Budget Presentation for Portsmouth City (UK) 2012 -2014

1. Baffins Neighbourhood Forum
Responding to the £56m Budget
Shortfall 2013/14 to 2015/16
Chris Ward
Head of Finance & S151Officer

2. Introduction
• Revenue Budget – Expenditure &
Funding
• Financial Background
• Budget 2012/13 (Current Year)
• Approaches to finding £27m (£56m
cumulative) savings
• Key Considerations

3. Revenue Budget – Expenditure &
Funding
• Sets out the City Council’s day to day expenditure and
how it is funded
• Total expenditure (£570m) is funded by a mixture of:-
– General Government Grants (Incl. Business Rates)
– Specific Grants & Subsidies (Schools, HBens etc.)
– Council Tax
– Income from fees and charges
– Contribution from Revenue Reserves
• Government requires Local Authorities to set a
balanced budget each year
• Aim is that In-Year Expenditure equals In-Year Income

4. Financial Background
• Difficult economic climate – flat economic growth,
rising unemployment, high public debt, falling real
incomes
• 2013/14 – 3rd Year of 4 year programme of Public
Sector cuts (30% for Local Government)
• Anticipating further cuts beyond 2014/15
• In addition:
– Significant demographic pressures – ageing population and
pressure on Adult Social Care
– Expectations and risks surrounding Safeguarding Children
– Increasing demands – Housing, Council Tax Benefits,
Inflation (Pay, energy etc.)

5. Financial Background
• Council financial forecasts – next 3 years £27m of ongoing
savings or £56m cumulatively
Financial Year 2013/14 2014/15 2015/16 Total
£m £m £m
Year 1 10 10 10 30
Year 2 9 9 18
Year 3 8 8
Total 10 19 27 56
• Council resolution Feb 12:
– £19m over 2013/14 to 2014/15
– A further £8m in 2015/16
• Current Year £7.8m savings made (£30m cumulatively over
3yr period) – almost entirely through efficiencies (minimal
impact on services)
• Scope for future efficiencies more limited and service cuts
inevitable

6. Budget 2012/13
Portfolio Savings Pressures Change
£’000 £’000 £’000 %
Children & Education (983) 1,048 65 0.2
Culture Leisure & Sport (389) 49 (340) (3.4)
Community Safety (362) - (362) (9.7)
Environment (481) 354 (127) (1.0)
Health & Social Care (2,103) 264 (1,839) (3.4)
Housing (179) - (179) (8.5)
Leader (12) - (12) (3.8)
PRED (276) - (276) (6.6)
Resources (2,719) 10 (2,709) (10.5)
Traffic & Transportation (287) 201 (86) (0.6)
Other Expenditure etc (35) - (35) (7.6)
TOTAL (7,826) 1,926 (5,900) (3.8)

7. Finding £27m (£56m cumulatively)
• Approaches to applying savings to Services could
be:
– Proportionate savings across all Services
– Proportionate savings but with some protection
of Services to the Vulnerable (but Adults &
Children’s Social Care consume circa half of the
available budget)
– An alternative prioritised method of determining
the incidence of savings across Services

8. Proportionate Savings - £27m (£56m)
Portfolio Base Budget Savings £19m % Savings £8m %
2012/13 2013/14 – 14/15 2015/16
£m £m £m
Children & Education 33.2 4.3 13.0% 1.8 5.5%
Community Safety 3.3 0.4 13.0% 0.2 5.5%
Culture, Leisure & Sport 9.0 1.2 13.0% 0.5 5.5%
Environment 12.4 1.6 13.0% 0.7 5.5%
Health & Social Care 46.7 6.1 13.0% 2.5 5.5%
Housing 9.2 1.2 13.0% 0.5 5.5%
Leader 0.3 0.04 13.0% 0.02 5.5%
Planning & Regeneration 1.7 0.2 13.0% 0.1 5.5%
Resources 24.7 3.2 13.0% 1.4 5.5%
Traffic & Transport 5.2 0.7 13.0% 0.3 5.5%
Other (Uncontrollable / 50.8 0.0 0.0
“One Off”)
Total 196.5 19.0 8.0

9. Key Issues for the Council
• Continue to deliver and accelerate the Council’s efficiency
programme (Transformation)
• Reducing dependency on Central Government Funding
(Council Tax, Income generation and charging for
discretionary services)
• Influencing demand for services (e.g. Regeneration –
homes and jobs) – manage costs
• Contract re-negotiation / consolidation
• Integration with Health – managing Social Care Costs
• Delivery via the 3rd Sector – Voluntary Services, Trusts
• Property rationalisation – save property costs
• Deciding which Service areas to make savings

10. Questions?

11. Budget 2012/13
£m
Gross Expenditure 569.495
Less: Gross Income (380.576)
188.919
Less: Government Grants (120.068)
Required from Council Tax 68.851
Divide by: Council Tax Base 59,916.1
Council Tax at Band D 2012/13 £1,149.12

12. Total Tax 2012/13 (Band D)
2011/12 2012/13 Increase
£ £ %
Portsmouth City Council 1,149.12 1,149.12 0.00
Hampshire Police Authority 146.25 146.25 0.00
Hampshire Fire & Rescue 61.38 61.38 0.00
Band D Property – Total 1,356.75 1,356.75 0.00

13. Tax for All Bands
Band 2012/13
A £ 904.50
53% of households in
B £1,055.25 Portsmouth pay the full
Council Tax
C £1,206.00
22% of all households in
D £1,356.75 Portsmouth receive
E £1,658.25 Council Tax Benefit
F £1,959.75 87% of all households in
Portsmouth are in Council
G £2,261.25 Tax Bands A-C
H £2,713.50