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Budget boost, but Birmingham still facing challenge of scale and pace

Budget boost, but Birmingham still facing challenge of scale and pace

🕔01.Feb 2017

The second and final report from the LGA co-ordinated independent financial review team looking at Birmingham city council’s budget proposals has been published. Whilst still not giving an unconditional endorsement of the Council’s ability to deliver the savings, it certainly represents an improvement since the interim report. 

Commissioned jointly by Birmingham City Council and the Birmingham Independent Improvement Panel, the review assessed the way the city council has developed its 2017/18 savings proposals. The follow-up visit took place on the 23rd and 24th of January.

The review team was made up of experienced senior officers and included the leader of Newcastle city council, Nick Forbes.

Overall, it would seem the review team was given details of savings proposals which gave it more confidence. However, the themes running through the report are concerns with capacity at senior levels to see through the changes and savings, pressures of time and service demands and the sheer scale and pace of the task.

The final report, much shorter than the interim version, again highlights issues with five key areas of risk in the budget. On the “Future Operating Model” the report borders on understatement:

…this remains a very significant and challenging piece of organisational change….

Other risk areas include adult social care and children’s services and supporting people. On the Service Birmingham contract – one of the council leader’s key policy commitments – it says:

…there is evidence that the direction of travel and ways of delivering savings is agreed. However, until contractual discussions are concluded it is still too early to give an opinion on the likely achieveability of savings.

The report summary says:

Overall it is clear that the Council has taken the recommendations of the review team on board and has responded well. There is work underway, where appropriate, to review the saving profiles of key high risk proposals, and the Council has established more robust governance arrangements to monitor progress on the delivery of the 2017/18 budget.

There is now much greater clarity and consistency in the delivery plans for the main savings areas. There has been a strengthening of the capacity to support change corporately but the Council understands that there is still a risk that the appropriate level of capacity may not exist within services and it is, consequently, in the process of reviewing directorate requirements accordingly.

The Council is reviewing its reserves strategy and giving consideration to a contingency plan. However this work is yet to conclude and therefore the review team is not in a position to comment on these at this stage.

Concluding, the report says:

There is, understandably, a great deal more to do and the scale and pace of change required should not be underestimated. The Council needs to take stock of progress on a regular basis.

There needs to be a stronger focus maintained over the coming year on the delivery of budgeted savings plans whilst at the same time maintaining close control of the Council’s overall financial position. There are still demand pressures in key services which threaten the Council’s financial position.

Funding reductions beyond 2017/18 will require additional savings potentially resulting in the need for further difficult decisions. It is important that the Council gives early consideration to these to allow sufficient time for planning and delivery.

Cllr John Clancy, leader of Birmingham city council said:

I’d like to thank the Independent Financial Review panel for their expert input and hard work over the past few weeks in analysing and advising on Birmingham City Council’s 2017+ budget plans. This has been an extremely useful process and I welcome the panel’s findings.

As the panel notes, we have spent valuable time developing our delivery plans. The report says we now have in place plans which show greater clarity and consistency in how we will implement the savings and the huge cuts we have to make.

We take on board absolutely the panel’s advice that the council must remain focused on delivering the substantial financial savings set out in the 2017-18 budget and that the scale and pace of change required should not be underestimated.

Chief executive Mark Rogers added:

There is of course plenty more work to do to be fully confident that we can deliver £78m of savings in the coming year and we have very challenging times ahead, as with all of our local government colleagues.

However, it is good to have the reassurance of peers that we are broadly on the right path and I would like to thank everyone who took part in this review.

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