HERTFORDSHIRE COUNTY COUNCIL
ENVIRONMENT SCRUTINY COMMITTEE
TUESDAY 18 JANUARY 2005 AT 10.00 AM
ENVIRONMENT PROPOSED RESOURCE BUDGET 2005/062008/09
Joint Report of the Director of Environment and the Finance Director
Author:Mike Collier, Assistant Director (Resources)
01992 556010
Executive Member:Derrick Ashley
1.Purpose of the report
1.1To allow the Scrutiny Committee to consider the proposals on the revenue budget and capital programme made by Cabinet at its meeting on 13 December (attached at Appendix 1). These are for:
- a revenue budget of £90.251 million for the Environment portfolio in 2005/06. This is as detailed at Appendix 2 plus the reinstatement of the £2.5 million one-off spending in 2004/05 for highways maintenance in addition to the standstill budget
- County funded capital schemes of £15.307 million including annual provisions of £1.554million (as detailed at Appendices 3 and 4)
1.2To make recommendations/comments as appropriate. These will be considered by Cabinet on 7 February, along with the latest information on resources and the outstanding uncertainties. The County Council will agree the budget and council tax level on 10 February.
- Update
2.1Local Transport Plan
Since the report was written for the December cabinet report we have received notification of the provisional planning guidelines for the Local Transport Plan (LTP) over the next five years. The figures for Hertfordshire are as follows:
2.2
Maintenance£m. / Integrated Transport
£m / Totals
£m
2005/06 Actual / 8.596 / 12.600 / 21.196
2006/07 / Guidelines / 9.010 / 12.300 / 21.310
2007/08 / 9.190 / 12.300 / 21.490
2008/09 / 9.649 / 12.196 / 21.845
2009/10 / 10.132 / 13.563 / 23.695
2010/11 / 10.638 / 14.243 / 24.881
2.3At this stage the amounts are still subject to change and will be finalised in December 2005 as part of the LTP2 announcement.
Household waste Recycling Centres (HWRCs)
2.4Many of our HWRCs are in need of improvements as identified in the Service Property Priorities. However, as with many property transactions, opportunities to effect those improvements are difficult to plan for. When opportunities do arise they are often at short notice and if we are to take advantage of them we need to act quickly. The capital programme recommended by Cabinet includes £1m for Household waste recycling. Current indications are that this should enable work to progress at Stevenage and advantage to be taken of a recent opportunity at Rickmansworth HWRC.
Grant Income
2.5On 9 December, the Department for Environment, Food and Rural Affairs (DEFRA) announced awards of the Waste Performance and Efficiency Grant. The amount to be received by the County Council is £494,000 with the Hertfordshire Districts sharing a further £358,000.
2.6This grant was described by the government as being unringfenced. However, the covering letter from DEFRA described the grant as targeted and goes on to say "While there are no specific requirements to invest the funding under the Waste performance and Efficiency Grant in a particular way, the Government strongly encourages county-district and Joint Waste Disposal Authority Area to consider joint investment to meet common goals..... Government is seriously considering making single allocations to waste partnerships in two-tier areas from 2006/07"
2.7The grant is part of a total for England of £40m allocated for 2005/06. The national totals for the following two years have been announced at £105m and £110m respectively. If the Hertfordshire Authorities receive a similar proportion of grant in future years there could be a total of over £2.2m per year available in the following two years.
2.8The use of this grant will be considered by the Cabinet at their meeting in February and included in their recommendations to the full council
Planning Obligations
2..9The report of the Planning Obligations Topic Group appears as a separate item on today’s agenda. The report having previously been considered by the Resources Scrutiny Committee on 4November.
2.10Having considered the Topic Group’s report, the Resources Scrutiny Committee commended the Topic Group’s recommendations to the Environment Scrutiny Committee and requested the Directors of people & property and Environment to quantify the additional resources required. They also asked the Executive members for Resources and Environment to support the [Resources Scrutiny] Committee’s request for additional resources to be made available in Corporate Services and Environment Departments to maximise the contributions to HCC services from Section 106 Agreements. This issue is covered in the covering report of the Planning Obligations Topic Group.
APPENDIX 1
CABINET – 13 DECEMBER 2004
COUNTY COUNCIL RESOURCE BUDGET 2005/06 TO 2008/09
Executive Member: David Beatty
Proposals
- That the following budget of £1,075.104 million is proposed, which reflects passporting for schools, standstill (including efficiency savings) for other services and reinstates the £2.5 million one-off spending for highways maintenance, subject to the resolution of the uncertainties relating to the budget.
2005/06
Proposed Budget
£m
Adult Care Services / 198.390
Children, Schools and Families / 683.014
Community Services
Libraries, HALS, Arts and Trading Standards / 20.574
Fire & Rescue / 34.540
Registration / 0.728
Coroners / 0.840
Emergency Planning / 0.638
Crime Reduction Unit / 2.412 / 59.732
Corporate Services / 11.505
Environment / 90.251
Information Technology / 0.282
Central Items / 31.930
1,075.104
Note: the service budgets shown above do not include movements in the allocation of overheads, capital charges or the FRS17 pension adjustments.
2.That the proposed schools budget for 2005/06 be agreed as £530.692 million (excluding capital charges) plus £16.999 million in respect of the Teachers Threshold/Performance Related Pay Grant and that the budget be notified to the DfES by the deadline of 31 December 2004.
3.That the Transitional Support Plan in respect of the Education Targeted Transitional Support Grant of £3.9 million (which is in addition to the above proposed budget) be agreed in consultation with the Executive Member for Education and the Executive Member for Resources and submitted to the DfES by the deadline of 31 January 2005.
4.That the Environment Scrutiny Committee and Transport Panel analyse the LTP and that the Director of Environment includes a recommended allocation in his report to the March meeting of the Cabinet on the Integrated Highways Works Programme.
5.That the draft Capital Programme for 2005/06 – 2007/08 be approved as set out in the attached schedules (Appendix 3 attached), including the annual provisions set out in Appendix 11 of the report (Appendix 4 attached) and to the extent that this programme exceeds the estimated available resources quoted in the report the Cabinet will consider funding options, including the use of reserves, at its meeting in February.
APPENDIX 2
PORTFOLIO: ENVIRONMENT
PROPOSED RESOURCE BUDGET 2005/06 - 2008/09
Chief Officer: John Wood (01992 555200)
Contact for queries: Mike Collier (01992 556010)
APPENDIX 1 - CONTENTS
ACommentary
BRevenue Budget 2005/06 - 2008/09 and Movement from Current Year’s Budget
CPressures for Change
DSavings
APPENDIX 2A
COMMENTARY
1.1This Appendix outlines details of the proposals for a revenue budget of £87.751million (excluding capital charges and the FRS17 pension adjustment) for Environment.
1.2The cashable efficiency savings included in the proposals are summarised below with fuller details provided in the following appendices:
£’000Cashable Efficiency Savings
Waste Volumes & Recycling / 600
Hertfordshire Highways Contract / 500
Section 74 Income / 375
Charges / 32
Staffing efficiencies / 30
Total / 1,537
1.3In addition to the cashable efficiencies, a further £617,000 of non-cashable efficiency savings have been identified and these are detailed in appendix 2D. Taken together, the total new efficiencies come to over 2.1m or 2.6% of the adjusted 2004/05 budget.
2.Local Transport Plan Settlement
2.1The County Council bids for Central Government support for highway maintenance and other capital schemes through the Local Transport Plan (LTP). The formal allocation of funds is made on an annual basis, with the announcement for 2005/06 being received on December 2nd.
2.2The award for integrated transport schemes and structural maintenance came in at £21.196m. This is £416,000 below the amount received in 2004/05, but £656,000 above the indicative levels previously notified. the history of recent awards is shown in the table below:
2002/03 / 2003/04 / 2004/05 / 2005/06Actual £000 / Actual £000 / Actual £000 / Indicative £000 / Actual £000
Integrated Transport / 12,950 / 14,170 / 12,350 / 12,600 / 12,600
Maintenance / 10,586 / 7,939 / 9,262 / 7,940 / 8,596
Totals / 22,536 / 22,109 / 21,612 / 20,540 / 21,196
2.3The County Council will receive £14.2m in grant and supported borrowing in 2005/06 for continued work on the Baldock bypass. This is some £5m less than anticipated and work is currently in hand to assess the implications of this reduction. The government have provisionally accepted the work at Watford Junction interchange and work will now take place between the County Council and the Department for Transport (DfT) on when this scheme can be fully approved. Requests for funding in 2005/06 will be considered by the DfT when the scheme returns for full approval. On a less positive note, it is disappointing to note that a firm decision has still not been made in regard to Croxley Rail Link and that the bid for funding for major works on the recently de-trunked A414/A405 has been rejected.
2.4The Director of Environment will be submitting a report on the integrated highways works programme to Cabinet on 21 March 2005. The report will include schemes funded from revenue, general capital programme and the LTP. It would therefore be appropriate for the report to include a recommended allocation of the LTP settlement across schemes or programme areas after consideration of priorities, consultation with district councils and following advice from the Transport Panel.
- Highways Maintenance
- At its meeting in February 2004, the County Council agreed one-off increases of £2.5m in the revenue budget and £2.58m in the capital budget available for highway maintenance in 2004/05. These amounts have therefore been removed from the revenue budget shown in appendix2b and from the existing capital programme shown in appendix 3.
- When taken with the LTP, the total amount available for highway maintenance in 2005/06 is currently £40.5M. This is £3.6m less in cash or £6.4m less in real-terms (having applied inflation to the full base) than 2004/05. The figures for recent years are shown in the following tables.
- Cash Budgets
HCC Funds / LTP Funds
£000 / Total Funds
£000
Revenue
£000 / Capital
£000 / Total
£000
2002/03 / 23,197 / 3,500 / 26,697 / 10,586 / 37,283
2003/04 / 28,938 / 4,400 / 33,338 / 7,939 / 41,277
2004/05 / 26,762 / 8,080 / 34,842 / 9,262 / 44,104
2005/06 / 25,815 / 6,050 / 31,865 / 8,596 / 40,461
3.4Real-terms budgets (at 2005/06 prices)
HCC Funds / LTP Funds£000 / Total Funds
£000
Revenue
£000 / Capital
£000 / Total
£000
2002/03 / 26,344 / 4,150 / 30,494 / 12,552 / 43,046
2003/04 / 31,615 / 5,006 / 36,621 / 9,032 / 45,652
2004/05 / 28,315 / 8,654 / 36,969 / 9,921 / 46,890
2005/06 / 25,815 / 6,050 / 31,865 / 8,596 / 40,461
4.Hertfordshire Highways Staffing
4.1Increased pressure on Hertfordshire Highways from the public and elected members has resulted in significant additional workload. In addition, staffing levels have not kept pace with the increased throughput. This has led to a reassessment of resource levels assigned to customer care, problem solving and other works management activities. An additional eight members of staff would assist in meeting this increased demand and could be financed from within the sums received from the Department for Transport for de-trunked roads.
APPENDIX 2B
REVENUE BUDGET 2005/06 - 2008/09
AND MOVEMENT FROM CURRENT YEAR’S BUDGET
ENVIRONMENT
2005/06£’000 / 2006/07
£’000 / 2007/08
£’000 / 2008/09
£’000
2004/05 Original Budget / 84,287 / 84,287 / 84,287 / 84,287
Less one-off growth / (2,500) / (2,500) / (2,500) / (2,500)
Technical Adjustments 2004/05 / (136) / (136) / (136) / (136)
2004/05 Adjusted Budget / 81,651 / 81,651 / 81,651 / 81,651
Technical Adjustments 2005/06 / 268 / 268 / 268 / 268
Inflation / 5,960 / 8,010 / 10,160 / 12,310
Pressures for Change:
Demographic Change
1. Domestic Waste Volumes / 500 / 1,000 / 1,600 / 2,200
2.Road Length Increases / 100 / 200 / 300 / 400
Legislative Change
1. Countryside & Rights of Way Act / 50 / 75 / 100 / 100
2. New Roads & Street Works Act – buried apparatus / 0 / (30) / (30) / (30)
3. Strategic Environmental Appraisals / 40 / 40 / 40 / 40
4. Local Development Frameworks for Minerals & Waste / 40 / 40 / 40 / 40
5. WasteAware funding / 100 / 100 / 100 / 100
6. Traffic Management Act / 50 / 50 / 50 / 50
7. Duty to Salt / 50 / 50 / 50 / 50
Other Pressures
1. Business Rates / (14) / (12) / (10) / (2)
2. Increments / 71 / 107 / 107 / 107
3. Revenue Effects of Telecomms / 9 / 22 / 35 / 49
4. Revenue Effects of Capital / 50 / 125 / 200 / 200
5. Capital Payback / 370 / 370 / 370 / 370
6. Preparation for Transfer of NonCore Trunk Roads / (50) / (50) / (50) / (50)
7. Bus Routes Requiring Support / 50 / 100 / 150 / 200
8. Road Death Investigations / 26 / 26 / 26 / 26
9. Local Transport Plan 2 / 47 / 0 / 0 / 0
10. Savercard / (100) / (100) / (100) / (100)
11. Herts Observatory / 20 / 0 / 0 / 0
Cashable Efficiency Savings
1. Waste Volumes & Recycling / (600) / (600) / (600) / (600)
2. Hertfordshire Highways Contract / (500) / (500) / (500) / (500)
3. Section 74 Income / (375) / (375) / (375) / (375)
4. Charges / (32) / (32) / (32) / (32)
5. Staffing Efficiencies / (30) / (30) / (30) / (30)
2005/06 STANDSTILL BUDGET / 87,751 / 90,505 / 93,520 / 96,442
APPENDIX 2C
PRESSURES FOR CHANGE
Demographic Changes
/ £’0001.Domestic Waste Volumes
The volumes of household waste that the County Council is obliged to dispose of each year continues to rise in common with all waste disposal authorities. / + 500
+1,000
+1,600
+2,200 / 2005/06
2006/07
2007/08
2008/09
2. Road Length Increases
With increases in residential developments, the length of roads that the County Council has a responsibility to maintain continues to grow each year. This item allows for a modest increase in the budget available to maintain these roads.
/ +100+200
+300
+400 / 2005/06
2006/07
2007/08
2008/09
Legislative Changes
1. Countryside & Rights of Way ActRights of Way Improvement Plan as well as processing of changes to the definitive map and servicing of the Local Access Forum. The additional duties are likely to be reflected in the Formula Spending Share (FSS), as in previous years. / +50
+75
+100 / 2005/06
2006/07
2007/08
onwards
2.New Roads & Street Works Act – buried apparatus
This item removes growth that was allowed for in 2004/05 for two years only. / Nil-30 / 2005/06
2006/07
onwards
3.Strategic Environmental Appraisals
Guidelines implementing the European Union Directive on Strategic Environmental Assessments have recently been published. These require detailed assessments to be undertaken on a number of County Council produced plans such as the Local Transport Plan, the Minerals Local Plan and the Waste Plan. Assurances have been received from ODPM that the costs of these assessments have been reflected in the FSS.
/ +40 / 2005/06 onwards4. Local Development Frameworks for Minerals & Waste
Under the Planning & Compulsory Purchase Act the County Council is obliged to produce a Local Development Framework which involves changes to the public consultation process which is more intensive than the current local plan process and a statutory requirement to produce an annual report.
/ +40 / 2005/06 onwardsAPPENDIX 2C (cont’d)
£’0005.WasteAware Funding
Changes to the way in which funding from landfill tax credits is allocated has meant that funding for the WasteAware Coordinator and associated campaign work is no longer eligible. / +100 / 2005/06 onwards
6.Traffic Management Act
The Traffic Management Act requires roadspace booking including recording on our roadworks database. In addition, Highway Authorities are required to have a Traffic Manager, overseeing all Traffic Management on the network and adjoining networks of influence.
/ +50 / 2005/06 onwards7. Duty to Salt
The implications of the duty to salt are becoming clearer as good practice develops, requiring extra resources in this area.
/ +50 / 2005/06 onwardsOther Pressures
1. Business RatesThis relates to the estimated additional costs arising from the 2005 revaluation of property for rating purposes. / -14
-12
-10
-2 / 2005/06 2006/07
2007/08
2008/09
2. Increments
This relates to the incremental progression of staff. / +71
+107 / 2005/06
2006/07 onwards
3. Revenue Effects of Telecomms
These are this department’s share of the revenue consequences of undertaking corporate telecommunications capital works.
/ +9+22
+35
+49 / 2005/06
2006/07
2007/08
2008/09
4. Revenue Effects of Capital
These are the revenue consequences of undertaking capital works within the agreed capital programme. / +50+125
+200 / 2005/06
2006/07
2007/08 onwards
5. Capital Payback
Payback associated with the general capital programme. / +370 / 2005/06 onwards6. Preparation for Transfer of Non-Core Trunk Roads
This item removes the growth that was allowed in the budget to cover the transitional costs required to negotiate the transfer of newly de-trunked roads and other costs involved in managing the new network. / -50 / 2005/06 onwards
APPENDIX 2C (cont’d)
£’0007. Bus Routes Requiring Support
As operators surrender bus routes that were previously commercially viable, HCC has a statutory duty to decide whether to provide support to keep the services going. This budget allows for some additional support following route rationalisation. / +50
+100
+150
+200 / 2005/06
2006/07
2007/08
2008/09
8. Road Death Investigations
New guidelines issued by the Association of Chief Police Officers will require more detailed investigations of all fatalities on the highway. / +26 / 2005/06 onwards
9. Local Transport Plan 2
The County Council is obliged to publish a 'full' Local Transport Plan in 2005/06. It is also required to undertake a new accessibility planning process, which requires additional consultation and the acquisition of new software. / +47
nil / 2005/06
2006/07 onwards
10.Savercard
A review of the budget for Savercard has identified a reduction of £100,000. / -100 / 2005/06 onwards
11.Hertfordshire Observatory
Much work has been undertaken by both the University of Hertfordshire, and more recently the County Council, to establish the Hertfordshire Observatory. Funding is required for a year to assist in ‘marketing’ the services of the observatory to partner organisations to ensure it becomes self-financing. / +20
nil / 2005/06
2006/07 onwards
APPENDIX 2D
SAVINGS
Cashable Efficiency Savings
/ £’0001. Waste Volumes and Recycling
New and innovative Household Waste Recycling Centre (HWRC) operation contracts have incentivised the operators to improve their control of waste input while maximising the levels of recycling and re-use. These efforts have been backed up by the staff of the Waste Management Unit through their support of the HWRC operators’ efforts and their vigilance in giving advice to and dealing with, the general public. / -600 / 2005/06 onwards
2. Hertfordshire Highways
The contracts that created Hertfordshire Highways included a requirement for year on year efficiencies. Savings of £500,000 should be achievable from 2004/05. / - 500 / 2005/06 onwards
3. Section 74 Income
Guidelines issued following the recent court case have clarified the circumstances in which local authorities may charge utilities for ‘overstaying their welcome’ on the highway. This should result in additional net income to the County Council of £375,000 per year. / -375 / 2005/06 onwards
4. Charges
A review of charges should result in net additional income of £32,000 per year. / -32 / 2005/06 onwards
5. Staffing Efficiencies
By continuing to critically examining staffing vacancies as they arise it should be possible to realise net savings of £30,000. / -30 / 2005/06 onwards
Non-Cashable Efficiency Savings
1. Adshel SheltersThe County Council and eight of the district councils have signed a contract with Adshel that makes provision to provide and maintain bus shelters. It is estimated that the County Council would have needed to find £500,000 if the anticipated provision to be implemented in the coming year was provided directly. Because of uncertainties surrounding the advertising market, and the need for planning permission for new shelters, estimated values are particularly tentative at this stage. / -500
-700 / 2005/06
2006/07
APPENDIX 2D (cont’d)
£’0002. Web Reporting of Highway Faults
The Department has been promoting the use of the web as a means of reporting highway faults. This item represents the additional costs that would have been incurred if the faults had been reported by telephone.
/ -30 / 2005/06 onwards3. Rural Estates Improvements
The agreed Master Plan 2050 contained the intention to seek environmental improvements on the Rural Estate. The Improvement Plan 2004/09 has identified a number of holdings that will be retained by the County Council in the longer term. With a greater emphasis on the improvement of the Environment in agricultural subsidy arrangements, there is an opportunity for the County Council to take a lead role in promoting a range of improvements on its own land that will benefit not only the local environment but provide new access opportunities for the people of Hertfordshire. This item reflects the fact that some improvements can be funded on a self-financing basis using increased rental income. / -30 / 2005/06 onwards4. Development Control – Increased Volumes
A reorganisation of the way the County Council deals with planning applications requiring development control advice should allow the increase in volumes to be dealt with without an increase in staff.