The previous Labour Council’s rhetoric was that Libraries had to be reviewed and made ‘community managed’ due to the impact of Central Government cuts. They had no choice?!
In the 12 July 2017 Cabinet paper it stated:
“The Council‟s Medium Term Financial Plan (MTFP) requires the Library Service to identify £648k additional savings by April 2018“
In the MTFP for 2017/18 the requirement was confirmed as a recurring net saving of £336k pa. With a further £337k pa in 2018/19.
No savings were achieved in 2017/18 – in fact the Library strategy created a cost increase in the year. Did the Council overspend, did it have to dip into reserves beyond the plan. No! In fact it underspent the plan by £2.845m ( by over 8 times the required saving from Libraries).
When the Council published the plan for 2017/18 it accepted that it could take £5.268m from reserves. A proportion of this was to deliver pre-election “sweeteners”. These “sweeteners” were considered a higher priority than saving the jobs of 46 Derby City Council employees.
The Council routinely endeavours to underspend the budget by around 0-2%, to avoid overspending ( sound financial practice) – an amount representing, up to, £4m. This suggests that the Council ( and it would apply to any sizeable organisation) sees that anything less than £4m is within the “noise level” of managing finances; a figure 6 times greater than the total planned saving from the libraries.
The Labour Group should, as a matter of principle, be focussed on the welfare of the Council’s staff; the option existed to recommend that the “underspend” be used to protect employee’s jobs. A real current day issue. They chose not to do that.
Instead, a proposal, was presented to identify a brand new purpose, not budgetted for by the their previous administration, not identified as an actual problem to the Council’s finances. This was to create a fund that may be required if future hardships relating to Universal Credit became evident and where such issues were then, actually, a net cost to the Council. At present that is speculation.
It is clear that the Community Managed Library strategy is NOT driven by cost constraints within the Council. The level of saving planned ( and this continues to decrease) is in the “noise level” for budgetting; it cannot manage finances to that level of accuracy.
It is also transparent that the Library strategy was implemented for political reasons, and that the recommendation to transfer the underspend ( in fact, an under usage of the planned transfer from reserves), back to reserves, on the back of potential costs relating to Universal Credit was equally political.
The budget for 2018/19 is “balanced” – that is, the full demand on the Council’s services can be met by committed funding from Central Government, Council Tax and Business Rates, without the use of reserves. As the Library strategy continues to be an increased cost burden to the Council, and it is unlikely that there will be any net savings in 2018/19 then it is clear that the Council can balance its budget without the need to make 46 staff redundant.
Perhaps the Labour Group already knew this, hence their alternative proposal last week?