Wednesday, January 10, 2007

2007/08 Merton Budget Papers

In Merton, the minority Conservative administration are now proposing a Council Tax of 3.6% that is above the favoured Government inflation figure of 2.7%. This figure could still increase and further questions will be asked about the figure. With Labour we would have delivered 2.5% rise in Council Tax and given the information within the report this target was more then attainable with the right budget management.

With regard to the financial settlement for 07/08, a telling comment from the Officer Report is in para 3.1 "this has not changed from the amount notified last year as part of the Government's two year announcement". Any of the bleating that has been made by the Tory leader David Williams about the settlement is pretty misleading given that it has been known since November 2005 and the comment from the report proves the point. A letter has also been sent to Phil Woolas, the Local Government Minister about issues surrounding the budget and pressures on the Budget. I doubt it will make much difference and whilst more resources would be welcome, they're unlikely to be forthcoming. I doubt the Tories would spend the extra resources on restoring some of their cuts.

The Council despite budget difficulties have proposed spending an extra £2 million on growth items. The new proposals include spending an extra £5K on a mobile phone masts campaign to bring it under planning legislation. An extra 46K is proposed on a feasibility study to remove Hartfield Bus Lane (my view is either leave it or remove it, spending money on a feasibility studies is a waste of resources) and this bus lane is less then 200 metres.

More spending is proposed to be spent on employing extra officers in planning and transport planning within the Council, given the Councils budgetary problems they equate to an additional £200K, some of these proposals will require very close scrutiny.

An extra £1 million is proposed for spending in Children, Schools and Families, while it includes an extra £120,00 of seven day provision for the most vulnerable children it does not include retaining Bond Road, it is clear that the Children Centres will not be completed by next April. They may help vulnerable children with one hand but take it away with the other.

In terms of other savings the Council will apparently save £1 Million pound through debt restructuring. This involves reducing our debt most of which was built up under the last Tory regime in Merton in the late eighties, that administration ran up massive debts through their borrowings, with interest rates over 10%(some were taken out at 15%) at the time the loans were taken out at rates more then double current interest rates. The Council has paid a considerable cost for their recklessness over the years. During the last Labour administration the amount was reduced considerably which has benefited financially the Council. The amount though it still considerable and is a burden on the Council. The Price Waterhouse report, which recommends further savings does need close scrutiny in terms of the proposals to reduce Debt Management.

Another £1.5 Million is apparently being saved through the review of accounting practices including leasing arrangements and ICT hardware. Again, it will involve refinancing at lower interest rates, unlike the debt-management strategy it is rather lacking in information within the published report.

In terms of single status no mention has been made within the report and further information is awaited on this matter, though the cost will be significant if it is implemented.

All of the proposed Budget will now go to Cabinet tomorrow and onto Scrutiny next week, no doubt many questions will be raised in relation to the proposals in the papers. Many more chapters are still be written before the Budget it's approved on 7th March.


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