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  • Writer's pictureDavid Taylor

What Happened at Budget Scrutiny?

Last night, Wednesday 31st January, we met as part of Havering's Overview and Scrutiny Board (OSB) to look at the proposed budget before it goes to Cabinet next week. The OSB does not have the power to force Cabinet to do anything, but it is formed of Councillors from all political parties and makes 'recommendations' to Cabinet following scrutiny of the proposals.

Our meeting lasted over 3 hours, with some fantastic discussions around the budget.

I've summarised my questions below.

To start with, I want to outline some of the recommendations we made.

Parks Parking Charges

I was unhappy with the proposal to charge for parking at Havering's parks. These are some of the only 'free parking' areas in Romford and access to parks is beneficial to health.

By giving people access to green spaces, we are reducing their impact on the NHS and social care budgets. We are helping people to stay active. Similarly, we are also allowing social groups to operate. In Romford, groups such as the Bowls Club and the Miniature Railway, would be really hurt if their members and visitors had to start paying to visit. It could put them at risk.

This is why I tabled a motion that the OSB recommend Cabinet do not agree to introduce the charges. I'm pleased to say that OSB backed my motion, with support from across the political groups, and we are now asking Cabinet to drop that proposal.

The outcome remains to be seen. Will Cabinet listen to the scrutiny?

30 Minutes Free Parking

Cllr Keith Prince raised that some shopping parades are not covered by the 30 minutes free parking, because they are 'in Romford'. This is because the Council's rule is that the free parking apply everywhere, except Romford. Cllr Prince has asked that this be reviewed and Officers have agreed to carry out an exercise of mapping the areas.

Sunday Market

When I read the saving's proposal, around closing the Sunday Market, I found that the council has been given legal advice to not amend the market operating hours, until a related bill has gone through parliament. The bill is at early stages and there is no guarantee that it'll go through anytime soon. In fact, if we have an election before it's completed then the bill could be dropped completely.

Council Officers are going to review the legal advice given to them.

My Questioning

We met for 3 hours, so I won't cover everything, but the main theme of my scrutiny was over the certainty of the predictions being made, and the modelling.

Everyone knows that if you change something, such as parking prices, it has an impact on something else. Hiking prices could mean more people drive out of town and head to Lakeside. This will kill Romford and impact the money our council gets from business rates.

So, it is only right that our council carefully model the impact of their decisions.

I do not have confidence in the predictions being made. Last year the council made provision for £2m of 'overspend', this being that they were prepared incase they didn't make the income or cut that they planned. The real figure turned out to be close to £20m. In this years predictions the contingency has gone up to £3, around 10% of the total proposals.

So, if the council is wrong by 10%, then we have a problem.

Havering Council have not carried out an exercise of modelling the impact of all the combined proposals. Some have been looked at in isolation, but not as a whole. I think this is concerning.

The Officers are doing the best they can, I'm sure, but we cannot say "we'll earn £x from parking charges" if we also admit that we don't have the data to estimate accurately. Some of the savings proposals actually say "we do not have the correct data to accurately predict.."

Highlights Video

A few clips of my questions, and some of the responses, are below.

My other concern was around the loan that we are asking for from Government. The loan will be expensive, it will grow our deficit by over £3m a year. We will need another one next year, so the deficit grows by another £3. In two years we will have added £6m to our £20m deficit and in 3 years almost doubled it.

I think that's dangerous and, as others agreed with me in the meeting, no government is going to change the formula in the next 3 years. There has to come a day when we say "enough is enough" and declare 'bankruptcy'. Otherwise we are on an infinite borrowing loop.

Havering's finance chief shared with us that they do not have a threshold at which they say "enough is enough". This is, in part, because they are legally required to balance the books every year. So, if there is a deficit, they have to ask for a loan. As long as government approves the loan, then we keep borrowing.

Our debt as a Council is around £600m (if I remember correctly). Some other London Council's have a debt of over £1bn and are still allowed to borrow. We could be in this cycle for a decade, whether Labour or Conservatives are in government.

Something has to change and I've been in contact with campaign groups to look at what needs to happen.

If we keep borrowing, and then eventually declare bankruptcy in 3 years, the pain will be even worse for residents. Government will have to put out council taxes up by even more, to cover a bigger deficit cause by borrowing.

It's like a choice of having your finger cut off now or your leg in 3 years. Which would you chose?

If you'd like to watch the full meeting, with the exempt parts excluded, you can do so on the link below.


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