Agenda item

a)    Budget Report 2021/22 including MTFS

b)    Treasury Management Strategy 2021/22

c)    Reserves strategy update

d)    Capital Strategy and Capital Programme

The Commissioner introduced his report which set out the proposed budget and precept proposals for the Police and Crime element of his portfolio for 2021/22.  He reported that the Home Office Police Grant for Staffordshire had been set at £122.417million, an increase of £7.259million on the previous year. The total policing requirement was £222.051 million.  Other sources of funding were from the Police Pension Grant £1.825million; Uplift Ring-fenced grant £1.483million; Revenue Support Grant of £8.423million and Council Tax freeze grant £3.541million; Local Council Tax Support grant £1.365million and a deficit of £200,000 from the Council Tax Collection Fund.

The Commissioner was proposing to part fund the balance from Council Tax funding of £83.197 million proposed increase of 5.99% per annum (£13.48 pa per Band D property). The Commissioner informed the Panel that this figure was below the permitted limit of £15 but felt that it struck a balance between what could reasonably be asked of Council tax payers and the investment required in local policing. 

The Commissioner explained the following headline investments would be made during the course of the Medium-Term Financial Strategy (MTFS) above those provided for by Central Government:

·       Increasing Digital Forensic examination capacity and capability,

·       Increasing capacity within Force Intelligence,

·       Increasing transformation capability

·       A significant investment, via the capital programme, in Police IT,

·       A modern and fit for purpose Policing Estate,

·       A modern fit for purpose Police fleet

The Commissioner felt that this was a challenging financial position, with significant uncertainty into the medium term which made planning very challenging.  The current Covid-19 pandemic had had a significant impact on the tax base and deficits on collection funds from 2020/21. 

The Panel received a presentation from the Chief Finance Officer, which was considered along with the report which included the following:

a)         Budget Report 2021/22 including MTFS

b)         Treasury Management Strategy 2021/22

c)          Reserves Strategy update

d)         Capital Strategy and Capital Programme

The Panel noted that the Settlement was for one year only in view of Government’s Comprehensive Spending Review and acknowledged the increased level of risk built into the 2021/22 budgets due to uncertainty around future funding.  

Members asked if the level of debt and level of reserves were acceptable to the Chief Financial Officer.  In response it was reported that the level of debt was detailed in the Treasury Management Strategy and Capital Programme and this may increase in the medium term due in part to the proposed investment in a Operation Hub / Firearms Range.  It was explained that this had only been granted outline business case approval at present and a more detailed business case was needed prior to decision, but if granted this may affect borrowing.  The level of reserves had improved over recent years and was now more acceptable.

The main financial risks to the budget were outlined as:

·            One-year spending review and the assumption of a cash flat central government funding over 4-year MTFS and a c8% real term cut over the same period.

·            Pensions cost as a result of the age discrimination ruling.

·            2021/22 settlement.

·            Pay – national assumption on pay pause which needs to be monitored.

·            National charges around IT and the national capital programme.

The Treasury Management Strategy for 2021/22 which set out proposals for the management of the Commissioner’s cash flows, borrowing and investments and the risks of a changing interest rate on borrowings and investments and the risks of a potential loss of invested funds.

The Reserves Strategy update paper considered the overall level of reserves held at 31 March 2020 and the forecast position at 31 March 2021.  The paper focused on two key areas of reserves that impacted on the future financial strategy.  These were the General Reserve balance forecast as at 31 March was £6.4m (3%).  Earmarked Reserves, to meet future or predicted requirements balance at 31 March 2021 was forecast to be £13.9m.

The Commissioner presented his four-year Capital Strategy and Capital Programme 2021/22 to 2024/25 (Including Minimum Revenue Provision Policy) which set out the long term capital investment and investment decisions, considering both risk and reward and impact on the achievement of priority outcomes in line with the current Staffordshire Policing Plan.

It was explained that the second year of the Governments uplift programme which would see an additional 20,000 Police officers recruited nationally by the end of 2022/23.  It was noted that the first year of the programme had seen an additional net growth of 90 officers in Staffordshire once accounting for retirees and leavers.  Following the national spending review, the programme would now fund 6,000 new officers in year 2, resulting in an additional 89 officers in Staffordshire by 2022 as part of the programme.   

Whilst welcoming the uplift programme and recruitment of the additional officers, it was felt that during these difficult times of Covid and its financial implications, it was important that the public should see an increased visual presence in communities.  The Panel also asked about the number of PCSO’s and felt that their number had reduced recently.  It was explained that the type of staffing posts had changed but the number of employees had remained the same.  Crime was changing and was more complex, requiring specialist officers. The following diagram was used during the presentation.  It was noted that the pay budget had increased due to the impact of uplift.  It was also noted that there was also an additional 35 members of support staff recruited during 2020/21.

The Panel adjourned to consider their response to the Commissioners budget and precept proposals.  Upon reconvening the Panel:

RESOLVED:

a)    That the proposed budget and Precept increase of 5.99% (£13.48 per annum, per household (Band D)) be supported and the Commissioner be notified accordingly.

b)    That the next Commissioner be requested to consider ways of  demonstrating increased number of officers to the public who feel there is a reduction in their communities.

c)    That the Council Tax base decrease to 348,733 properties, equivalent to a decrease of 1.2% be noted.

d)    That the Budget and MTFS fully support and include the investment required to deliver the Officer Uplift of 89 by 31 March 2022 in line with the Ring-Fenced Grant of £1.483m be noted.

e)    That the use of £0.305m of revenue reserves to support the capital programme in 2021/22 be noted.

f)      That the MTFS summary financials and MTFS assumptions as contained in the report be noted.

g)    That the Support the delegation to the Director of Finance for the Staffordshire Commissioners Office and the Chief Finance Officer of Staffordshire Police to make any necessary adjustments to the budget as a result of late changes to central government funding (including changes due to the final funding settlement being announced) via an appropriation to or from the general fund reserve be noted.

h)    That the proposed four-year Capital Investment Programme and the Capital Strategy and Capital Programme Paper be noted.

i)      That the outcome of the Staffordshire Commissioner’s budget consultation within the Commissioners foreword which included a survey regarding the proposed level of precept for 2021/22 be noted

j)      That the Panel be provided with the numbers of PCSO’s, Police Officers and Support Officers employed over the last three years. 

k)    Details of the Business case to develop an Operation Hub / Firearms Range, as outlined in the report, be included in the Panels work programme and considered prior to decision.