieve a slight under-spend in 2010/11 despite an unprecedented in-year cut in central government funding.

In 2010 Kingston faced the prospect of a 26% real terms reduction in funding over four years. Given the current inflation levels, the Borough will have comfortably passed that target figure within in half the time expected.

Last year we froze Council Tax and we are on target to deliver against our budget through a package of ‘One Council’ savings to the value of £13million (10% of our net budget). Our investment in the ‘One Council’ programme of £8.9m will have delivered ongoing annual savings of £12.7m by 2014/15. Over six years the One Council programme will have delivered net savings of £38.5m.

The significant challenge of year on year reductions in government funding will continue to face Kingston for the next four years at least. We expect to have to save a further £12.5 million between 2013/14 and 1015/16 in order to plug the anticipated shortfall. But the reductions in funding are only one aspect of the overall financial challenge facing local authorities across the country. Other challenges include:

– Inflation (which has peaked at over 5% this year) – This affects the costs of services we buy from outside the Council.
– Increasing demand for essential services – The cost of providing Learning Disability services is projected to rise by 10% per annum on average over the next three years. The Council needs to work with partners to address this issue in order to meet demand within our resources.
– Demand for school places – The increase in our population of young children coupled with the excellent reputation of our schools is driving a demand for additional school places far in excess of the funding provided for the purpose – sometimes success can make things more difficult, not less!

Whilst a two year pay freeze for local government staff has helped mitigate some of these issues by keeping salary inflation at zero, we are mindful of the pressures on public sector staff, particularly those on a low wage. We are making strong representations at a national level on behalf of those people earning less than £21k. If a national arrangement to support our lowest paid workers is not forthcoming we will consider what we can do locally.

Non-staff inflation continues to be a pressure for us, through such things as contractual arrangements that we are bound to. The Council recognises that this combination of growing demand, reducing resources and increasing costs means that we have to continue changing the way we do things. We must continue to innovate and find new ways of working with our partners to ensure that we are able to provide the services that our residents need and demand, at a cost we can all afford.

This year the Council is embarking on a further programme of transformation entitled ‘One Kingston’ to achieve this goal. This exciting programme follows from our own internal organisational change to focus on our relationships with our partners and other service providers to ensure that we continue to provide high performing services within the means we have available.

says Cllr Rolson Davies, Executive Member for Finance

The medium term financial plan will be considered by People’s Services Committee and Place and Sustainability Committee at their meetings on 31 January and 1February respectively. Their views will be considered by the Policy and Resources Committee at its meeting on 9 February 2012. A final recommendation will be considered at Budget Council on 29 February 2012.