Leeds Liberal Democrats

Budget Speech by Cllr Richard Brett - Joint Leader of Leeds City Council

Thank you. Lord Mayor. In moving the budget today I want to start by thanking the large number of officers who have contributed to ensuring this budget will work for the people of Leeds. As well as Alan Gay, Doug Meeson and Helen Mylan who co-ordinate this, we have Dave McDermott in Children's, Ed Mylan in Development, Steve Hume in Adult's and Mark Forbes in Environments and Neighbourhoods. Alan, can you pass on my thanks to all those involved in helping senior councillors put this budget together.

Before moving on into the details of our budget, I would like to share my concerns regarding the recent news about unemployment rates in our country. There is no need to remind anyone here that Leeds has suffered greatly from the recession. We have seen developments stall, businesses collapse and peoples' livelihoods ruined. This year has not brought much relief to the council either. Latest government figures reveal that Leeds' unemployment soared to the highest level in more than 13 years. Ministerial warnings that the numbers will continue to rise do little to raise our spirits.

Yorkshire's rate of those claiming Jobseekers Allowance is 9.1 per cent. That is one of the highest levels in the UK. We suffered one of the biggest increases over the last 12 months. I would like to ask the Employment Minister, Jim Knight, if you acknowledge it is Yorkshire that has been hit the most by the recession, why are you not doing more to help us? If you recognise Leeds is struggling, why have you given us the lowest grant settlement ever? We are all aware that we are not getting a fair share of funds, on this point even Keith agrees with me. There is no logic here, we are the ones who suffer the most, but we are given less than everyone else. Let us not be misled with the government's claims that it is only as a result of the present economic crisis. We have been short-changed for years.

The rise in unemployment puts a strain on council services. People seriously affected by the recession rely on us to provide stability and security in these difficult times. I want to assure everyone here that this council will do all it can to help them.

It used to be the case that we had some flexibility in our budget. If the ruling administration wanted to put a bit more into one area they had the resources to do just that. Now we have no freedom over the budget at all. Why are we in this position? Well, it is clearly Gordon Brown's fault. It isn't right to say that the government were not warned of the problems that were brewing. Many commentators and politicians had tried to raise the issues of debt and the nation's finances. Its as though the government simply stuck its head in the sand. Don't believe me? Listen to this excerpt from Hansard, now almost seven years old.

Vince Cable, at the time, Deputy Leader of the Liberal Democrats, asked then Chancellor Gordon Brown in November 2003:

"The growth of the British economy is sustained by consumer spending pinned against record levels of personal debt, which is secured, if at all, against house prices that the Bank of England describes as well above equilibrium level. What action will the Chancellor take on the problem of consumer debt?"

Mr Bean replied:

"We have been right about the prospects for growth in the British economy, and the hon. Gentleman has been wrong."

I do not think there would now be many on that side of the chamber that agree with Mr Brown's comments today.

Resources are so tight in the current climate that simply keeping our front line services going is itself a major challenge. That is what we have tried to do - maintain frontline services to the people of Leeds. We have succeeded in that aim. But because of our stretched resources there are few surprises in this budget, no rabbits being pulled out of hats and relatively few startling headlines. I make no apology for that. At one stage I thought we might have to make headlines for the wrong reasons by closing some buildings or stopping services. We have not had to do that because there have been a whole series of creative, inventive and wide ranging efficiencies. So I put it to you that the absence of big ticket cuts is in today's circumstances a triumph in itself.

The Council's income comes from three sources - Government grant, fees and charges and council tax.

This is the last year of a three year grant settlement which gives us a 1.8% increase which means £5.4 million in cash terms. Compare that to the core city average of 2.2% and to Labour controlled Nottingham's 3.1% and you will see once again the Government have not been generous to us. Keith describes the government's treatment of Leeds as "disappointing". I don't think the word even comes close to describing just how bad a hand we have repeatedly been dealt by his government. Not only have we witnessed the lowest grant settlement figure ever, we also have to bear the withdrawal of Neighbourhood Renewal Funding. Next financial year sees our replacement NRF money run dry. The government would have you believe all our problems have been solved. We all know in Leeds this is certainly not that case.

The current financial year has seen a continuing decrease in income from planning fees and parking charges. The latest financial health report estimates that external income sources, including planning and building fees are down by almost £4m. It is obvious that city development has been particularly hit by the downturn in the economy and the stalling of many development projects. We have recognised that the economy isn't recovering as quickly as we would have hoped. As a result we have reduced our income expectations in city development by £3.5m next year.

We are estimating for the new budget that income in this area will not decrease further. This is of course determined by whether the recession grows deeper, flat lines or we recover. This is not an area where Leeds City Council has any significant control over what happens. Our fees are generally going up in line with inflation.

The third area of income is council tax. Many Leeds residents have been struggling with their finances during 2009. Investment income is very low and many pensioners will struggle to pay even modest council tax increases. Government sources have indicated that a notional capping level of around 3% will be applied. We have budgeted for a 2.5% increase, Leeds lowest increase for fifteen years. Let me put our council tax in context. Out of 36 metropolitan authorities Leeds is currently 31st - i.e. fifth from lowest. Out of 8 core cities Leeds is currently the 7th lowest in it's charging. Our council tax is around £200 less per year at band D compared to Nottingham.

We have decided to mainstream some of the key activities previously funded by Neighbourhood Renewal Fund. Despite losing central government support there are still many schemes and projects we will continue by further increasing efficiencies. Of 60 posts previously funded by NRF or the Safer and Stronger Communities Fund 40 will be mainstreamed in this budget. In 2007/08 around £24m was dependent on one off sources. In this budget the figure has dropped to £13m. With this budget we have maintained council services, even when Whitehall has tried to remove our means of doing so.

At this point I would like to once again highlight the amazing abilities of our treasury management team to reschedule our debt portfolio. It is the savings they produce that enable us to avoid the excessive use of reserves. Earlier this month Keith mentioned reserves in executive board. He always does, no doubt we will hear something again today. What we do on this side is listen to our experts. They have advised us that £12m is the minimum and that is what we plan to maintain. We are not budgeting to use any reserves next year, yet we will have a safe buffer should the unforeseen happen.

The total staff employed by Leeds City Council has been reduced in recent years. Over the past six years we have removed around 1,200 posts from the council's budget. There will be an estimated loss of around 300 posts during the next financial year. None of these changes have been sudden or catastrophic. These post reductions are possible with effective management, better use of technology and a review of processes. The key point is that they will not affect front line delivery of services.

Before going on to introduce the revenue budget I would like to briefly mention the council's capital programme. Over the next five years we are seeking to deliver over £870m worth of investment. That is quite an amount. It serves as testament to our belief that Leeds can weather the difficult financial storm and we are committed to improve our city for all to enjoy. Our capital programme now makes provision for the delivery of Leeds Arena. This is the single largest project ever to be undertaken by the council. We have already seen a great deal of progress on site, with the former Brunswick Terrace building bulldozed and our partners continuing to draw up plans. It is this administration that is now delivering what Leeds' residents have been calling for for years.

It isn't all about the arena though. We are continuing with our refurbishment of the City Varieties. Northern Ballet and Phoenix Dance will soon be enjoying their new facilities thanks to council support. We continue to upgrade our city centre streets, replacing worn out, misleading signage and installing some quite impressive street furniture. New leisure centres in Armley and Morley will be opening in April and June. Members will be pleased to hear that we will continue to provide £40k per ward under the Ward Based Initiatives scheme. There have been some wonderful investments of this over the previous year with schools, community groups and voluntary organisations all benefiting throughout the city.

Our capital programme allows us to improve communities throughout the city. There isn't a single ward that doesn't benefit from considerable investment. I am pleased to present it to council and will leave Cllr Carter to go into further detail.

One of the most difficult aspects of our budget is that many of the services we provide are demand led. The needs of an ageing population can't be controlled by the Civic Hall. In recent years there have been significant changes in the way we deliver services for vulnerable Adults and that process needs to continue. This is not political code for "cuts". In 2003-04 Labour spent £119m on Adults, forming 28% of the council's total budget. This year's budget sees a cash increase of £4.3m, meaning the council spends over £200m on Adult Social Care, over one third of the total council revenue budget. I think we can all agree the demographic pressures of older people living longer and needing more support means this increase is essential.

The budget shows we plan clear increases in direct payments to vulnerable adults, training and development of staff and publicity and promotion of our services. All of this we believe leads to improvements not cuts. A key part of our plans is to increase the amount of home care provided and avoid the necessity of residential care placements. We are expanding the telecare service to provide a greater range and level of equipment. This will also reduce domiciliary care costs. The mobile response service will expand. These changes will again produce improvements not cuts.

That's the detail and the short term future for Adult Social Care. The medium term prospects are worse than ever and not just for Leeds. Since this administration took over the proportion of the council's expenditure spent on Social care for adults has risen from 28% to 35% of the total. But we know that on current trends this will need to increase further. There are more people needing our services every year and the standards they expect are more expensive. We here today will not accept what our parents accepted and our children will be even more demanding. Fifty years too late, we are trying to give a reasonable standard of living to people with learning disabilities. It is only twenty years since we thought Meanwood Park was the best we could do.

This is not a problem that Leeds or local government can solve on its own. There has been the beginning of national debate about the subject in the last six months or so and some rather unsatisfactory party political points from all sides in recent weeks. Right now, society is not ready to face up to the costs of looking after older people. Budget increases by local authorities of 3, 4, or 5% are not the answer; they are all we can afford but they are the least we can do. Adult social care is the largest financial pressure facing Britain today and something must be done at national level to help councils cope with ever growing demands.

Moving on to Children's Services. Again in Children's Social Care the demand is difficult to predict and sudden increases in unmet needs can place real strains on our budget. Following the recent OFSTED inspection an extra £6.2m has been put into Children and Young People's Social Care as we recognise the importance and need to focus on safeguarding. Our budget continues to support a relatively high number of looked after children. To support improvements in working practices an additional £1.65 million has been included to fund social care fieldwork and the recruitment of additional staff. I'd like to thank Cllr Bill Hyde for the recent work of the Children's Services Scrutiny Board. The work they have done in highlighting the increased demand for services and the need to transfer more resources into this area proved very helpful.

It is vital that we find and train more people to foster our vulnerable children and young people. Therefore an additional £2.1m is to be added to Fostering Services with a doubling of the recruitment and training budget from £60 to £120k. 2010/11 will see the third and final phase of our children's centre programme, with the number of centres growing to 58 with 30 in key areas of deprivation. All of this adds up to improvements not cuts.

We will, despite rumours to the contrary, maintain the use of both Herd Farm and Lineham Farm for needy youngsters. But a review will take place and we will be asking primary schools in receipt of earmarked money to make a contribution towards the costs of using Lineham Farm. As recently reported in the YEP Leeds' schools will be handed £2.5m to support out of school activities and we believe it is right that schools help the council with Lineham Farm's costs. No child will be charged. No child will be turned away. Provision has been made in our central contingency to make sure these promises will be kept and that the wonderful service these two centres provide will continue.

In City Development we have made provision for £250k to be spent supporting the England World Cup bid for 2018. For those who think this is a large sum bear in mind the benefits of Leeds hosting the world cup are estimated at £20m, with an expected 100,000 visitors coming to Leeds.

There is £150k extra to promote a Business Support Scheme for small business tenants. I'm sure you would all agree it's a great investment to help Leeds out of the recession. Again, delivering improvements, not cuts.

This council is committed to providing an effective winter service, permitting the safe movement of traffic and pedestrians throughout the city. The efficiently managed service keeps delays to a minimum. That is why this financial year our roads have been gritted over 80 times, twice as many times as four years ago. This amounts to over 100,000 miles of roads gritted around Leeds, using 21,000 tonnes of salt. We understand that we need to make it as easy as possible for people to move around in adverse weather. That is why we also provide nearly 1000 grit bins located across the city and have responded to hundreds of requests to have them refilled. We are continuing talks with our West Yorkshire neighbours and central government about the possibility of a shared grit store. This is something we will continue to press for, allowing the authorities to provide a more strategically linked service. Sadly nationalising the salt provision has led us to a position where we are now unable to grit all our main roads.

The headlines for Environments and Neighbourhoods are around more recycling and community safety. In Environmental Services the productivity gains from the resolution of last year's strike (over £2 million in a full year) will be used to provide many more green and brown bins. The combined recycling/composting rate should increase to 41% by the end of March 2011. We will encourage schemes which increase the reuse of furniture and other items. Once again, improvements not cuts.

In Neighbourhoods and Housing the Council continues to support 170 PCSOs throughout every ward in the city and will upgrade some CCTV networks with a contribution of £192k. Crime has dropped by around 40% since this administration took over in 2004, in part due to our improved working with local partners.

Most grants to voluntary organisations will be at the same level as last year. Earlier this year we launched Leeds Year of Volunteering. Even in this short time we have seen an amazing level of interest. That is why we will continue to support the project, with our contribution increasing to £100,000 next year. The extra funding will allow us to extend the scheme and hopefully encourage even greater levels of participation. Leeds Ahead are heavily involved in the Year of Volunteering. The Audit Commission are featuring them as an exemplar green flag in their presentations on the Comprehensive Area Assessment.

Council house rents will go up 3.1%. We have little choice. If we tried to put them up less we would have to pay the difference to the Government. If we put them up more, the extra money would again go to the government. So much for local choice. Time and again we are given money by government but then told how and where to spend it.

That isn't the only news on the housing front however. 2010/11 marks the continuation of many great schemes throughout the city. Work will continue to secure around £190m worth of PFI housing schemes in Little London, Beeston Hill and Holbeck. There is already a great deal to witness. The demolishing of Carlton Towers in Little London has already started. Once completed the works will see 125 new council homes built and 853 homes refurbished. The area will see new shops, a housing office and community centre built. The contract we have signed will see the properties maintained for years to come.

The Executive Board has recently approved plans for 700 new homes at 10 different sites throughout the city. The new homes are specifically designed to support independent living, providing older people the security and support they need and those less able bodied the means of getting around. These are purpose built, two or three bedroom properties, built around existing neighbourhoods, helping people lead more active and independent lives.

We have aspirations for this city. We don't want to rest on our laurels, we want to drive regeneration forward. That is why we will continue to develop the West Leeds Gateway and Leeds Bradford Corridor schemes. The schemes have the possibility of radically changing the fabric of our city. Over the next 10-15 years we could see thousands of new homes built, thousands of jobs generated and new transportation schemes linking our city in a greener, more responsible way.

In my own portfolio we have been able to achieve a greater reduction in resourcing than earlier planned. Two years ago I talked about back office services reducing by 2% a year for 5 years. We had planned a 10% reduction in costs over five years. This year the Central and Corporate portfolio faces a budget reduction of almost £2m. The two new joint service centres in Chapletown and Harehills will be opened with costs contained within existing budgets.

The council's newspaper is being reviewed. A new look 'partnership publication' is scheduled to be launched next financial year with editorial input and resources from the Police and the NHS. We also hope to include the fire and rescue service, the Environment Agency and a number of other public sector organisations. These plans may lead to a change in format. But residents will still receive a regular publication from the council and it's partners. The changes have allowed us to cut the cost of About Leeds by £80,000 in 2010/11. The following year we are expecting to see the savings increase to £100,000.

Another important project the council is supporting is the delivery of the Leeds City Region Pilot Programme. Our contribution to the scheme will double from 2010/11 to £200k. Devolving more powers and responsibilities from national to regional level will bring decision making closer to city communities and their needs. For us it means greater control over how and where money should be spent.

We have not budgeted for a staff pay increase, this means members would not be provided one either. It is important we set an example to our workforce, perhaps had our parliamentarians acted in a similar manner they could have saved themselves considerable embarrassment. The issue of staff pay is important. We value our workforce and recognise the considerable efforts they make. However, we cannot afford a pay award this year. Any pay increase would mean losing further jobs and make maintaining services incredibly difficult.

The easy thing in any budget is to produce pieces of paper which balance. The Labour amendment shows how easy it is to make things look good on paper. Serious reductions in advertising and publicity have already taken place. Keith's plan to save an extra £800k would cripple major events and savage our sources of income. Cutting external legal advice would be a hugely risky venture. Reducing the use of consultants is easy to say, but in many cases we are buying in expertise we don't have in order to save money. Keith's amendment is dishonest. He should admit he is spending more. He should have suggested a council tax increase of 3.1% to pay for his pipedreams.

It is much harder to stick to a tough budget. As we have found this year, in a recession your income goes down and there is less natural staff movement. Sticking to this budget will be no easy task. That is where efficiencies come in. I thought I should spend some time on this in case anyone thinks that £22.1m worth of efficiencies hides cuts. What are these efficiencies. Some are easy to understand - not employing as many temporary staff - most Directorates are planning to do this. Savings in procurement are a major part of this picture. We are looking at the way we purchase in all areas and some big savings are being identified. Some of these are working with partners through the Regional Improvement and Efficiency Partnership.

The authority has already started investigating many of the options for efficiencies that will help us through the next few difficult years. As members will be aware, the Delivering Efficient Corporate and Transactional Services programme, working in partnership with the Local Government Association is already well underway. The programme has examined each area of the council, looking at the different ways we go about our business. Officers and elected members will soon be looking at the outcome of these investigations, with a view to making significant back office savings. These savings will come about through streamlining processes and adopting best practice throughout the council. Once again, demonstrating improvements, not cuts.

Another course of action recently approved by the executive board is the 'Changing the Workplace' business case. The project is re-evaluating our use of premises throughout the city centre, seeking to rationalise departments and services into a single building. Not only does the scheme have the possibility of providing cashable efficiencies totalling £87m over a 25 year period, but it will also help us improve customer services and access. It is this kind of innovative thinking that is going to help secure Leeds' future in the years to come.

So in summary this has again been a tough budget. A budget with little flexibility but a budget characterised by improvements and not cuts. We are providing excellent value for money for the people of Leeds with a 2.5% Council tax increase.

Lord Mayor, I commend this budget to Council.