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4. COUNCIL TAX 2015/16
The only outstanding issue for 2015/16 is the setting of Council Tax. The Secretary of State has announced that the Referendum limit for 2015/16 is 2%. If the Council was to increase its Council Tax by 2%, i.e. below the Referendum threshold, this would raise £1.8m in income. This is in line with the forecast described above.
The Secretary of State also confirmed that for those Councils that freeze their Council Tax in 2015/16 a Council Tax Freeze Grant would be awarded which will provide funding in 2015/16. This would amount to a grant of £1.1m and if the Council was to accept this grant, then the overall resources available to the Council would be £0.7m less.
Whilst previous Council Tax Freeze Grants have been incorporated in the Revenue Support Grant there is currently no guarantee that the 2015/16 Freeze Grant will be fully funded in 2016/17 and beyond.
In effect the Council has two main choices as summarised below:-






Raises

Less than Forecast




£m

£m

Set CT below the Referendum Limit, ie. +2.00%

1.8

0.0

Accept CT Freeze Grant and set CT at a 0% increase

1.1

0.7

Members will need to strike a balance between the immediate impact of a Council Tax increase on Council Tax payers and the on-going permanent increase in the Council Tax base of increasing Council Tax. A 2.00% increase in Council Tax for Bolton Council is the equivalent to an additional 33p per week on Band A properties which are more than 40% of the properties in Bolton. The permanent addition to the Council Tax base would be the £1.8m additional income.


That in respect of the Revenue Budget 2015-17 the Cabinet recommended to the Council that the Council Tax be frozen for 2015/16 with the balance of £0.7m funding to achieve this in addition to the freeze grant to be taken from the one-off revenue funding.


Police and Fire Authority Precepts
The Fire and Civil Defence Authority Precept and the Precept for the Police Authority has been estimated as follows:-





Band A

Band D

Increase




£

£

%

Police

101.53

152.30

0.00

Fire & Civil Defence

38.42

57.64

0.00

Should the final decisions of these Authorities be different, then this will be reported to Members at the Council meeting.


On the basis of a total budget requirement of £205.916m (i.e. total expenditure less Dedicated Schools Grant, New Homes Bonus, Public Health funding, Council Tax Freeze Grant and Use of Reserves) the balance to be raised from Council Tax is £89.954m as shown below:-



 

2014/15

2015/16

 

£000s

£000s

£000s

£000s

 







 

 

Bolton




222,819




205,916

Parish Precepts




364




370

 













Budget Requirement




223,183




206,286

 













LESS













Collection Fund (Council Tax)




400




400

 













 




222,783




205,886

 













LESS INCOME













Revenue Support Grant

73,420



53,219



Business Rates Top-Up

18,813




19,172




Non Domestic Rates

41,888

134,121

43,541

115,932

 













Balance to be raised from Council Tax




88,662




89,954

 












The Council Tax base for tax setting purposes in 2015/16 is 70,176 Band D equivalent properties.


The basic amount of Council Tax for the part of the Council’s area where no Parish Precepts apply but including for the Police and Fire and Civil Defence precepts, is £990.99 for a Band A property and £1,486.50 for a Band D property.
The Council Tax bases for tax setting purposes for the Town Council areas are as follows:-





Tax Base in Band D Equivalents







Blackrod

1,809

Horwich

7,089

Westhoughton

8,198

The resultant additional Council Tax in each Town Council area for Band A and Band D properties are as follows:-







Additional

Additional




Council Tax

Council Tax




Band A

Band D




£

£

Blackrod

19.85

29.77

Horwich

17.47

26.21

Westhoughton

10.63

15.95

The table below shows the total Council Tax for all Bands in the various areas:-





Valuation Bands

Parish of Blackrod

Parish of Horwich

Parish of Westhoughton

All other parts of the Council's area













A

£1,010.84

£1,008.46

£1,001.62

£990.99

B

£1,179.32

£1,176.56

£1,168.58

£1,156.17

C

£1,347.79

£1,344.63

£1,335.51

£1,321.33

D

£1,516.27

£1,512.71

£1,502.45

£1,486.50

E

£1,853.21

£1,848.85

£1,836.31

£1,816.82

F

£2,190.16

£2,185.02

£2,170.20

£2,147.16

G

£2,527.11

£2,521.17

£2,504.07

£2,477.49

H

£3,032.54

£3,025.42

£3,004.90

£2,973.00

For information Appendix I sets out a comparison between the level of Council Tax in 2014/15 and 2015/16 (for those areas which do not include the Parish Council Precept) and the percentage of properties in each band.


Approximately 50% of households will receive reduced Council Tax bills through the Council Tax Support Scheme and Personal Discounts. For Council Tax the maximum support through the Council Tax Support Scheme is 100%. Some households will, therefore, not pay Council Tax. This will be highlighted on their bill. Consequently at this stage it is not possible to give an average bill.
Council Tax Billing
The Budget contained in this report assumes that the Council Tax is set at the Council Meeting on the 25th February 2015. Should the Council not be able to set the Council Tax on that day then a week’s delay will put back the processing and distribution of Council Tax bills which will incur additional costs.
5. STRATEGIC PROPOSALS TO MEET BUDGET REDUCTIONS
In November 2014 the Council approved a budget strategy to seek to respond to the scale of project reductions which have now been confirmed. In summary this involved:





  • the identification of c£17m corporate finance options to mitigate reductions required in service budgets




  • a set of criteria against which departmental and corporate savings targets will be allocated, to ensure that organisational priorities and values are protected as far as possible. This includes




    • That as much as possible should be found from reductions in management and administration and from further efficiency measures

    • That the most vulnerable should be protected and lower levels of savings found from children’s and adults social care services

    • That targeting should take place to protect services to individuals and areas in greatest need and deprivation

    • That given the reductions taken so far from front-line universal services such as green space provision (ie grass cutting and street cleansing), these services should be protected from further service reductions if possible, although further efficiencies and non-front line reductions will be necessary.

  • A strategic approach to delivering savings by examining the use of:




    • streamlined and centralised support services;

    • the appropriate use of capital and one-off reserves;

    • alternative service delivery models;

    • a new customer contact strategy;

    • a new relationship with the community based on increased self-reliance;

    • public service reform and

    • maintaining good employment practices.




  • arrangements were also published for a pilot Community Empowerment Fund, to provide one-off investment to enable residents to mitigate the impact of Council funding reductions by becoming more self-sufficient.

By applying these principles, a budget strategy was proposed at a high level as follows:







  • the implementation of a digital, corporate support service







  • delivering environmental services in partnership with Wigan MBC.

Further details about each of the proposed options is set out below, following further work and analysis.


The adult’s social care company
The Council proposes to set up a wholly owned, Local Authority Trading Company (LATC). The objectives for the company would be:


  • To reduce net costs

  • To create a sustainable organisation within the market of social care provision

  • To create a service that remains within the Council’s strategic guidance and control

  • To retain any surpluses for the Council

  • To maintain a fair level of pay and conditions

  • To sustain the existing strong public service ethos

  • To focus on quality provision.

Analysis is ongoing about the precise scope of services to be transferred into the LATC however, at this stage, the proposal is to include the following during the 2015/17 budget round.



The decision to absorb the Extra Care service into the LATC is subject to further work. It should be noted, however, that the original Council budget proposals provided for a stand-alone review of the Extra Care Service with a savings target of £1m. If it is approved that the LATC absorbs this service then the separate budget option will be withdrawn but the savings target for the company will be increase by the same amount.


There could be consideration of further services to be included in the LATC towards the end of this budget period, such as intermediate tier services or service provide through the Better Care Fund.
430 Council staff are currently employed in the services which at this stage are proposed to be in scope of the LATC, occupying a total of c400 Full Time Equivalent (FTE) posts and the total budget is approximately £12m.
Existing staff will be given the option to transfer to the new organisation on their existing terms and conditions, or to take voluntary severance or voluntary early retirement prior to transfer. The Council has been asked for a position on the scope for the LATC to re-employ staff who leave the Council on severance terms; the council’s policy position will be determined as part of detailed consultation however there is nothing in law to prohibit this.
In order to achieve savings, new staff would be employed on lower terms and conditions. The specific pay and grading arrangements for new starters will be subject to consultation but will be based on Living Wage principles and specified contracts of employment (ie no zero hours arrangements). The standard of terms and conditions will be built into the agreement between the Council and the company.
The company will also have an aspiration to grow business beyond that awarded by Bolton Council. Key areas that will be investigated in the future include selling services to:


  • Self-funders and direct payment holders: This could include traditional care services, personal assistant services

  • Potential of specialist dementia residential care

  • Other Local Authorities

  • Health organisations: with respect to issues such as helping to deliver earlier discharge from hospitals


The intention would be to develop the detail of this option as a basis for consultation by end of May 2015 and to allow a period of 3 months detailed consultation. Subject to the outcome of consultation, it would be possible to establish the company from April 2016.
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