Agenda item

Consideration was given to a report submitted by the Office of the Police and Crime Commissioner detailing the budgetary position for 2016-17.

It was reported that there was a reduction in funding for the 2016-17 financial year from Government amounting to approximately £1m compared to 2015/16. As part of the Finance Settlement for 2016/17, the South Yorkshire Police and Crime Commissioner (PCC) was given the flexibility to increase the council tax by 3.3%: this generated additional council tax income of £2.4m largely as a result of an increase in the council tax base.

The total level of revenue funding - including Government grant and council tax income - amounted to approximately £242m. The majority of that was allocated to the Chief Constable to finance Force running costs, including employee costs. In order to keep within the amount allocated and to meet the costs of demand and cost pressures, reductions of at least £6m were agreed as part of the budget process.

It was forecast that there would be an overall underspending of £4.2m in the current financial year. It was noted that a projected underspend of £2.7m sat within the Chief Constable’s operating budget. It was reported that the Chief Constable had taken steps to reduce expenditure in the current financial year in order to have resources to carry forward for use in meeting expenditure in 2017/18. One of the largest single variations related to Police Staff costs where there was a projected £2m underspend due to vacancies and staff turnover.

The overall position included a spending variation in respect of the costs of Operation Stovewood: this would be conducted by the National Crime Agency into historic allegations of child sexual exploitation. When the budget was agreed it had been assumed that Special Grant funding would be received from Government and that this would involve the application of a “1% rule”: the Home Office have in the past expected the Force to meet an amount equivalent to 1% of the budget with the Government providing the balance. The actual Special Grant award for 2016/17 had put a ceiling of £1m on the costs met by the Force.

It was further reported that one of the assumptions underpinning the 2016/17 budget was that any further costs that may potentially arise from legacy issues would be largely met from special grant allocations from Government. The nature and extent of any liability that may arise and the degree to which it should be set against the 2016/17 budget, had yet to be finalised.

Panel Members sought assurance in respect of the reserves strategy for the Force and noted that the forecast underspend would be used to supplement reserves. General reserves were recommended to be set around a minimum of £12m.

Recognising the difficult decisions that lay ahead, the Panel indicated that it would be willing to informally engage with the Police and Crime Commissioner to discuss the detail behind proposals for setting the budget. Panel Members indicated that they would welcome the opportunity to monitor the financial position throughout the year and to enter into a regular dialogue to better inform their scrutiny of precept proposals on an annual basis.

In response to a question from the Chair, the Police and Crime Commissioner confirmed that the Government had not offered a four year financial settlement the police, unlike that available to local authorities. The PCC also referred to the various approaches made by South Yorkshire to the Government for special grants for legacy issues.

Resolved:-

That the report be noted.