Agenda item

Petition submitted to Council on 7 July 2011 – Department of Health Funding

The Chair welcomed the Leader of the Council, the Portfolio Holder for Performance, Customer Services and Corporate Services, the Interim Director of Finance and the lead petitioner to the meeting.  He reminded Members that the transfer of £2.1m funding to the transformation budget had been debated and voted upon at Council on 7 July but as the petition contained in excess of 1,000 signatures, in accordance with the Petition Scheme, it was referred to the Overview and Scrutiny Committee for consideration.  He emphasised that debate could not be re?opened on this issue but that perhaps lessons could be learned from the Committee’s debate.

The Chair outlined the procedure for the meeting.  The Committee agreed that the petition was valid but some Members did not agree to the proposed time limit of 30 minutes for debate.  These Members indicated that whilst they accepted that the Council had made a decision they wished to have the questions submitted by the public answered.

The Interim Director of Finance gave a detailed explanation of the background to the transfer of the Primary Care Trust (PCT) funding and suggested that there had been some misunderstanding which she hoped would be clarified by her presentation.  The content of her presentation is included at Appendix I to these minutes. During the course of her presentation, the Interim Director of Finance advised the following:

·                    The Government had set a 28-30% reduction in funding for local government over a 4 year period.  This was against a backdrop of changing demography and inflationary pressures.

·                    The reductions in budget were front loaded and therefore would be most significant in the first two years of the four year period.

·                    To deliver the same services and operate in the same way as before, the Council would have had a shortfall of £19 million in 2011/12.  The Comprehensive Spending Review (CSR) meant that the Council would need to find approximately £60 million per annum of savings by the 4^th year of the CSR period, which meant that there was a need for major change. 

·                    The Government had directed PCTs to transfer money to Councils under Section 256 Agreements to help cover the costs of “existing social care provision”. For Harrow, this amounted to £2.6 million for 2011/12.

·                    The Council had not included this money in the 2011/12 budget due to concerns over the financial situation of the PCT, but it funded the costs of existing social care provision by using Council monies. This use of the Council’s base budget was preferable to relying on time-limited funding.

·                    The 2011/12 budget for adult social care included no cuts to front line services, although there were savings covered by a consultation that were fully covered by a contingency budget in the event they were not agreed. The budget did include an extra £1.5 million for demography pressures and a substantial share of a £1 million contingency.

·                    The Primary Care Trust (PCT) had transferred funds to Harrow as directed by Government.  There was no bidding process.

·                    The section 256 agreement had been signed on 29/30 March and the Council had received £2.6 million on 3 May 2011. £0.5 million was returned to the PCT to assist with some of their pressures which impacted on adult social care.

·                    As well as the revenue spend on adult social care, the Council had agreed to put an extra £1 million into adaptations to help more people stay in their own homes.

·                    The level of Council Reserves was now £7m but in the context of the scale of change these were still on the low side.  Members had agreed to add funds to the Transformation and Priority Initiatives Fund to give resilience across the Council.

·                    In terms of EIA, no change was being made to spending, no service was cut or citizen affected.

·                    The petition was flawed in that it suggested that the section 256 funds were not to be used for the purpose intended. This was not true. They were to be used for the purpose intended, but the funds previously budgeted by the Council when it was not confident of receiving the PCT monies, were being transferred out.

A Member expressed concern at the length of the Interim Director of Finance’s presentation and then a range of Members between them asked each of the seventeen questions submitted to the Chair by the lead petitioner in advance of the meeting and in accordance with the petition scheme.  The responses to the questions are detailed at Appendix 2 to these minutes.

Other Members made comments and asked questions which were duly responded to as follows:

·                    A Member expressed concern at the Interim Director’s comment that there was no equality impact of the decision, particularly given the previous presentation on the Birmingham judgement.  The Interim Director sought to reassure the Member in that although there was no formal EIA, all that had been done was the moving of funds.  The Portfolio Holder added that an EIA had been done on the original budget round.  Responding to another Member’s question as to whether additional work on EIA would be done in the future, the Interim Director advised that she would like to think that this work was always done.

·                    A Member questioned how the officer would analyse the social and community impacts of the decision, how the discontent in the community could be addressed and the learning points.  The Interim Director of Finance stated that she was concerned that this position had been reached, in particular in terms of communication, but she hoped that her presentation had explained the detail behind the formulation of the recommendation and the subsequent decision.  The Leader added that he had been advised by both the previous Corporate Director of Finance and the interim post holder and stated that perhaps if it had been more transparent as to what was happening with the DoH funding, the Council would not have found itself in the current position.

·                    A Member sought clarification on the advice in relation to the section 256 agreement as there appeared to be concern that the Council had not complied with the rules.  The Leader stated that all Cabinet and Council reports were formally agreed by Legal Services and that he was specifically advised that the agreement was in order.

·                    A Member stated that he had raised an issue in relation to the legal advice in the Cabinet report and had questioned whether section 256 had been complied with.  As a result of his query, the recommendation to Council in the Cabinet report had been amended.

·                    A Member suggested that it would be helpful for Members to engage with NHS Harrow as it was not clear what their view of the funding situation was.  It would be helpful to raise it with their Chief Executive.  He would also be interested in the view of the PCT and whether it was the same as NHS Harrow’s.

The Chair thanked the Leader, Portfolio Holder and Interim Director of Finance for their attendance and their responses.  He also thanked the petitioner for their questions.

RESOLVED:  That

(1)               the petition was valid for consideration and be duly received;

(2)               the Health and Social Care Scrutiny Sub-Committee be advised of the views of NHS Harrow and the PCT on the Council’s decision on the PCT funding.