Agenda item

To receive and consider the HNB / DSG Management Plan and Safety Valve Update report.

Sal Thirlway presented the HNB / DSG Management Plan and Safety Valve Update report.

Given the timing of the last meeting, there was limited change from the last time this was presented to Forum.  The date of the final submission of the proposition was Friday 13 January.  Feedback from the DfE on the proposals would be received on 24 January, and any amendments required would be made prior to the final submission on 3 February.  Following that, the Safety Valve Team would determine if the proposals were acceptable to put forward for ministerial decision.

A lot of activity had been undertaken in producing the proposals, and helpfully there had been weekly conversations with the DfE in preparation for the submission of the plan. 

The following comments were made during Sal Thirlway’s presentation:

·           The plan had identified savings in the region of £57 million over the six-year period of the programme; 

·           It was anticipated that the cumulative deficit would be £40 million at the end of the six-year period; 

·           A 50% contribution towards this deficit was being sought from the DfE;

·           The Council, through an Equalisation Reserve Fund would fund the other 50%;

·           It was expected that at the end of the six-year period a balanced Budget would be achieved, and the cumulative deficit would be cleared;

·           Through the various workstreams, it was expected that the cost of delivering services against the HNB would be reduced.

Sal Thirlway pointed out that although the report still contained the assumption of a 0.5% transfer from the Schools Block to the HNB, this would be taken out as there was strong indication that the disapplication request would not be approved.  The Equalisation Reserve Fund would be used instead to fund the amount.

Corrina Gillard asked: if the disapplication was approved, would the Council take it? And take it in future years?  Sal Thirlway stated that the transfer would continue to be sought in future years and was part of the proposals, but this would always subject to consultation with schools.

The Chairman observed that, according to the report, the next year Block Budget spend for the HNB would be around £36.2 million.  This represented around £4 million growth from this year’s expected spend.   He noted that there was a line on spend of DFG Growth Fund Reserve of £86k this year and £375k next year, however he could not identify these figures in the Growth Fund.

Katherine Vernon explained that the Growth Fund figures were moving and therefore were not correct in the report.  She confirmed that there was £406k in reserves for Growth Fund, any funds not spent this year would be carried forward to next year.  The report showed the impact of Growth Fund on all the DSG, not just in the HNB.

Sal Thirlway explained that the Safety Valve and the government were looking to achieve a balanced budget for the DSG, although it was understood that the deficit was generated from the HNB mainly.

The Chairman noted that a drop in spend of £1.2 million was being predicted in the second year of the programme and asked for details of how this would be achieved.

Sal Thirlway explained that all the savings would be delivered thorough the 20 or so workstreams which had been previously outlined to Forum.  These savings were being double checked before the submission on Friday.  A report would be submitted to Forum in March with the outcome of the proposals’ submission.

Sal Thirlway informed that the statutory instrument that ring fenced the deficit had only been extended for a further two years.  Therefore, even if Wokingham was not accepted as a Safety Valve authority, it was necessary to continue with the mitigating actions to tackle the deficit.

In response to a question Sal Thirlway confirmed that if the 0.5% disapplication was not allowed this year (which was highly likely), the local authority would be seeking 1% transfer in the next year through consultation.

It was emphasised that it was important that future consultations be carried out in good time and transparently.

RESOLVED That the update report be noted.